The DOI matches its Crossref record; 47 of the 47 references it cites were found in a registry or an index; 6 of the 25 sources its claims cite were checked for support.
The Capital Structure Puzzle
Open accessAbstract
The finance and economics literature has at least three "managerial" strands: (1) descriptions of managerial capitalism, in which the separation of ownership and control is taken as a central fact of life, for example Berle and Means [5]; (2) agency theory, pioneered for finance by Jensen and Meckling [18], and (3) the detailed analysis of the personal risks and rewards facing managers and how their responses affect firms' financing or investment choices.For examples of Strand (3), see Ross's articles on financial signalling [36, 37]. 2 Put forward in "Debt and Taxes," [27], esp.pp.272-273.Note that Miller did not claim that all of firms' financing habits are neutral mutations, only that some of them may be.I doubt that Miller intended this idea as a strict null hypothesis (see below).
Overview
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Claims the paper makes
75 Own interpretation · 13 Sources not found · 3 Supported · 3 Partly supported · 3 No basis given · 2 No full text of the sources · 1 Not checked yet · accuracy not yet measured
The cited sources support only part of this claim — read each source’s verdict below.
In the paper
“Firms holding valuable intangible assets or growth opportunities tend to borrow less than firms holding mostly tangible assets.”
What the sources say
- Supportedcites Long and Malitz [21] 21. Long, M. S., and E. B. Malitz, "Investment Patterns and Financial Leverage," Working Paper, National Bureau of Economic Research, 1983. source
The Theory section says firms with tangible investment opportunities can support more debt than firms with intangible or firm-specific opportunities. The Conclusions and Implications section also reports that firms investing heavily in intangibles have lower debt capacity than those investing in tangible assets. (LLM, conf=0.94)
- Not matchedcites Williamson [41] 41. Williamson, S., "The Moral Hazard Theory of Corporate Financial Structure: An Empirical Test," Unpublished Ph.D. Dissertation, MIT, 1981.
Couldn’t be matched to a paper in Crossref, so it can’t be checked.
plaincorrelational- Asserted: passes — The authors put it forward as true.
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- Load-bearing: passes — The paper’s conclusions depend on it.
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- Supported
The cited sources support only part of this claim — read each source’s verdict below.
In the paper
“In Miller's theory, the personal income taxes on interest payments would exactly offset the corporate interest tax shield, provided that the firm pays the full statutory tax rate.”
What the sources say
- Partly supportedcites [27] 27. Miller, M., "Debt and Taxes," Journal of Finance, 32 (May 1977), 261-275. sourceExperimental — accuracy not yet measured
In “Market Equilibrium and the Behavior of Firms and Individuals” (page unavailable), Miller says personal taxes on bond interest can offset the corporate benefit of deductible interest, and that the offset is one-for-one when the relevant tax rates satisfy a specified relationship. Paying the full statutory corporate tax rate alone does not establish that relationship; the personal tax rates on bond and stock income also matter. (LLM, conf=0.87)
hedged- Asserted: passes — The authors put it forward as true.
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- Partly supported
Every source the paper cites for this claim was checked and supports it.
In the paper
“However, since the equilibrium only determines aggregates, debt policy should not matter for any single taxpaying firm.”
What the sources say
- Supportedcites [27] 27. Miller, M., "Debt and Taxes," Journal of Finance, 32 (May 1977), 261-275. source
Section IV, “Taxes and Market Equilibrium” (page not supplied), says the equilibrium sets aggregate corporate debt but no optimum debt ratio for an individual firm. It also says that, in equilibrium, a firm's value is independent of its capital structure despite the tax deductibility of interest. (LLM, conf=0.94)
plain- Asserted: passes — The authors put it forward as true.
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- Supported
The cited sources support only part of this claim — read each source’s verdict below.
In the paper
“Risky firms tend to borrow less, other things equal.For example, both Long and Malitz [21] and Williamson [41] found significant negative relationships between unlevered betas and the level of borrowing.”
What the sources say
- Partly supportedcites Long and Malitz [21] 21. Long, M. S., and E. B. Malitz, "Investment Patterns and Financial Leverage," Working Paper, National Bureau of Economic Research, 1983. sourceExperimental — accuracy not yet measured
Table 6 reports a negative coefficient for unlevered beta (−0.099, t-statistic 7.62), and the Empirical Results section says its effect on leverage is negative. But that section also reports a significant positive relationship between total risk and leverage, so the broader claim that risky firms generally borrow less is not supported without specifying the risk measure. (LLM, conf=0.89)
- Not matchedcites Williamson [41] 41. Williamson, S., "The Moral Hazard Theory of Corporate Financial Structure: An Empirical Test," Unpublished Ph.D. Dissertation, MIT, 1981.
