Earticle

초록

영어

I examine the simultaneous associations between institutional ownership and capital structure of a firm. I find that a firm’s leverage decreases when institutional ownership increases. This result implies that a firm reduces its debt level as institutional monitoring substitutes for the external debt monitoring, and indirectly suggests institutional investors’ activism. More importantly, I also find that a firm’s suboptimal leverage increases when the institutional ownership increases, and institutional ownership decreases when a firm’s suboptimal leverage increases. This finding directly shows that institutional investors not only actively monitor the management but they also passively sell their shares when dissatisfied with the management. In addition, I find that the monitoring evidence on a firm’s leverage and suboptimal leverage are more pronounced when the institutional investors are less likely to have business relationships with a firm or the information asymmetry is high in the market.

목차

ABSTRACT
 1. Introduction
 2. Testable hypotheses
  2.1. Interrelationship between institutional ownership and capital structure
  2.2. Institutional monitoring hypotheses
 3. Sample and methodology
  3.1. Sample construction and description
 4. Empirical results
  4.1. Indirect evidence of institutional monitoring: institutional monitoring as substitute for debt monitoring
  4.2. Direct evidence of institutional monitoring: active and passive institutional monitoring on suboptimal capital structure
  4.3. Is institutional active monitoring on suboptimal capital structure related to a firm performance?
 5. Conclusion
 References
 Table
 Figure

키워드

저자

• Chune Young Chung [ College of Business Administration, Kookmin University ]

참고문헌

발행기관

간행물

표지보기 관심저널 등록

• 간행물명

  한국재무학회 학술대회

• 간기

  부정기

• 수록기간

  2006~2024

• 십진분류

  KDC 325 DDC 330