资本结构的选择的决定因素【外文翻译】.doc

1、外文文献翻译译文一、外文原文原文THEDETERMINANTSOFCAPITALSTRUCTURECHOICETHEBASICAPPROACHTAKENINPREVIOUSEMPIRICALWORKHASBEENTOESTIMATEREGRESSIONEQUATIONSWITHPROXIESFORTHEUNOBSERVABLETHEORETICALATTRIBUTESTHISAPPROACHHASANUMBEROFPROBLEMSFIRST,THEREMAYBENOUNIQUEREPRESENTATIONOFTHEATTRIBUTESWEWISHTOMEASURETHEREAREOFTENMA

2、NYPOSSIBLEPROXIESFORAPARTICULARATTRIBUTE,ANDRESEARCHERS,LACKINGTHEORETICALGUIDELINES,MAYBETEMPTEDTOSELECTTHOSEVARIABLESTHATWORKBESTINTERMSOFSTATISTICALGOODNESSOFFITCRITERIA,THEREBYBIASINGTHEIRINTERPRETATIONOFTHESIGNIFICANCELEVELSOFTHEIRTESTSSECOND,ITISOFTENDIFFICULTTOFINDMEASURESOFPARTICULARATTRIBUT

3、ESTHATAREUNRELATEDTOOTHERATTRIBUTESTHATAREOFINTERESTTHUS,SELECTEDPROXYVARIABLESMAYBEMEASURINGTHEEFFECTSOFSEVERALDIFFERENTATTRIBUTESTHIRD,SINCETHEOBSERVEDVARIABLESAREIMPERFECTREPRESENTATIONSOFTHEATTRIBUTESTHEYARESUPPOSEDTOMEASURE,THEIRUSEINREGRESSIONANALYSISINTRODUCESANERRORSINVARIABLEPROBLEMFINALLY,

4、MEASUREMENTERRORSINTHEPROXYVARIABLESMAYBECORRELATEDWITHMEASUREMENTERRORSINTHEDEPENDENTVARIABLES,CREATINGSPURIOUSCORRELATIONSEVENWHENTHEUNOBSERVEDATTRIBUTEBEINGMEASUREDISUNRELATEDTOTHEDEPENDENTVARIABLETHISSTUDYEXTENDSEMPIRICALWORKONCAPITALSTRUCTURETHEORYINTHREEWAYSFIRST,ITEXTENDSTHERANGEOFTHEORETICAL

5、DETERMINANTSOFCAPITALSTRUCTUREBYEXAMININGSOMERECENTLYDEVELOPEDTHEORIESTHATHAVENOT,ASYET,BEENANALYZEDEMPIRICALLYSECOND,SINCESOMEOFTHESETHEORIESHAVEDIFFERENTEMPIRICALIMPLICATIONSWITHREGARDTODIFFERENTTYPESOFDEBTINSTRUMENTS,WEANALYZESEPARATEMEASURESOFSHORTTERM,LONGTERM,ANDCONVERTIBLEDEBTRATHERTHANANAGGR

6、EGATEMEASUREOFTOTALDEBTTHIRD,ATECHNIQUEISUSEDTHATEXPLICITLYRECOGNIZESANDMITIGATESTHEMEASUREMENTPROBLEMSDISCUSSEDABOVETHISTECHNIQUE,WHICHISANEXTENSIONOFTHEFACTORANALYTICAPPROACHTOMEASURINGUNOBSERVEDORLATENTVARIABLES,ISKNOWNASLINEARSTRUCTURALMODELINGVERYBRIEFLY,THISMETHODASSUMESTHAT,ALTHOUGHTHERELEVAN

7、TATTRIBUTESARENOTDIRECTLYOBSERVABLE,WECANOBSERVEANUMBEROFINDICATORVARIABLESTHATARELINEARFUNCTIONSOFONEORMOREATTRIBUTESANDARANDOMERRORTERMTHEREIS,INTHISSPECIFICATION,ADIRECTANALOGYWITHTHERETURNGENERATINGPROCESSASSUMEDTOHOLDINTHEARBITRAGEPRICINGTHEORYWHILETHEIDENTIFYINGRESTRICTIONSIMPOSEDONOURMODELARE