Couldn’t be matched to a paper in Crossref, so it can’t be checked.
plaincorrelational- Asserted: passes — The authors put it forward as true.
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- Partly supported
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Then if adjustment costs are small, and firms stay near their target debt ratios, I find it hard to understand the observed diversity of capital structures across firms that seem similar in a static tradeoff framework.”
plain- Asserted: passes — The authors put it forward as true.
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The paper states this without a source or data behind it here, so there is nothing to check it against. The quote shows it is in the paper.
In the paper
“The extensive trading of depreciation tax shields and investment tax credits, through financial leases and other devices, proves that plenty of firms face low marginal rates.”
boosteddirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Thus Miller's model allows us to explain the dispersion of actual debt policies without having to introduce non-value-maximizing managers.”
plaindirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Firms can not immediately offset the random events that bump them away from the optimum, so there should be some cross-sectional dispersion of actual debt ratios across a sample of firms having the same target ratio.”
plaindirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“and that is an assumption we can immediately reject.”
plain- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Trouble is, this explanation works only if we assume that all firms face approximately the same marginal tax rate”
plainconditional- Asserted: passes — The authors put it forward as true.
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- Probably not a substantial claim. 13
- It may state two separate claims as one. 24
Every source the paper cites for this claim was checked and supports it.
In the paper
“Miller described an equilibrium of aggregate supply and demand for corporate debt, in which personal income taxes paid by the marginal investor in corporate debt just offset the corporate tax saving.”
What the sources say
- Supportedcites [27] 27. Miller, M., "Debt and Taxes," Journal of Finance, 32 (May 1977), 261-275. source
In Section IV, “Taxes and Market Equilibrium” (page unavailable), Miller describes an equilibrium level of aggregate corporate debt set by the intersection of bond demand and supply. The paper also explains that the bondholders’ personal-tax disadvantage can offset the corporate benefit of deductible interest one-for-one, leaving no gain from debt financing. (LLM, conf=0.91)
plaindirect- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim.
- Supported
Every source the paper cites for this claim was checked and supports it.
In the paper
“For example, Long and Malitz [21] found a significant negative relationship between rates of investment in advertising and research and development (R & D) and the level of borrowing.They also found a significant positive relationship between the rate of capital expenditure (in fixed plant and equipment) and the level of borrowing.”
What the sources say
- Supportedcites Long and Malitz [21] 21. Long, M. S., and E. B. Malitz, "Investment Patterns and Financial Leverage," Working Paper, National Bureau of Economic Research, 1983. source
Split into 2 atoms — 2 confirmed, 0 partially supported, 0 disputed, 0 misattributed, 0 unverifiable. Expand the claim to see per-atom verdicts.
plaincorrelational- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“However, any firm paying a lower rate would see a net loss to corporate borrowing and a net gain to lending.”
hedgeddirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“But our theories don't seem to explain actual financing behavior, and it seems presumptuous to advise firms on optimal capital structure when we are so far from explaining actual decisions.”
hedged- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim. It may be too vague to check against evidence. The paper may give no reason why it holds.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“However, there must be costs, and therefore lags, in adjusting to the optimum.”
plaindirect- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim. The paper may give no reason why it holds. It may state two separate claims as one.
In the paper
“We know stock prices respond to unanticipated dividend changes, so it is clear that dividends have information content-this observation dates back at least to Miller and Modigliani (MM) in 1961 [28].”
What the sources say
- Not checked — no full text of the sourcecites [28] 28. Miller, M., and F. Modigliani, "Dividend Policy, Growth and the Valuation of Shares," Journal of Business, 34 (October 1961), 411-433. "Some Estimates of the Cost of Capital to the Electric Utility Industry, 1954-1957," American Economic Review, 56 (June 1966), 333-391. source
boosteddirect- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“This fact is embarassing to static tradeoff advocates.If firm value rises, the debt-to-value ratio falls, and firms ought to issue debt, not equity, to rebalance their capital structures.”
