Corporate Postretirement Benefit Plans and Real Investment

Published Online:https://doi.org/10.1287/mnsc.2015.2307

References

  • Alderson M, Betker B (1996) Liquidation costs and accounting data. Financial Management 25:25–36.CrossrefGoogle Scholar
  • Almeida H, Campello M (2002) Financial constraints and investment-cash flow sensitivities: New research directions. Working paper, New York University, New York.Google Scholar
  • Almeida H, Campello M (2007) Financial constraints, asset tangibility, and corporate investment. Rev. Financial Stud. 20:1429–1460.CrossrefGoogle Scholar
  • Alti A (2003) How sensitive is investment to cash flow when financing is frictionless? J. Finance 58:707–722.CrossrefGoogle Scholar
  • Altman EI (2013) Predicting financial distress of companies: Revisiting the Z-score and ZETA® models. Bell AR, Brooks C, Prokopczuk M, eds. Handbook of Research Methods and Applications in Empirical Finance, Chap. 17 (Edward Elgar Publishing, Cheltenham, UK), 428–456.CrossrefGoogle Scholar
  • Anantharaman D, Fang VW, Gong G (2014) Inside debt and the design of corporate debt contracts. Management Sci. 60:1260–1280.LinkGoogle Scholar
  • Anderson TW (1951) Estimating linear restrictions on regression coefficients for multivariate normal distributions. Ann. Math. Statist. 22:327–351.CrossrefGoogle Scholar
  • Babenko I, Sen R (2014) Do non-executive employees have valuable information? Evidence from employee stock purchase plans. Working paper, Hong Kong University of Science and Technology, Kowloon.Google Scholar
  • Ballester M, Fried D, Livnat J (2002) Pension plan contributions, free cash flows and financial slack. Working paper, New York University, New York.Google Scholar
  • Bartram SM (2015) Corporate post-retirement benefit plans and leverage. Rev. Finance 20:575–629.CrossrefGoogle Scholar
  • Bekaert G, Harvey CR, Lundblad C (2005) Does financial liberalization spur growth? J. Financial Econom. 77:3–55.CrossrefGoogle Scholar
  • Berger AN, Udell GF (1990) Collateral, loan quality and bank risk. J. Monetary Econom. 25:21–42.CrossrefGoogle Scholar
  • Bernstein JI, Nadiri MI (1989) Rate of return on physical and R&D capital and structure of the production process: Cross section and time series evidence. Raj B, ed. Advances in Econometrics and Modelling (Kluwer Academic Publishing, Dordrecht, The Netherlands), 169–185.CrossrefGoogle Scholar
  • Bhattacharya S, Ritter JR (1983) Innovation and communication: Signaling with partial disclosure. Rev. Econom. Stud. 50:331–346.CrossrefGoogle Scholar
  • Bebchuck LA, Fried JM (2003) Executive compensation as an agency problem. J. Econom. Perspect. 17:71–92.CrossrefGoogle Scholar
  • Bebchuk LA, Jackson RJ Jr (2005) Executive pensions. J. Corporation Law 30:823–855.Google Scholar
  • Booth JR, Booth LC (2006) Loan collateral decisions and corporate borrowing costs. J. Money Credit Banking 38:67–90.CrossrefGoogle Scholar
  • Boyle GW, Guthrie GA (2003) Investment, uncertainty, and liquidity. J. Finance 58:2143–2166.CrossrefGoogle Scholar
  • Brown J, Peterson B (2011) Cash holdings and R&D smoothing. J. Corporate Finance 17:694–709.CrossrefGoogle Scholar
  • Brown JR, Fazzari SM, Peterson BC (2009) Financing innovation and growth: Cash flow, external equity, and the 1990s R&D boom. J. Finance 64:151–185.CrossrefGoogle Scholar
  • Bushee B (1998) The influence of institutional investors on myopic R&D investment behavior. Accounting Rev. 73:305–333.CrossrefGoogle Scholar
  • Butt Jaggia P, Thakor AV (1994) Firm-specific human capital and optimal capital structure. Internat. Econom. Rev. 35:283–308.CrossrefGoogle Scholar
  • Carpenter RE, Fazzari SM, Petersen BC (1994) Inventory investment, internal-finance fluctuations, and the business cycle. Brookings Papers Econom. Activity 2:75–138.CrossrefGoogle Scholar
  • Childs PD, Mauer DC, Ott SH (2005) Interactions of corporate financing and investment decisions: The effect of agency conflicts. J. Financial Econom. 76:667–690.CrossrefGoogle Scholar
