根深蒂固的管理，改变了的资本结构和企业价值外文翻译.docVIP

外文翻译 原文 Entrenched management, capital structure changes and firm value Material Source: /content/ e143697042062757/ Author:Leonard L. Lundstrum The relationship between managerial share ownership and the firm’s change in leverage around a security issuance is examined. We find that entrenched managers are not more likely to issue equity, however they do affect lower leverage by choosing debt issuances which are smaller and equity issuances that are larger than those chosen by managers that are not entrenched. The magnitude of the decline in leverage that occurs from before the issuance to after the issuance is positively related to managerial share ownership. In addition, this relationship is confined to only the “entrenchment” range of managerial share ownership. The market reacts negatively to an issuance announcement when managerial share ownership is high. 1 Introduction A number of investigators, including Berger et al. (1997) and Garvey and Hanka(1999) report that managerial entrenchment affects the firm’s choice of leverage.Theory implies that debt constrains management discretion by either reducing the manager’s bargaining power (Noe and Rebello 1996) or by reducing discretion over spending (Stulz 1990). Zwiebel (1996) argues that entrenched managers use their influence to lower debt levels to the point that capital structure maximizes empire building subject to sufficient efficiency to prevent a takeover. Agency costs will be incurred at the time of security issuance if the manager makes a sub-optimal security issuance choice. Jensen and Meckling (1976) find that agency costs are decreasing in managerial share ownership. Yet Stulz (1988) argues that agency costs are not necessarily monotonically decreasing in managerial share ownership as there exists an “entrenchment” range over which the managers ability to deter takeovers dominates the “incentive” effect of managerial share ownership. We examine the relation between managerial share ownership and t