New insights on the importance of agency costs for corporate debt maturity decisions

Yilmaz Guney, Aydin Ozkan

Research output: Contribution to journalArticle

Abstract

This study provides new insights on the relationship between corporate debt maturity and agency costs by investigating empirically the impact of managerial ownership and the divergence between control and cash-flow rights on debt maturity. A significant negative effect of managerial ownership on debt maturity is observed. Moreover, the results reveal that the wedge between control and cash-flow rights also exerts a negative influence. The analysis further suggests that the negative effect of managerial ownership decreases in widely-held firms and increases with the discrepancy between control and cash-flow rights.
Original languageEnglish
Pages (from-to)233-238
Number of pages6
JournalApplied Financial Economics Letters
Volume1
Issue number4
DOIs
Publication statusPublished - 1 Jul 2005
Externally publishedYes

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