  • Cleary S (1999) The relationship between firm investment and financial status. J. Finance 54:673–692.CrossrefGoogle Scholar
  • Cohen DA, Dey A, Lys TZ (2008) Real and accruals-based earnings management in the pre- and post-Sarbanes-Oxley periods. Accounting Rev. 83:757–787.CrossrefGoogle Scholar
  • Cohen DA, Mashruwala R, Zach T (2010) The use of advertising activities to meet earnings benchmarks: Evidence from monthly data. Rev. Accounting Stud. 15:808–832.CrossrefGoogle Scholar
  • Comprix J, Muller KA III (2011) Pension plan accounting estimates and the freezing of defined benefit pension plans. J. Accounting Econom. 51:115–133.CrossrefGoogle Scholar
  • Cooper RW, Haltiwanger JC (2006) On the nature of capital adjustment costs. Rev. Econom. Stud. 73:611–633.CrossrefGoogle Scholar
  • Cornell B, Shapiro AC (1988) Financing corporate growth. J. Appl. Corporate Finance 1:6–22.CrossrefGoogle Scholar
  • Dasgupta S, Sengupta K (2007) Corporate liquidity, investment and financial constraints: Implications from a multi-period model. J. Financial Intermediation 16:151–174.CrossrefGoogle Scholar
  • Dasgupta S, Lin Y, Yamada T, Zhang Z (2014) Employee inside debt and firm risk-taking: Evidence from employee deposit programs in Japan. Working paper, Hong Kong University of Science and Technology, Kowloon.Google Scholar
  • Deloitte (2007) A roadmap to the accounting and regulatory aspects of postretirement benefits. Report, Deloitte Development, Norwalk, CT.Google Scholar
  • Demirguc-Kunt A, Levine R (2001) Bank-based and market-based financial systems: Cross-country comparisons. Demirguc-Kunt A, Levine R, eds. Financial Structure and Economic Growth: A Cross-Country Comparison of Banks, Markets, and Development (MIT Press, Cambridge, MA).CrossrefGoogle Scholar
  • Denis DJ (2011) Financial flexibility and corporate liquidity. J. Corporate Finance 17:667–674.CrossrefGoogle Scholar
  • Edmans A, Liu Q (2011) Inside debt. Rev. Finance 15:75–102.CrossrefGoogle Scholar
  • Eldenburg LG, Gunny KA, Hee KW, Soderstrom N (2011) Earnings management using real activities: Evidence from nonprofit hospitals. Accounting Rev. 86:1605–1630.CrossrefGoogle Scholar
  • Fama EF (1990) Contract costs and financing decisions. J. Bus. 63:S71–S91.CrossrefGoogle Scholar
  • Fazzari SM, Petersen BC (1993) Working capital and fixed investment: New evidence on financing constraints. RAND J. Econom. 24:328–342.CrossrefGoogle Scholar
  • Fazzari S, Hubbard G, Petersen B (1988) Financing constraints and corporate investment. Brookings Papers Econom. Activity 1:141–195.CrossrefGoogle Scholar
  • Fazzari S, Hubbard G, Petersen B (2000) Investment-cash flow sensitivities are useful: A comment on Kaplan and Zingales. Quart. J. Econom. 115:695–705.CrossrefGoogle Scholar
  • Feldstein M, Mørck R (1983) Pension funding decisions, interest rate assumptions and share prices. Bodie Z, Shoven J, eds. Financial Aspects of the U.S. Pension System (University of Chicago Press, Chicago), 177–210.Google Scholar
  • Finnerty JE (1976) Insiders and market efficiency. J. Finance 31:1141–1148.CrossrefGoogle Scholar
  • Friedman BM (1983) Pension funding, pension asset allocation, and corporate finance: Evidence from individual company data. Bodie Z, Shoven J, eds. Financial Aspects of the U.S. Pension System (University of Chicago Press, Chicago),107–147.Google Scholar
  • Givoly D, Palmon D (1985) Insider trading and the exploitation of inside information: Some empirical evidence. J. Bus. 58:69–87.CrossrefGoogle Scholar
  • Goldstein RS, Ju N, Leland HE (2001) An EBIT-based model of dynamic capital structure. J. Bus. 74:483–512.CrossrefGoogle Scholar
  • Graham JR (2000) How big are the tax benefits of debt? J. Finance 55:1901–1941.CrossrefGoogle Scholar
  • Gustman AL, Mitchell OS, Steinmeier TL (1994) The role of pensions in the labor market: A survey of the literature. Indust. Labor Relations Rev. 47:417–438.CrossrefGoogle Scholar
  • Hackbarth D, Mauer DC (2012) Optimal priority structure, capital structure, and investment. Rev. Financial Stud. 25:747–796.CrossrefGoogle Scholar