8、DIFFERENT,THETECHNIQUEFORESTIMATINGITISVERYSIMILARTOTHEPROCEDUREUSEDBYROLLANDROSSTOTESTTHEAPTOURRESULTSSUGGESTTHATFIRMSWITHUNIQUEORSPECIALIZEDPRODUCTSHAVERELATIVELYLOWDEBTRATIOSUNIQUENESSISCATEGORIZEDBYTHEFIRMSEXPENDITURESONRESEARCHANDDEVELOPMENT,SELLINGEXPENSES,ANDTHERATEATWHICHEMPLOYEESVOLUNTARILY

9、LEAVETHEIRJOBSWEALSOFINDTHATSMALLERFIRMSTENDTOUSESIGNIFICANTLYMORESHORTTERMDEBTTHANLARGERFIRMSOURMODELEXPLAINSVIRTUALLYNONEOFTHEVARIATIONINCONVERTIBLEDEBTRATIOSACROSSFIRMSANDFINDSNOEVIDENCETOSUPPORTTHEORETICALWORKTHATPREDICTSTHATDEBTRATIOSARERELATEDTOAFIRMSEXPECTEDGROWTH,NONDEBTTAXSHIELDS,VOLATILITY

10、,ORTHECOLLATERALVALUEOFITSASSETSWEDO,HOWEVER,FINDSOMESUPPORTFORTHEPROPOSITIONTHATPROFITABLEFIRMSHAVERELATIVELYLESSDEBTRELATIVETOTHEMARKETVALUEOFTHEIREQUITYDETERMINANTSOFCAPITALSTRUCTUREINTHISSECTION,WEPRESENTABRIEFDISCUSSIONOFTHEATTRIBUTESTHATDIFFERENTTHEORIESOFCAPITALSTRUCTURESUGGESTMAYAFFECTTHEFIR

11、MSDEBTEQUITYCHOICETHESEATTRIBUTESAREDENOTEDASSETSTRUCTURE,NONDEBTTAXSHIELDS,GROWTH,UNIQUENESS,INDUSTRYCLASSIFICATION,SIZE,EARNINGSVOLATILITY,ANDPROFITABILITYTHEATTRIBUTES,THEIRRELATIONTOTHEOPTIMALCAPITALSTRUCTURECHOICE,ANDTHEIROBSERVABLEINDICATORSAREDISCUSSEDBELOWACOLLATERALVALUEOFASSETSMOSTCAPITALS

12、TRUCTURETHEORIESARGUETHATTHETYPEOFASSETSOWNEDBYAFIRMINSOMEWAYAFFECTSITSCAPITALSTRUCTURECHOICESCOTTSUGGESTSTHAT,BYSELLISECUREDDEBT,FIRMSINCREASETHEVALUEOFTHEIREQUITYBYEXPROPRIATINGWEALTHFROMTHEIREXISTINGUNSECUREDCREDITORARGUMENTSPUTFORTHBYMYERSANDMAJLUFALSOSUGGESTTHATFIRMSMAYFINDITADVANTAGEOUSTOSELLS

13、ECUREDDEBTTHEIRMODELDEMONSTRATESTHATTHEREMAYBECOSTSASSOCIATEDWITHISSUINGSECURITIESABOUTWHICHTHEFIRMSMANAGERSHAVEBETTERINFORMATIONTHANOUTSIDESHAREHOLDERSISSUINGDEBTSECUREDBYPROPERTYWITHKNOWNVALUESAVOIDSTHESECOSTSFORTHISREASON,FIRMSWITHASSETSTHATCANBEUSEDASCOLLATERALMAYBEEXPECTEDTOISSUEMOREDEBTTOTAKEA

14、DVANTAGEOFTHISOPPORTUNITYWORKBYGALAIANDMASULIS,JENSENANDMECKLING,ANDMYERSSUGGESTSTHATSTOCKHOLDERSOFLEVERAGEDFIRMSHAVEANINCENTIVETOINVESTSUBOPTIMALLYTOEXPROPRIATEWEALTHFROMTHEFIRMSBONDHOLDERSTHISINCENTIVEMAYALSOINDUCEAPOSITIVERELATIONBETWEENDEBTXATIOSANDTHECAPACITYOFFIRMSTOCOLLATERALIZETHEIRDEBTIFTHE

