Co-opted boards and capital structure dynamics

Endogeneity Problem in Corporate Finance: Theory and Practice

“…Flannery, Hankins [5] и Dang et al [26] показали, что более эффективные оценки получаются только при применении бутстрап (bootstrap) техники для модели с фиксированным эффектом. Тем не менее метод BB на текущий момент востребован среди исследователей [6,[52][53][54].…”

Competence and enterprise of management as drivers of early foreign listing of medium-sized emerging market multinationals (EMNEs) from Africa

“…Despite the critical role of the board in firm internationalisation decision-making, past and present research on the subject is predominantly rooted in the accounting and finance literature. In addition, they are biased towards developed economies with well-functioning corporate governance systems (e.g., Bushman & Smith, 2001;Garcia-Sanchez et al, 2017;Lartey et al, 2021).…”

“…Whilst the executive board of directors are the ones who typically vet, approve and initiate decisions for locating major international activities abroad (Killing, 2017;Garcia-Sanchez et al, 2017;Lartey et al, 2021), empirical analysis on corporate governance structures, board outsidership and its impact on early international expansion activities in and out of Africa is generally missing. Hence, its investigation is timely for international business and management research on Africa.…”

Firm-level political risk and corporate leverage decisions

“…The purpose of this study is to examine how firm-level political risk influences leverage decisions and speed of adjustment to target capital of US firms over a period of 2002-2019. From the perspective of the capital structure literature, prior research has progressed along various important directions, ranging from the agency theoretical perspective (Jensen and Meckling, 1976;Morellec et al, 2012) to the trade-off, which contends that a firm's optimal leverage choice is driven by balancing the costs against the benefits of increased debt (Frank and Goyal, 2009). Lartey, Danso and Boateng (2021), Lartey, Kesse and Danso (2020) and Morellec et al (2012) document that various mechanisms are associated with the use of both long-and short-term debt, emphasising that the choice of capital structure should not only be driven by costs of capital, taxes, and bankruptcy costs, but also a country's environment factors. For example, political uncertainty heightens information asymmetry, thereby making it difficult to forecast a firm's future cash flows (Julio and Yook, 2012;Gungoraydinoglu, Çolak, and Öztekin, 2017).…”

“…Therefore, examining the firm-level political risk-capital structure relationship is of particular importance to managers and policy makers for several reasons. First, political risk affects a firm's cash flow volatility, risk of default and economic outcomes (Lartey et al, 2021;Cremers & Yan, 2010) and understanding how political risk could hinder or facilitate a firm's adjustment speed to target capital structure and investment decisions can help to mitigate its effects on the firm's economic outcomes. Second, the impact of political risk stemming from changes in government policies on firms is hard to diversify, yet it affects the real investment and gross domestic product (GDP) of a country (Aizenman & Marion, 2004;Born & Pfeifer, 2014).…”