Harbula, P. (2001) The Free Cash-Flow Theory versus Financial Constraints. Investments, Corporate Governance and Soft Budgeting Problems. Acta Oeconomica, 51 (4). pp. 489-512. ISSN 0001-6373
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Abstract
The supposed preference of firms for internal financial sources to fund their investments can be explained by either the free cash-flow or the financial constraints theories, both relying on asymmetric information. Neither theory was found fully valid by recent research. Using a French data panel, conclusive evidence will be made in favour of the free cash-flow theory in special cases. The validity of the free cash-flow theory in special cases will bring new issues to light with the introduction of a new definition: soft budgeting problem of capital. Through this analysis, the possible interaction between capital market imperfections and general equilibrium will also gain new dimension.
| Item Type: | Article |
|---|---|
| Subjects: | H Social Sciences / társadalomtudományok > H Social Sciences (General) / társadalomtudomány általában |
| Depositing User: | xKatalin xBarta |
| Date Deposited: | 06 Feb 2017 08:47 |
| Last Modified: | 31 Dec 2021 00:15 |
| URI: | http://real.mtak.hu/id/eprint/47197 |
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