15、DEBTCANBECOLLATERALIZED,THEBORROWERISRESTRICTEDTOUSETHEFUNDSFORASPECIFIEDPROJECTSINCENOSUCHGUARANTEECANBEUSEDFORPROJECTSTHATCANNOTBECOLLATERALIZED,CREDITORSMAYREQUIREMOREFAVORABLETERMS,WHICHINTURNMAYLEADSUCHFIRMSTOUSEEQUITYRATHERTHANDEBTFINANCINGTHETENDENCYOFMANAGERSTOCONSUMEMORETHANTHEOPTIMALLEVELO

16、FPERQUISITESMAYPRODUCETHEOPPOSITERELATIONBETWEENCOLLATERALIZABLECAPITALANDDEBTLEVELSGROSSMANANDHARTSUGGESTTHATHIGHERDEBTLEVELSDIMINISHTHISTENDENCYBECAUSEOFTHEINCREASEDTHREATOFBANKRUPTCYMANAGERSOFHIGHLYLEVEREDFIRMSWILLALSOBELESSABLETOCONSUMEEXCESSIVEPERQUISITESSINCEBONDHOLDERSORBANKERSAREINCLINEDTOCL

17、OSELYMONITORSUCHFIRMSTHECOSTSASSOCIATEDWITHTHISAGENCYRELATIONMAYBEHIGHERFORFIRMSWITHASSETSTHATARELESSCOLLATERALIZABLESINCEMONITORINGTHECAPITALOUTLAYSOFSUCHFIRMSISPROBABLYMOREDIFFICULTFORTHISREASON,FIRMSWITHLESSCOLLATERALIZABLEASSETSMAYCHOOSEHIGHERDEBTLEVELSTOLIMITTHEIRMANAGERSCONSUMPTIONOFPERQUISITE

18、STHEESTIMATEDMODELINCORPORATESTWOINDICATORSFORTHECOLLATERALVALUEATTRIBUTETHEYINCLUDETHERATIOOFINTANGIBLEASSETSTOTOTALASSETSINTITAANDTHERATIOOFINVENTORYPLUSGROSSPLANTANDEQUIPMENTTOTOTALASSETSIGPITATHEFIRSTINDICATORISNEGATIVELYRELATEDTOTHECOLLATERALVALUEATTRIBUTE,WHILETHESECONDISPOSITIVELYRELATEDTOCOL

19、LATERALVALUEBNONDEBTTAXSHIELDSDEANGELOANDMASULISPRESENTAMODELOFOPTIMALCAPITALSTRUCTURETHATINCORPORATESTHEIMPACTOFCORPORATETAXES,PERSONALTAXES,ANDNONDEBTRELATEDCORPORATETAXSHIELDSTHEYARGUETHATTAXDEDUCTIONSFORDEPRECIATIONANDINVESTMENTTAXCREDITSARESUBSTITUTESFORTHETAXBENEFITSOFDEBTFINANCINGASARESULT,FI

20、RMSWITHLARGENONDEBTTAXSHIELDSRELATIVETOTHEIREXPECTEDCASHFLOWINCLUDELESSDEBTINTHEIRCAPITALSTRUCTURESINDICATORSOFNONDEBTTAXSHIELDSINCLUDETHERATIOSOFINVESTMENTTAXCREDITSOVERTOTALASSETSITCITA,DEPRECIATIONOVERTOTALASSETSDITA,ANDADIRECTESTIMATEOFNONDEBTTAXSHIELDSOVERTOTALASSETSNDTITATHELATTERMEASUREISCALC

21、ULATEDFROMOBSERVEDFEDERALINCOMETAXPAYMENTST,OPERATINGINCOMEOI,INTERESTPAYMENTSI,ANDTHECORPORATETAXRATEDURINGOURSAMPLEPERIOD48,USINGTHEFOLLOWINGEQUATIONNDTOIIT/048WHICHFOLLOWSFROMTHEEQUALITYT048OIINDTTHESEINDICATORSMEASURETHECURRENTTAXDEDUCTIONSASSOCIATEDWITHCAPITALEQUIPMENTAND,HENCE,ONLYPARTIALLYCAP

