The effect of leverage on bargaining with a corporation

The effect of leverage on bargaining with a corporation

This paper shows that the choice of a capital structure by a firm affects the bargaining posture of its shareholders vis‐a‐vis its suppliers of specialized production factors. The pricing of the firm's securities and the choice of a capital structure are analyzed in light of this effect of debt...

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Veröffentlicht in:The Financial review (Buffalo, N.Y.) N.Y.), 1998-02, Vol.33 (1), p.1-16
1. Verfasser: Sarig, Oded H.
Format: Artikel
Sprache:eng
Schlagworte:
Bargaining
Capital structure
Corporate finance
Debt financing
Studies
Wages & salaries
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Beschreibung
Zusammenfassung:This paper shows that the choice of a capital structure by a firm affects the bargaining posture of its shareholders vis‐a‐vis its suppliers of specialized production factors. The pricing of the firm's securities and the choice of a capital structure are analyzed in light of this effect of debt financing.
ISSN:0732-8516
1540-6288
DOI:10.1111/j.1540-6288.1998.tb01603.x