Transparency and Financing Choices of Family Firms

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journal

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Original languageEnglish
Pages (from-to)381-408
Journal / PublicationJournal of Financial and Quantitative Analysis
Volume49
Issue number2
Publication statusPublished - Apr 2014

Abstract

While recent literature has documented that U.S. family firms differ markedly from their non-family counterparts, there is a paucity of evidence on how these firms differ in terms of their cost of capital or financial structure. In this paper, we show that family and non-family firms differ in their debt maturity and leverage ratios in a manner consistent with the higher expropriation potential of family firms. Moreover, while more transparency causes both family and non-family firms to increase the maturity structure of their debt and reduce leverage ratios, the effects are stronger for family firms.

Citation Format(s)

Transparency and Financing Choices of Family Firms. / Chen, Tai-Yuan; Dasgupta, Sudipto; Yu, Yangxin.

In: Journal of Financial and Quantitative Analysis, Vol. 49, No. 2, 04.2014, p. 381-408.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journal