Abstract

http://ssrn.com/abstract=1923467
 
 

Citations (5)



 
 

Footnotes (13)



 


 



Redefining Financial Constraints: A Text-Based Analysis


Gerard Hoberg


University of Maryland - Department of Finance

Vojislav Maksimovic


University of Maryland - Robert H. Smith School of Business

August 16, 2013


Abstract:     
We score 10-K text to obtain annual measures of financial constraints, with separate measures for firms assessing equity and debt issues. Equity market constraints have more severe consequences for the firm, relate to firms funding growth opportunities, and are likely driven by informational asymmetries. We find a significant population of firms that report equity market constraints and declare proprietary information risks. Constraints in the debt markets are distinct, relate to firms funding capital expenditures, and are likely driven by factors relating to debt overhang. Our measures outperform others used in the literature in predicting investment cuts following exogenous shocks.

Number of Pages in PDF File: 62

Keywords: Financial Constraints, Research and Development, Equity Issuance, Asymmetric Information, Debt Overhang, Debt Issuance, Text-Based Analysis

JEL Classification: G31, G32, D92

working papers series


Download This Paper

Date posted: September 8, 2011 ; Last revised: August 16, 2013

Suggested Citation

Hoberg, Gerard and Maksimovic, Vojislav, Redefining Financial Constraints: A Text-Based Analysis (August 16, 2013). Available at SSRN: http://ssrn.com/abstract=1923467 or http://dx.doi.org/10.2139/ssrn.1923467

Contact Information

Gerard Hoberg (Contact Author)
University of Maryland - Department of Finance ( email )
Robert H. Smith School of Business
Van Munching Hall
College Park, MD 20742
United States
HOME PAGE: http://www.rhsmith.umd.edu/finance/faculty/hoberg.aspx
Vojislav Maksimovic
University of Maryland - Robert H. Smith School of Business ( email )
Van Munching Hall
College Park, MD 20742-1815
United States
301-405-2125 (Phone)
301-314-9157 (Fax)
HOME PAGE: http://www.rhsmith.umd.edu/finance/vmax/
Feedback to SSRN


Paper statistics
Abstract Views: 1,224
Downloads: 294
Download Rank: 56,107
Citations:  5
Footnotes:  13

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo7 in 0.391 seconds