TITLE

An Empirical Analysis of the Determinants of Corporate Debt Ownership Structure

AUTHOR(S)
Johnson, Shane A.
PUB. DATE
March 1997
SOURCE
Journal of Financial & Quantitative Analysis;Mar1997, Vol. 32 Issue 1, p47
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
I examine the relation between corporate debt ownership structure and several firm characteristics suggested by recent theory. The results demonstrate the importance of monitoring and information costs, the likelihood and costs of inefficient liquidation, and borrowers' incentives in affecting firms' debt source preferences. Several theoretical predictions receive support, while others do not. The results also suggest important differences between bank and private non-bank debt, which contrasts with most theoretical models. Additionally, I find evidence of systematic use of bank debt by firms with access to public debt, suggesting the benefits attributed to bank debt in theoretical models remain important after firms gain access to public debt markets. Although different lenders appear to have different maturity preferences, the results also suggest debt maturity and debt ownership decisions may be separable.
ACCESSION #
9706060943

 

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