plaindirect- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“For some firms this number is 46 cents, or close to it.At the other extreme, there are firms with large unused loss carryforwards which pay no immediate taxes.An extra dollar of interest paid by these firms would create only a potential future deduction, usable when and if the firm earns enough to work off prior carryforwards.The expected realizable tax shield is positive but small.”
plaincorrelational- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“If there were no costs of adjustment, and the static tradeoff theory is correct, then each firm's observed debt-to-value ratio should be its optimal ratio.”
plaindirect- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim. The paper may give no reason why it holds.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Given significant differences in effective marginal tax rates, and given that the static tradeoff theory works, we would expect to find a strong tax effect in any cross-sectional test, regardless of whose theory of debt and taxes you believe.”
hedgedcorrelational- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Thus the firm faces two increasing costs as it climbs up the pecking order: it faces higher odds of incurring costs of financial distress, and also higher odds that future positive-NPV projects will be passed by because the firm will be unwilling to finance them by issuing common stock or other risky securities.”
plaindirect- Asserted: passes — The authors put it forward as true.
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In the paper
“Masulis [23,24] has shown that stock prices rise, on average, when a firm offers to exchange debt for equity, and fall when they offer to exchange equity for debt.”
What the sources say
- Not matchedcites Masulis [23,24]
Couldn’t be matched to a paper in Crossref, so it can’t be checked.
boosteddirect- Asserted: passes — The authors put it forward as true.
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- Not matched
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Either firms take extended excursions from their targets, or the targets themselves depend on factors not yet recognized or understood.”
plain- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“However, the evidence on risk and debt policy is not extensive enough to be totally convincing.”
plain- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim. It may be too vague to check against evidence. The paper’s conclusions may not depend on it.
In the paper
“They adapt their target dividend payout ratios to their investment opportunities, although dividends are sticky and target payout ratios are only gradually adjusted to shifts in the extent of valuable investment opportunities.”
What the sources say
- Not matchedcites [13] 13. Donaldson, G., Corporate Debt Capacity: A Study of Corporate Debt Policy and the Determination of Corporate Debt Capacity, Boston, Division of Research, Harvard Graduate School of Business Administration, 1961.
Couldn’t be matched to a paper in Crossref, so it can’t be checked.
plaindirect- Asserted: passes — The authors put it forward as true.
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- Not matched
In the paper
“On average, stock price falls when firms announce a stock issue.Stock prices rise, on average, when a stock repurchase is announced.This fact has been confirmed in several studies, including those by Korwar [11].”
What the sources say
- Not matchedcites Korwar [11]
Couldn’t be matched to a paper in Crossref, so it can’t be checked.
boostedcorrelational- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“I know of no study clearly demonstrating that a firm's tax status has predictable, material effects on its debt policy.”
hedged- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim. It may be too vague to check against evidence. The paper may give no reason why it holds.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“For example, think of an unusually profitable firm in an industry generating relatively slow growth.That firm will end up with an unusually low debt ratio compared to its industry's average, and it won't do much of anything about it.”
plaindirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“However, a model based solely on this partial adjustment process would have a very low R2.Apparently the static tradeoff model captures only a small part of actual behavior.”
hedgeddirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“These results may make one a bit more comfortable with asymmetric information models of the kind sketched above, and thus a bit more comfortable with the pecking order story.”
hedged- Asserted: passes — The authors put it forward as true.
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Probably not a substantial claim. It may be too vague to check against evidence. It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“For example, there is no satisfactory explanation of debt covenants unless agency costs and moral hazard problems are recognized.”
plaindirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Book values reflect assets-in-place (tangible assets and working capital).Market values reflect intangibles and growth opportunities as well as assets-in-place.”
plaincorrelational- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“But I think it is generally consistent with the empirical evidence.”
hedgedcorrelational- Asserted: passes — The authors put it forward as true.
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The paper states this without a source or data behind it here, so there is nothing to check it against. The quote shows it is in the paper.
In the paper
“Costs of financial distress include the legal and administrative costs of bankruptcy, as well as the subtler agency, moral hazard, monitoring and contracting costs which can erode firm value even if formal default is avoided.”
plaindirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“But issue costs in themselves do not seem large enough to override the costs and benefits of leverage emphasized in the static tradeoff story.”
hedged- Asserted: passes — The authors put it forward as true.
