skip to primary navigationskip to content
 

REF doctoral seminar

When Feb 25, 2011
from 03:00 PM to 04:00 PM
Where Laundress Lane, Seminar Room 1
Contact Name
Add event to calendar vCal
iCal

Gabor Pinter (Department of Land Economy) presenting.

TitleCapital Structure and Investment Dynamics

Abstract: This paper studies how investment dynamics is affected by firms' decision to lease as opposed to buy productive capital. To understand the role of leasing, a dynamic model of investment with financial frictions such credit and irreversibility constraints will be developed. Firms adjust their capital stock in response to shocks to profitability. Financial frictions hinder the efficiency to sell/buy capital, whereas lessors serve as trading intermediaries to mitigate these frictions. The intuition behind why leasing is beneficial is twofold. Firstly, repossession of leased capital is easier than foreclosure on the collateral of a secured loan. Secondly, leased capital (unlike purchased capital) is not subject to irreversibility constraints, which makes capital adjustments easier in face of shocks. The paper provides empirical evidence on firm-level data for selected EU countries in order to test the theoretical predictions of the model.

The format is 30 minutes presentation, 10 minutes discussant, 20 minutes general questions and debate. We hope to continue the discussion informally after the seminar

« February 2019 »
February
MoTuWeThFrSaSu
123
45678910
11121314151617
18192021222324
25262728

RSS Feed Latest news

Winners of the Best Student Paper Award 2018 announced

Aug 21, 2018

Cambridge Finance is proud to announce the winners of the Best student Paper Award for 2017-2018

View all news

Upcoming events

Cambridge Finance Workshop - Yuri Tserlukevich

Mar 07, 2019

Castle Teaching Room, Cambridge Judge Business School

Previous events

Upcoming events