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Growth opportunities, capital structure and dividend policies in Japan

journal contribution
posted on 1999-06-01, 00:00 authored by Ferdinand GulFerdinand Gul
This paper, using 5308 observations of listed Japanese firms between the years 1988– 1992, provides additional evidence on contracting theory arguments for the relation between growth opportunities, capital structure and dividend policies. To avoid the problems of using cross-sectional proxies for time-sequenced variables, this study uses 1 pooled Ž . cross-sectional time-series analysis and 2 time-series analysis with a one-year lag for the Ž . dependent variables. Results show significant negative relations between growth opportunities and levels of both debt financing and dividend yields after controlling for firm size, profitability, firm keiretsu affiliations and industry regulation. The results are consistent with contracting cost arguments for corporate finance and dividend policies and confirm the importance of growth opportunities in corporate finance theory.

History

Journal

Journal of corporate finance

Volume

5

Pagination

141-168

Location

Amsterdam, The Netherlands

ISSN

0929-1199

Language

eng

Publication classification

C Journal article, C1.1 Refereed article in a scholarly journal

Copyright notice

1999, Elsevier Science B.V.

Issue

2

Publisher

Elsevier

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