22、TURETHENONDEBTTAXSHIELDVARIABLESUGGESTEDBYDEANGELOANDMASULISFIRST,THISATTRIBUTEEXCLUDESTAXDEDUCTIONSTHATARENOTASSOCIATEDWITHCAPITALEQUIPMENT,SUCHASRESEARCHANDDEVELOPMENTANDSELLINGEXPENSESTHESEVARIABLES,USEDASINDICATORSOFANOTHERATTRIBUTE,AREDISCUSSEDLATERMOREIMPORTANT,OURNONDEBTTAXSHIELDATTRIBUTEREPR

23、ESENTSTAXDEDUCTIONSRATHERTHANTAXDEDUCTIONSNETOFTRUEECONOMICDEPRECIATIONANDEXPENSES,WHICHISTHEECONOMICATTRIBUTESUGGESTEDBYTHEORYUNFORTUNATELY,THISPREFERABLEATTRIBUTEWOULDBEVERYDIFFICULTTOMEASURECGROWTHASWEMENTIONEDPREVIOUSLY,EQUITYCONTROLLEDFIRMSHAVEATENDENCYTOINVESTSUBOPTIMALLYTOEXPROPRIATEWEALTHFRO

24、MTHEFIRMSBONDHOLDERSTHECOSTASSOCIATEDWITHTHISAGENCYRELATIONSHIPISLIKELYTOBEHIGHERFORFIRMSINGROWINGINDUSTRIES,WHICHHAVEMOREFLEXIBILITYINTHEIRCHOICEOFFUTUREINVESTMENTSEXPECTEDFUTUREGROWTHSHOULDTHUSBENEGATIVELYRELATEDTOLONGTERMDEBTLEVELSMYERS,HOWEVER,NOTEDTHATTHISAGENCYPROBLEMISMITIGATEDIFTHEFIRMISSUES

25、SHORTTERMRATHERTHANLONGTERMDEBTTHISSUGGESTSTHATSHORTTERMDEBTRATIOSMIGHTACTUALLYBEPOSITIVELYRELATEDTOGROWTHRATESIFGROWINGFIRMSSUBSTITUTESHORTTERMFINANCINGFORLONGTERMFINANCINGJENSENANDMECKLING,SMITHANDWARNER,ANDGREENARGUEDTHATTHEAGENCYCOSTSWILLBEREDUCEDIFFIRMSISSUECONVERTIBLEDEBTTHISSUGGESTSTHATCONVER

26、TIBLEDEBTRATIOSMAYBEPOSITIVELYRELATEDTOGROWTHOPPORTUNITIESITSHOULDALSOBENOTEDTHATGROWTHOPPORTUNITIESARECAPITALASSETSTHATADDVALUETOAFIRMBUTCANNOTBECOLLATERALIZEDANDDONOTGENERATECURRENTTAXABLEINCOMEFORTHISREASON,THEARGUMENTSPUTFORTHINTHEPREVIOUSSUBSECTIONSALSOSUGGESTANEGATIVERELATIONBETWEENDEBTANDGROW

27、THOPPORTUNITIESINDICATORSOFGROWTHINCLUDECAPITALEXPENDITURESOVERTOTALASSETSCEITAANDTHEGROWTHOFTOTALASSETSMEASUREDBYTHEPERCENTAGECHANGEINTOTALASSETSGTASINCEFIRMSGENERALLYENGAGEINRESEARCHANDDEVELOPMENTTOGENERATEFUTUREINVESTMENTS,RESEARCHANDDEVELOPMENTOVERSALESRDISALSOSERVESASANINDICATOROFTHEGROWTHATTRI

28、BUTEDUNIQUENESSTITMANPRESENTSAMODELINWHICHAFIRMSLIQUIDATIONDECISIONISCAUSALLYLINKEDTOITSBANKRUPTCYSTATUSASARESULT,THECOSTSTHATFIRMSCANPOTENTIALLYIMPOSEONTHEIRCUSTOMERS,SUPPLIERS,ANDWORKERSBYLIQUIDATINGARERELEVANTTOTHEIRCAPITALSTRUCTUREDECISIONSCUSTOMERS,WORKERS,ANDSUPPLIERSOFFIRMSTHATPRODUCEUNIQUEOR

