Capital Structure and the Cost of Capital
19 Pages Posted: 4 Aug 2005
This article provides an intertemporal synthesis of the basic neoclassical theory of capital structure as a tradeoff between tax effects and bankruptcy costs. The latter is partially endogenized as the loss of future tax benefits and the stationary reorganization policy is considered.
JEL Classification: G300, G310, G320
Suggested Citation: Suggested Citation