How Can We Improve Inferences from Surveys? A New Look at the Convertible Debt Questions from the Graham and Harvey Survey Data

29 Pages Posted: 31 Jul 2017 Last revised: 15 Jul 2018

See all articles by Ming Dong

Ming Dong

York University - Schulich School of Business

Marie Dutordoir

University of Manchester - Manchester Business School

Chris Veld

Monash University

Date Written: July 2, 2018

Abstract

We revisit the survey questions on convertible bond issue motives from the influential study of Graham and Harvey (Journal of Financial Economics, 2001). Our question-conditional analysis connecting survey answers with firm characteristics reveals that the conclusions on two of the four convertible debt theories from the original study need to be revised. More particularly, the delayed equity rationale and the sequential financing rationale on convertible bond issuance do not receive support from the question-conditional tests. Our results indicate that adding a question-conditional analysis is essential in obtaining correct inferences from survey data.

Suggested Citation

Dong, Ming and Dutordoir, Marie and Veld, Chris, How Can We Improve Inferences from Surveys? A New Look at the Convertible Debt Questions from the Graham and Harvey Survey Data (July 2, 2018). Available at SSRN: https://ssrn.com/abstract=3009818 or http://dx.doi.org/10.2139/ssrn.3009818

Ming Dong (Contact Author)

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada
416-736-2100 ext. 77945 (Phone)
416-736-5687 (Fax)

Marie Dutordoir

University of Manchester - Manchester Business School ( email )

Booth Street West
Manchester, M15 6PB
United Kingdom

Chris Veld

Monash University ( email )

Building 11E
Clayton, Victoria 3800
Australia

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