29、SPECIALIZEDPRODUCTSPROBABLYSUFFERRELATIVELYHIGHCOSTSINTHEEVENTTHATTHEYLIQUIDATETHEIRWORKERSANDSUPPLIERSPROBABLYHAVEJOBSPECIFICSKILLSANDCAPITAL,ANDTHEIRCUSTOMERSMAYFINDITDIFFICULTTOFINDALTERNATIVESERVICINGFORTHEIRRELATIVELYUNIQUEPRODUCTSFORTHESEREASONS,UNIQUENESSISEXPECTEDTOBENEGATIVELYRELATEDTODEBTR

30、ATIOSINDIATORSOFUNIQUENESSINCLUDEEXPENDITURESONRESEARCHANDDEVELOPMENTOVERSALESRDIS,SELLINGEXPENSESOVERSALESSEIS,ANDQUITRATESQR,THEPERCENTAGEOFTHEINDUSTRYSTOTALWORKFORCETHATVOLUNTARILYLEFTTHEIRJOBSINTHESAMPLEYEARSITISPOSTULATEDTHATRDISMEASURESUNIQUENESSBECAUSEFIRMSTHATSELLPRODUCTSWITHCLOSESUBSTITUTES

31、ARKLIKELYTODOLESSRESEARCHANDDEVELOPMENTSINCETHEIRINNOVATIONSCANBEMOREEASILYDUPLICATEDINADDITION,SUCCESSFULRESEARCHANDDEVELOPMENTPROJECTSLEADTONEWPRODUCTSTHATDIFFERFROMTHOSEEXISTINGINTHEMARKETFIRMSWITHRELATIVELYUNIQUEPRODUCTSAREEXPECTEDTOADVERTISEMOREAND,INGENERAL,SPENDMOREINPROMOTINGANDSELLINGTHEIRP

32、RODUCTSHENCE,SEISISEXPECTEDTOBEPOSITIVELYRELATEDTOUNIQUENESSHOWEVER,ITISEXPECTEDTHATFIRMSININDUSTRIESWITHHIGHQUITRATESAREPROBABLYRELATIVELYLESSUNIQUESINCEFIRMSTHATPRODUCERELATIVELYUNIQUEPRODUCTSTENDTOEMPLOYWORKERSWITHHIGHLEVELSOFJOBSPECIFICHUMANCAPITALWHOWILLTHUSFINDITCOSTLYTOLEAVETHEIRJOBSITISAPPAR

33、ENTFROMTWOOFTHEINDICATORSOFUNIQUENESS,RDISANDSEIS,THATTHISATTRIBUTEMAYALSOBERELATEDTONONDEBTTAXSHIELDSANDCOLLATERALVALUERESEARCHANDDEVELOPMENTANDSOMESELLINGEXPENSESSUCHASADVERTISINGCANBECONSIDEREDCAPITALGOODSTHATAREIMMEDIATELYEXPENSEDANDCANNOTBEUSEDASCOLLATERALGIVENTHATOURESTIMATIONTECHNIQUECANONLYI

34、MPERFECTLYCONTROLFORTHESEOTHERATTRIBUTES,THEUNIQUENESSATTRIBUTEMAYBENEGATIVELYRELATEDTOTHEOBSERVEDDEBTRATIOBECAUSEOFITSPOSITIVECORRELATIONWITHNONDEBTTAXSHIELDSANDITSNEGATIVECORRELATIONWITHCOLLATERALVALUEEINDUSTRYCLASSIFICATIONTITMANSUGGESTSTHATFIRMSTHATMAKEPRODUCTSREQUIRINGTHEAVAILABILITYOFSPECIALIZ

35、EDSERVICINGANDSPAREPARTSWILLFINDLIQUIDATIONESPECIALLYCOSTLYTHISINDICATESTHATFIRMSMANUFACTURINGMACHINESANDEQUIPMENTSHOULDBEFINANCEDWITHRELATIVELYLESSDEBTTOMEASURETHIS,WEINCLUDEADUMMYVARIABLEEQUALTOONEFORFIRMSWITHSICCODESBETWEEN3400AND4000FIRMSPRODUCINGMACHINESANDEQUIPMENTANDZEROOTHERWISEASASEPARATEAT

36、TRIBUTEAFFECTINGTHEDEBTRATIOSFSIZEANUMBEROFAUTHORSHAVESUGGESTEDTHATLEVERAGERATIOSMAYBERELATEDTOFIRMSIZEWARNERANDANG,CHUA,ANDMCCONNELLPROVIDEEVIDENCETHATSUGGESTSTHATDIRECTBANKRUPTCYCOSTSAPPEARTOCONSTITUTEALARGERPROPORTIONOFAFIRMSVALUEASTHATVALUEDECREASESITISALSOTHECASETHATRELATIVELYLARGEFIRMSTENDTOBE