  • Hadlock CJ, Pierce JR (2010) New evidence on measuring financial constraints: Moving beyond the KZ index. Rev. Financial Stud. 23:1909–1940.CrossrefGoogle Scholar
  • Hall BH (1992) Investment and research and development at the firm level: Does the source of financing matter? NBER Working Paper 4096, National Bureau of Economic Research, Cambridge, MA.CrossrefGoogle Scholar
  • Hall BH (2002) The financing of research and development. Oxford Rev. Econom. Policy 18:35–51.CrossrefGoogle Scholar
  • Hall BH, Lerner J (2010) The financing of R&D and innovation. Hall BH, Rosenberg N, eds. Handbook of the Economics of Innovation, Vol. 1 (Elsevier B.V., Amsterdam), 609–639.CrossrefGoogle Scholar
  • Hamermesh DS, Pfann GA (1996) Adjustment costs in factor demand. J. Econom. Literature 34:1264–1292.Google Scholar
  • Himmelberg CP, Petersen BC (1994) R&D and internal finance: A panel study of small firms in high-tech industries. Rev. Econom. Statist. 76:38–51.CrossrefGoogle Scholar
  • Huddart S, Lang M (2003) Information distribution within firms: Evidence from stock option exercises. J. Accounting Econom. 34:3–31.CrossrefGoogle Scholar
  • Ippolito RA (1985) The economic function of underfunded pension plans. J. Law Econom. 28:611–651.CrossrefGoogle Scholar
  • Kaplan S, Zingales L (1997) Do investment—Cash flow sensitivities provide useful measures of financing constraints? Quart. J. Econom. 112:169–215.CrossrefGoogle Scholar
  • Kaplan S, Zingales L (2000) Investment-cash flow sensitivities are not valid measures of financing constraints. Quart. J. Econom. 115:707–712.CrossrefGoogle Scholar
  • Kashyap A, Lamont OA, Stein JC (1994) Credit conditions and the cyclical behavior of inventories. Quart. J. Econom. 109:565–592.CrossrefGoogle Scholar
  • Lakonishok J, Lee I (2001) Are insider trades informative? Rev. Financial Stud. 14:79–111.CrossrefGoogle Scholar
  • Lamont O, Polk C, Saa-Requejo J (2001) Financial constraints and stock returns. Rev. Financial Stud. 14:529–554.CrossrefGoogle Scholar
  • Leland HE (1998) Agency costs, risk measurement, and capital structure. J. Finance 53:1213–1243.CrossrefGoogle Scholar
  • Leland HE, Pyle DH (1977) Informational asymmetries, financial structure, and financial intermediation. J. Finance 32:371–387.CrossrefGoogle Scholar
  • Li D (2011) Financial constraints, R&D investment, and stock returns. Rev. Financial Stud. 24:2974–3007.CrossrefGoogle Scholar
  • MacKay P (2003) Real flexibility and financial structure: An empirical analysis. Rev. Financial Stud. 16:1131–1165.CrossrefGoogle Scholar
  • Mauer DC, Triantis AJ (1994) Interactions of corporate financing and investment decisions: A dynamic framework. J. Finance 49:1253–1277.CrossrefGoogle Scholar
  • Mitchell O (1982) Fringe benefits and labor mobility. J. Human Resources 17:286–298.CrossrefGoogle Scholar
  • Modigliani F, Miller M (1958) The cost of capital, corporation finance and the theory of investment. Amer. Econom. Rev. 48:261–297.Google Scholar
  • Morellec E, Schürhoff N (2011) Corporate investment and financing under asymmetric information. J. Financial Econom. 99:262–288.CrossrefGoogle Scholar
  • Moyen N (2004) Investment–cash flow sensitivities: Constrained versus unconstrained firms. J. Finance 59:2061–2092.CrossrefGoogle Scholar
  • Myers SC, Majluf NS (1984) Corporate financing and investment decisions when firms have information that investors do not. J. Financial Econom. 13:187–221.CrossrefGoogle Scholar
  • Newey WK, West KD (1987) A simple, positive semi-definite, heteroskedasticity and autocorrelation consistent covariance matrix. Econometrica 55:703–708.CrossrefGoogle Scholar
  • Opler T, Titman S (1994) Financial distress and corporate performance. J. Finance 49:1015–1040.CrossrefGoogle Scholar
  • Petersen MA (1992) Pension reversions and worker-stockholder wealth transfers. Quart. J. Econom. 107(3):1033–1056.CrossrefGoogle Scholar