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In the paper
“It restrains itself for two reasons: first, to avoid any material costs of financial distress; and second, to maintain financial slack in the form of reserve borrowing power.”
plaindirect- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“They do not want to run the risk of falling into the dilemma of either passing by positive-NPV projects or issuing stock at a price they think is too low.”
plain- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Any time an announcement affects stock price, we can infer that the announcement conveyed information.”
plaindirect- Asserted: passes — The authors put it forward as true.
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In the paper
“The static tradeoff story works to some extent, but it seems to have an unacceptably low R2.”
hedgedcorrelational- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Thus, firms do not set target book debt ratios because accountants certify the books.Book asset values are proxies for the values of assets in place.”
plaindirect- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Since many firms have market values far in excess of book values (even if those book values are restated in current dollars), we ought to see at least a few such firms operating comfortably at very high book debt ratios-and of course we do not.”
plain- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“Thus, although the theories tell different stories about aggregate supply and demand of corporate debt, they make essentially the same predictions about which firms borrow more or less than average.”
plain- Asserted: passes — The authors put it forward as true.
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A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“(If the manager's inside information is unfavorable, AN is negative and the firm will always issue, even if the only good use for the funds raised is to put them in the bank-a zero-NPV investment.”
plaindirect- Asserted: passes — The authors put it forward as true.
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It may state two separate claims as one.
- The authors state this as an assumption: The firm's manager knows x and y, while investors in capital markets do not and see only a joint distribution of possible values (x, y).
- The authors state this as an assumption: Aside from the information asymmetry, capital markets are perfect and semi-strong form efficient.
- The authors state this as an assumption: MM's Proposition I holds in the sense that the stock of debt relative to real assets is irrelevant if information available to investors is held constant.
- The authors state this as an assumption: The information asymmetry is taken as given.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“I have presented it just to show how models based on asymmetric information can predict the two central ideas of the pecking order story: first, the preference for internal finance, and, second, the preference for debt over equity if external financing is sought.”
plaindirect- Asserted: passes — The authors put it forward as true.
- Checkable: passes — It can be checked against evidence.
- Load-bearing: passes — The paper’s conclusions depend on it.
- Based: passes — The paper gives a reason why it holds.
It may state two separate claims as one.
- The authors state this as an assumption: The firm's manager knows x and y, while investors in capital markets do not and see only a joint distribution of possible values (x, y).
- The authors state this as an assumption: Aside from the information asymmetry, capital markets are perfect and semi-strong form efficient.
- The authors state this as an assumption: MM's Proposition I holds in the sense that the stock of debt relative to real assets is irrelevant if information available to investors is held constant.
- The authors state this as an assumption: The information asymmetry is taken as given.
A conclusion the paper draws from its own results — it cites no other source for it, so there is none to check. The quote shows it is in the paper.
In the paper
“because we lack an objective proxy for changes in the degree of asymmetry.”
plain- Asserted: passes — The authors put it forward as true.
- Checkable: fails — It may be too vague to check against evidence.
- Load-bearing: passes — The paper’s conclusions depend on it.
- Based: passes — The paper gives a reason why it holds.
Probably not a substantial claim. It may be too vague to check against evidence.
The authors state this as an assumption.
Managers have special information that investors do not have.
“if one starts by assuming that managers have special information, builds a model of how that information changes financing choices, and predicts which choices will be interpreted by investors as good or bad news, then some progress has been made.”
The authors state this as an assumption.
The customary assumptions of option pricing models hold when default risk is introduced.
“Even if default risk is introduced, the absolute value of AN will be less for debt than for equity if we make the customary assumptions of option pricing models.”
The authors state this as an assumption.
The firm's manager knows x and y, while investors in capital markets do not and see only a joint distribution of possible values (x, y).
“The firm's manager knows what x and y are, but investors in capital markets do not: they see only a joint distribution of possible values (x, y).”
The authors state this as an assumption.
Aside from the information asymmetry, capital markets are perfect and semi-strong form efficient.
“Aside from the information asymmetry, capital markets are perfect and semi-strong form efficient.”
The authors state this as an assumption.
MM's Proposition I holds in the sense that the stock of debt relative to real assets is irrelevant if information available to investors is held constant.
“MM's Proposition I holds in the sense that the stock of debt relative to real assets is irrelevant if information available to investors is held constant.”
The authors state this as an assumption.
Changes in firm value are lognormally distributed.
“This amounts to assuming that changes in firm value are lognormally distributed, that managers and investors agree on the variance rate, and that managers know the current value of x + y but investors do not.”
The authors state this as an assumption.