37、MOREDIVERSIFIEDANDLESSPRONETOBANKRUPTCYTHESEARGUMENTSSUGGESTTHATLARGEFIRMSSHOULDBEMOREHIGHLYLEVERAGEDTHECOSTOFISSUINGDEBTANDEQUITYSECURITIESISALSORELATEDTOFIRMSIZEINPARTICULAR,SMALLFIRMSPAYMUCHMORETHANLARGEFIRMSTOISSUENEWEQUITYSEESMITHANDALSOSOMEWHATMORETOISSUELONGTERMDEBTTHISSUGGESTSTHATSMALLFIRMSM

38、AYBEMORELEVERAGEDTHANLARGEFIRMSANDMAYPREFERTOBORROWSHORTTERMTHROUGHBANKLOANSRATHERTHANISSUELONGTERMDEBTBECAUSEOFTHELOWERFIXEDCOSTSASSOCIATEDWITHTHISALTERNATIVEWEUSETHENATURALLOGARITHMOFSALESLNSANDQUITRATESQRASINDICATORSOFSIZE5THELOGARITHMICTRANSFORMATIONOFSALESREFLECTSOURVIEWTHATASIZEEFFECT,IFITEXIS

39、TS,AFFECTSMAINLYTHEVERYSMALLFIRMSTHEINCLUSIONOFQUITRATES,ASANINDICATOROFSIZE,REFLECTSTHEPHENOMENONTHATLARGEFIRMS,WHICHOFTENOFFERWIDERCAREEROPPORTUNITIESTOTHEIREMPLOYEES,HAVELOWERQUITRATESGVOLATILITYMANYAUTHORSHAVEALSOSUGGESTEDTHATAFIRMSOPTIMALDEBTLEVELISADECREASINGFUNCTIONOFTHEVOLATILITYOFEARNINGWEW

40、EREONLYABLETOINCLUDEONEINDICATOROFVOLATILITYTHATCANNOTBEDIRECTLYAFFECTEDBYTHEFIRMSDEBTLEVELITISTHESTANDARDDEVIATIONOFTHEPERCENTAGECHANGEINOPERATINGINCOMESIGOISINCEITISTHEONLYINDICATOROFVOLATILITY,WEMUSTASSUMETHATITMEASURESTHISATTRIBUTEWITHOUTERRORHPROFITABILITYMYERSCITESEVIDENCEFROMDONALDSONANDBREAL

41、EYANDMYERSTHATSUGGESTSTHATFIRMSPREFERRAISINGCAPITAL,FIRSTFROMRETAINEDEARNINGS,SECONDFROMDEBT,ANDTHIRDFROMISSUINGNEWEQUITYHESUGGESTSTHATTHISBEHAVIORMAYBEDUETOTHECOSTSOFISSUINGNEWEQUITYTHESECANBETHECOSTSDISCUSSEDINMYERSANDMAJLUFTHATARISEBECAUSEOFASYMMETRICINFORMATION,ORTHEYCANBETRANSACTIONCOSTSINEITHE

42、RCASE,THEPASTPROFITABILITYOFAFIRM,ANDHENCETHEAMOUNTOFEARNINGSAVAILABLETOBERETAINED,SHOULDBEANIMPORTANTDETERMINANTOFITSCURRENTCAPITALSTRUCTUREWEUSETHERATIOSOFOPERATINGINCOMEOVERSALESOIISANDOPERATINGINCOMEOVERTOTALASSETSOIITAASINDICATORSOFPROFITABILITYMEASURESOFCAPITALSTRUCTURESIXMEASURESOFFINANCIALLE

43、VERAGEAREUSEDINTHISSTUDYTHEYARELONGTERM,SHORTTERM,ANDCONVERTIBLEDEBTDIVIDEDBYMARKETANDBYBOOKVALUESOFEQUITYALTHOUGHTHESEVARIABLESCOULDHAVEBEENCOMBINEDTOEXTRACTACOMMON“DEBTRATIO“ATTRIBUTE,WHICHCOULDINTURNBEREGRESSEDAGAINSTTHEINDEPENDENTATTRIBUTES,THEREISGOODREASONFORNOTDOINGTHISSOMEOFTHETHEORIESOFCAPI

