Do Asset Fire Sales Exist? An Empirical Investigation of Commercial Aircraft Transactions
This paper uses commercial aircraft transactions to determine whether capital constraints cause firms to liquidate assets at discounts to fundamental values. Results indicate that financially constrained airlines receive lower prices than their unconstrained rivals when selling used narrow-body airc...
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| Veröffentlicht in: | The Journal of finance (New York) 1998-06, Vol.53 (3), p.939-978 |
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| container_end_page | 978 |
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| container_issue | 3 |
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| container_title | The Journal of finance (New York) |
| container_volume | 53 |
| creator | Pulvino, Todd C. |
| description | This paper uses commercial aircraft transactions to determine whether capital constraints cause firms to liquidate assets at discounts to fundamental values. Results indicate that financially constrained airlines receive lower prices than their unconstrained rivals when selling used narrow-body aircraft. Capital constrained airlines are also more likely to sell used aircraft to industry outsiders, especially during market downturns. Further evidence that capital constraints affect liquidation prices is provided by airlines' asset acquisition activity. Unconstrained airlines significantly increase buying activity when aircraft prices are depressed; this pattern is not observed for financially constrained airlines. |
| doi_str_mv | 10.1111/0022-1082.00040 |
| format | Article |
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Unconstrained airlines significantly increase buying activity when aircraft prices are depressed; this pattern is not observed for financially constrained airlines.</description><subject>Air transportation industry</subject><subject>Aircraft</subject><subject>Airlines</subject><subject>Asset acquisitions</subject><subject>Book value</subject><subject>Capital assets</subject><subject>Capital structure</subject><subject>Commercial aircraft</subject><subject>Debt capacity</subject><subject>Discounts</subject><subject>Financial institutions</subject><subject>Financial transactions</subject><subject>Hypotheses</subject><subject>Industrial market</subject><subject>Liquidation</subject><subject>Regression analysis</subject><subject>Resale value</subject><subject>Standard error</subject><subject>Studies</subject><issn>0022-1082</issn><issn>1540-6261</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>1998</creationdate><recordtype>article</recordtype><recordid>eNqFkM1PwyAYh4nRxPlx9uCFeK9CgcJOps5NZxZnYv06EYpgmFs7ofPjv5daM4--Fw7P74GXHwAHGB3jOCcIpWmCkUiPEUIUbYAeZhQlWZrhTdBb022wE8IMtcNYDzyd1zAPwTRw5LyBt2puAhx-utCcwryCw8XSeafVHI6rdxMa96IaV1ewtnBQLxbGaxdZ7rz2yjaw8KoKSreRsAe2rJoHs_977oK70bAYXCaT6cV4kE8SzRBHCSdKqL4uU0q5ZaYkJLUlUf1Mq8xSLgR6ZsqmFrNUE4FLRDIrkKaECa1wyckuOOruXfr6bRV3lLN65av4pMR9yjGN_4yhky6kfR2CN1YuvVso_yUxkm19si1ItgXJn_qiQTvjw83N139xeTUdjTvtsNNmoan9n4Y5ESTSpKOxX_O5psq_yowTzuTD9YUszorBzf2jkCPyDURWiHk</recordid><startdate>199806</startdate><enddate>199806</enddate><creator>Pulvino, Todd C.</creator><general>Blackwell Publishers Inc</general><general>Blackwell Publishers, Inc</general><scope>BSCLL</scope><scope>AAYXX</scope><scope>CITATION</scope><scope>8BJ</scope><scope>FQK</scope><scope>JBE</scope></search><sort><creationdate>199806</creationdate><title>Do Asset Fire Sales Exist? 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An Empirical Investigation of Commercial Aircraft Transactions</atitle><jtitle>The Journal of finance (New York)</jtitle><date>1998-06</date><risdate>1998</risdate><volume>53</volume><issue>3</issue><spage>939</spage><epage>978</epage><pages>939-978</pages><issn>0022-1082</issn><eissn>1540-6261</eissn><coden>JLFIAN</coden><abstract>This paper uses commercial aircraft transactions to determine whether capital constraints cause firms to liquidate assets at discounts to fundamental values. Results indicate that financially constrained airlines receive lower prices than their unconstrained rivals when selling used narrow-body aircraft. Capital constrained airlines are also more likely to sell used aircraft to industry outsiders, especially during market downturns. Further evidence that capital constraints affect liquidation prices is provided by airlines' asset acquisition activity. Unconstrained airlines significantly increase buying activity when aircraft prices are depressed; this pattern is not observed for financially constrained airlines.</abstract><cop>Boston, USA and Oxford, UK</cop><pub>Blackwell Publishers Inc</pub><doi>10.1111/0022-1082.00040</doi><tpages>40</tpages><oa>free_for_read</oa></addata></record> |
| fulltext | fulltext |
| identifier | ISSN: 0022-1082 |
| ispartof | The Journal of finance (New York), 1998-06, Vol.53 (3), p.939-978 |
| issn | 0022-1082 1540-6261 |
| language | eng |
| recordid | cdi_proquest_journals_194714055 |
| source | Jstor Complete Legacy; Wiley Online Library Journals Frontfile Complete |
| subjects | Air transportation industry Aircraft Airlines Asset acquisitions Book value Capital assets Capital structure Commercial aircraft Debt capacity Discounts Financial institutions Financial transactions Hypotheses Industrial market Liquidation Regression analysis Resale value Standard error Studies |
| title | Do Asset Fire Sales Exist? An Empirical Investigation of Commercial Aircraft Transactions |
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