  • Petersen MA (2009) Estimating standard errors in finance panel data sets: Comparing approaches. Rev. Financial Stud. 22:435–480.CrossrefGoogle Scholar
  • Povel P, Raith M (2004) Financial constraints and product market competition: Ex ante vs. ex post incentives. Internat. J. Indust. Organ. 22:917–949.CrossrefGoogle Scholar
  • Purnanandam A, Rajan U (2013) Growth option exercise and capital structure. Working paper, University of Michigan, Ann Arbor.Google Scholar
  • Quinn DP, Toyoda AM (2008) Does capital account liberalization lead to growth? Rev. Financial Stud. 21:1403–1449.CrossrefGoogle Scholar
  • Rauh JD (2006) Investment and financing constraints: Evidence from the funding of corporate pension plans. J. Finance 61:33–71.CrossrefGoogle Scholar
  • Reuer JJ, Tong TW (2007) Corporate investments and growth options. Managerial Decision Econom. 28:863–877.CrossrefGoogle Scholar
  • Revsine L, Collins DW, Johnson WB (2005) Financial Reporting and Analysis, 3rd ed. (Pearson Prentice Hall, Upper Saddle River, NJ).Google Scholar
  • Rousseau PL, Wachtel P (2000) Equity markets and growth: Cross-country evidence on timing and outcomes, 1980–1995. J. Banking Finance 24:1933–1957.CrossrefGoogle Scholar
  • Roychowdhury S (2006) Earnings management through real activities manipulation. J. Accounting Econom. 42:335–370.CrossrefGoogle Scholar
  • Sargan J (1988) Testing for misspecification after estimation using instrumental variables. Maasoumi E, ed. Contributions to Econometrics: John Denis Sargan, Vol. 1 (Cambridge University Press, Cambridge, UK).Google Scholar
  • Schiller B, Weiss R (1980) Pension and wages: A test for equalizing differences. Rev. Econom. Statist. 63:529–538.CrossrefGoogle Scholar
  • Seyhun HN (1986) Insiders’ profits, costs of trading, and market efficiency. J. Financial Econom. 16:189–212.CrossrefGoogle Scholar
  • Seyhun HN (1992a) Why does aggregate insider trading predict future stock returns? Quart. J. Econom. 107:1303–1331.CrossrefGoogle Scholar
  • Seyhun HN (1992b) The effectiveness of the insider-trading sanctions. J. Law Econom. 35:149–182.CrossrefGoogle Scholar
  • Shivdasani A, Stefanescu I (2010) How do pensions affect corporate capital structure decisions? Rev. Financial Stud. 23:1287–1323.CrossrefGoogle Scholar
  • Standard & Poor’s (2006) Corporate ratings criteria. Report, Standard & Poor’s/McGraw-Hill, New York.Google Scholar
  • Stock JH, Yogo M (2005) Testing for weak instruments in linear IV regression. Andrews DWK, Stock JH, eds. Identification and Inference for Econometric Models: Essays in Honor of Thomas Rothenberg (Cambridge University Press, Cambridge, UK),80–108.CrossrefGoogle Scholar
  • Sundaram RK, Yermack DL (2007) Pay me later: Inside debt and its role in managerial compensation. J. Finance 62:1551–1588.CrossrefGoogle Scholar
  • Titman S, Tsyplakov S (2007) A dynamic model of optimal capital structure. Rev. Finance 11:401–451.CrossrefGoogle Scholar
  • Titman S, Wessels R (1988) The determinants of capital structure choice. J. Finance 43:1–19.CrossrefGoogle Scholar
  • Tsyplakov S (2008) Investment frictions and leverage dynamics. J. Financial Econom. 89:423–443.CrossrefGoogle Scholar
  • Van Bisbergen JH, Graham JR, Yang J (2011) Optimal capital structure. J. Appl. Corporate Finance 24:34–59.CrossrefGoogle Scholar
  • Wang C, Xie F, Xin X (2010) Managerial ownership of debt and bank loan contracting. Working paper, Chinese University of Hong Kong, Shatin.CrossrefGoogle Scholar
  • Wei C, Yermack D (2011) Investor reactions to CEOs’ inside debt incentives. Rev. Financial Stud. 24:3813–3840.CrossrefGoogle Scholar
  • Whited TM (2006) External finance constraints and the intertemporal pattern of intermittent investment. J. Financial Econom. 81:467–502.CrossrefGoogle Scholar
INFORMS site uses cookies to store information on your computer. Some are essential to make our site work; Others help us improve the user experience. By using this site, you consent to the placement of these cookies. Please read our Privacy Statement to learn more.