44、TALSTRUCTUREHAVEDIFFERENTIMPLICATIONSFORTHEDIFFERENTTYPESOFDEBT,AND,FORTHEREASONSDISCUSSEDBELOW,THEPREDICTEDCOEFFICIENTSINTHESTRUCTURALMODELMAYDIFFERACCORDINGTOWHETHERDEBTRATIOSAREMEASUREDINTERMSOFBOOKORMARKETVALUESMOREOVER,MEASUREMENTERRORSINTHEDEPENDENTVARIABLESARESUBSUMEDINTHEDISTURBANCETERMANDDO

45、NOTBIASTHEREGRESSIONCOEFFICIENTSDATALIMITATIONSFORCEUSTOMEASUREDEBTINTERMSOFBOOKVALUESRATHERTHANMARKETVALUESITWOULD,PERHAPS,HAVEBEENBETTERIFMARKETVALUEDATAWEREAVAILABLEFORDEBTHOWEVER,BOWMANDEMONSTRATEDTHATTHECROSSSECTIONALCORRELATIONBETWEENTHEBOOKVALUEANDMARKETVALUEOFDEBTISVERYLARGE,SOTHEMISSPECIFIC

46、ATIONDUETOUSINGBOOKVALUEMEASURESISPROBABLYFAIRLYSMALLFURTHERMORE,WEHAVENOREASONTOSUSPECTTHATTHECROSSSECTIONALDIFFERENCESBETWEENMARKETVALUESANDBOOKVALUESOFDEBTSHOULDBECORRELATEDWITHANYOFTHEDETERMINANTSOFCAPITALSTRUCTURESUGGESTEDBYTHEORY,SONOOBVIOUSBIASWILLRESULTBECAUSEOFTHISMISSPECIFICATIONTHEREARE,H

47、OWEVER,SOMEOTHERIMPORTANTSOURCESOFSPURIOUSCORRELATIONTHEDEPENDENTVARIABLESUSEDINTHISSTUDYCANPOTENTIALLYBECORRELATEDWITHTHEEXPLANATORYVARIABLESEVENIFDEBTLEVELSARESETRANDOMLYCONSIDERFIRSTTHECASEWHEREMANAGERSSETTHEIRDEBTLEVELSACCORDINGTOSOMERANDOMLYSELECTEDTARGETRATIOMEASUREDATBOOKVALUETHISWOULDNOTBEIR

48、RATIONALIFCAPITALSTRUCTUREWEREINFACTIRRELEVANTIFMANAGERSSETDEBTLEVELSINTERMSOFBOOKVALUERATHERTHANMARKETVALUERATIOS,THENDIFFERENCESINMARKETVALUESACROSSFIRMSTHATARISEFORREASONSOTHERTHANDIFFERENCESINTHEIRBOOKVALUESSUCHASDIFFERENTGROWTHOPPORTUNITIESWILLNOTNECESSARILYAFFECTTHETOTALAMOUNTOFDEBTTHEYISSUESI

49、NCETHESEDIFFERENCESDO,OFCOURSE,AFFECTTHEMARKETVALUEOFTHEIREQUITY,THISWILLHAVETHEEFFECTOFCAUSINGFIRMSWITHHIGHERMARKETBOOKVALUERATIOSTOHAVELOWERDEBT/MARKETVALUERATIOSSINCEFIRMSWITHGROWTHOPPORTUNITIESANDRELATIVELYLOWAMOUNTSOFCOLLATERALIZABLEASSETSTENDTOHAVERELATIVELYHIGHMARKETVALUE/BOOKVALUERATIOS,ASPURIOUSRELATIONMIGHTEXISTBETWEENDEBTMARKETVALUEANDTHESEVARIABLES,CREATINGSTATISTICALLYSIGNIFICANTCOEFFICIENTESTIMATESEVENIFTHEBOOKVALUEDEBTRATIOSARESELECTEDRANDOMLYSIMILARSPURIOUSRELATIONSWILLBEINDUCEDBETWEENDEBTRATIOSMEASUREDATBOOKVALUEANDTHEEXPLANATORYVARIABLESIFFIRMSSELECTDEBTLEVELSI