The DOI matches its Crossref record; 40 of the 40 references it cites were found in a registry or an index.
Do Banks Provide Financial Slack?
Abstract
We study the decision to choose bank debt rather than public securities in a firm's marginal financing choice. Using a sample of 500 firms over the 1980 to 1993 time period, we find that firms are relatively more likely to choose bank loans when variables that measure asymmetric information problems are elevated. The sensitivity of the likelihood of choosing bank debt to information problems is greater for firms with no public debt outstanding. These results are consistent with the hypothesis that banks help alleviate asymmetric information problems and that firms weigh these information benefits against a wide range of contracting costs when choosing bank financing.
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Cites
Corporate financing and investment decisions when firms have information that investors do not have
Myers, S. C., & Majluf, N. S. (1984) · Journal of Financial Economics · doi:10.1016/0304-405x(84)90023-0 · Cited by 18,957
Financial intermediation and delegated monitoring
Diamond, D. W. (1984) · The Review of Economic Studies · doi:10.2307/2297430 · Cited by 8,476
INFORMATIONAL ASYMMETRIES, FINANCIAL STRUCTURE, AND FINANCIAL INTERMEDIATION
Brealey, R., Leland, H. E., & Pyle, D. H. (1977) · The Journal of Finance · doi:10.1111/j.1540-6261.1977.tb03277.x · Cited by 4,055
Insiders and Outsiders: The Choice between Informed and Arm's‐Length Debt
RAJAN, R. G. (1992) · The Journal of Finance · doi:10.1111/j.1540-6261.1992.tb04662.x · Cited by 3,902
Monitoring and reputation: The choice between bank loans and directly placed debt
Diamond, D. W. (1991) · Journal of Political Economy · doi:10.1086/261775 · Cited by 3,331
Smith, C. W., & Warner, J. B. (1979) · Journal of Financial Economics · doi:10.1016/0304-405x(79)90011-4 · Cited by 2,894
Some evidence on the uniqueness of bank loans
James, C. (1987) · Journal of Financial Economics · doi:10.1016/0304-405x(87)90003-1 · Cited by 1,610
Self-citationEquity issues and offering dilution
Asquith, P., & Mullins, D. W. (1986) · Journal of Financial Economics · doi:10.1016/0304-405x(86)90050-4 · Cited by 1,379
Valuation effects of security offerings and the issuance process
Mikkelson, W. H., & Partch, M. M. (1986) · Journal of Financial Economics · doi:10.1016/0304-405x(86)90049-8 · Cited by 1,213
Covenants and collateral as incentives to monitor
RAJAN, R., & WINTON, A. (1995) · The Journal of Finance · doi:10.1111/j.1540-6261.1995.tb04052.x · Cited by 1,193
Cited by
Does the Source of Capital Affect Capital Structure?
Faulkender, M., & Petersen, M. A. (2006) · Review of Financial Studies · doi:10.1093/rfs/hhj003 · Cited by 1,375
The effect of capital structure on profitability: an empirical analysis of listed firms in Ghana
Abor, J. (2005) · The Journal of Risk Finance · doi:10.1108/15265940510633505 · Cited by 962
Factors affecting profitability in Malaysia
Alarussi, A. S., & Alhaderi, S. M. (2018) · Journal of Economic Studies · doi:10.1108/jes-05-2017-0124 · Cited by 328
Local Bank, Digital Financial Inclusion and SME Financing Constraints: Empirical Evidence from China
Lu, Z., Wu, J., Li, H., & Nguyen, D. K. (2022) · Emerging Markets Finance and Trade · doi:10.1080/1540496x.2021.1923477 · Cited by 274
“This healthy relationship would encourage local banks to invest more in information acquisition to further reduce informational asymmetries between banks and SMEs (Hadlock and James 2002).”
BackgroundArm’s Length Financing and Innovation: Evidence from Publicly Traded Firms
Atanassov, J. (2016) · Management Science · doi:10.1287/mnsc.2014.2097 · Cited by 157
Metadata
- Authors
- Hadlock, C. J., & James, C. M.
- Venue
- The Journal of Finance
- Publisher
- Wiley
- Published
- 2002-06
- Volume
- 57
- Issue
- 3
- Pages
- 1383-1419
- ISSN
- 0022-1082 (ISSN-L)
- 1540-6261
- OpenAlex
- W2110120163
- Cited by
- 455
- References
- 40
- FWCI
- 37.81
- Type
- journal article
- Language
- en
- Open access
- closed
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Bibliographic data: Semantic Scholar, OpenAlex, Crossref.
Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