Managers and investors agree on the variance rate.
“This amounts to assuming that changes in firm value are lognormally distributed, that managers and investors agree on the variance rate, and that managers know the current value of x + y but investors do not.”
The authors state this as an assumption.
Managers know the current value of x + y but investors do not.
“This amounts to assuming that changes in firm value are lognormally distributed, that managers and investors agree on the variance rate, and that managers know the current value of x + y but investors do not.”
The authors state this as an assumption.
New shares or risky debt would be underpriced in the example.
“This example assumes that new shares or risky debt would be underpriced.”
The authors state this as an assumption.
If the firm always has a zero-NPV opportunity available to it, the distribution of y is truncated at y = 0.
“If the firm always has a zero-NPV opportunity available to it, the distribution of y is truncated at y = 0.”
The authors state this as an assumption.
x is non-negative.
“I also assume that x is non-negative.”
The authors state this as an assumption.
The information asymmetry is taken as given.
“The information asymmetry is taken as given.”
The authors state this as an assumption.
The information asymmetry applies to both the investment project and the firm without the project.
“The information asymmetry applies to both goods-for example, the manager may receive inside information that amounts to good news about x and bad news about y, or vice versa, or good or bad news about both.”
Self-check
Percentages, sums and reported differences re-computed from the paper’s own numbers.
Each contradiction between two passages listed here was confirmed by an independent check.
Rated minor: it would not touch a result — a value no result rests on, a p-value that stays on the same side of the significance level, or a conflict that is clerical, resolved elsewhere in the paper, or outside its own findings.
In the paper
§ The Journal of Finance
“This fact has been confirmed in several studies, including those by Korwar [11].”
§ References
“19. Korwar, A. N., "The Effect of New Issues of Equity: An Empirical Examination," Working Paper, University of California, Los Angeles, 1981.”
Rated minor: it would not touch a result — a value no result rests on, a p-value that stays on the same side of the significance level, or a conflict that is clerical, resolved elsewhere in the paper, or outside its own findings.
In the paper
§ Conclusion
“Jalilvand and Harris[16], for example.”
§ References
“17. Jalilvand, A. and R. S. Harris, "Corporate Behavior in Adjusting Capital Structure and Dividend Policy: An Econometric Study," Journal of Finance, 39 (March 1984), 127-145.”
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O’Connor, G. C. (1994) · Journal of Strategic Marketing · doi:10.1080/09652549400000001 · Cited by 22
Buffer stock money and pecking order financing: Results from an interview study among Dutch firms
de Haan, L., Koedijk, K. C. G., & Vrijer, J. E. J. D. (1994) · De Economist · doi:10.1007/bf01431974 · Cited by 21
Metadata
- Authors
- MYERS, S. C.
- Affiliations
- National Bureau of Economic Research (US)
- Corresponding author
- MYERS, STEWART C.
- Venue
- The Journal of Finance
- Publisher
- Wiley
- Published
- 1984-07
- Volume
- 39
- Issue
- 3
- Pages
- 574-592
- ISSN
- 0022-1082 (ISSN-L)
- 1540-6261
- OpenAlex
- W2170790204
- Cited by
- 7,526
- References
- 43
- Citations by year
- 2026: 117 · 2025: 159 · 2024: 234 · 2023: 324 · 2022: 285 · 2021: 381 · 2020: 413 · 2019: 391 · 2018: 381 · 2017: 342 · 2016: 391 · 2015: 439 · 2014: 394 · 2013: 378 · 2012: 376
- FWCI
- 102.04
- Type
- journal article
- Language
- en
- Open access
- bronze
- doi.org
- Locations
- The Journal of Finance (publishedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Finance › Corporate Finance and Governance
- Social Sciences › Business, Management and Accounting › Accounting › Financial Analysis and Corporate Governance
- Social Sciences › Business, Management and Accounting › Strategy and Management › Financial Reporting and Valuation Research
- Keywords
- capital structure puzzle, managerial capitalism, separation of ownership and control, agency theory, corporate financing decisions, investment decision-making, Modigliani-Miller theorem
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
A language model drew the claims from the paper on 2026-10-11, under version 3 of the claim definition (model deepseek-v4.1-flash, prompt extract-v3).
A second model labelled each claim on 2026-10-11 (model jev-1.13-20260917, definition revision gold-guideline-v0.2).
Cited sources are checked with a language model’s help (gpt-6-sol).
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
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