dc.contributor.authorBae, Kee-Hong
dc.contributor.authorKang, Jun-Koo
dc.contributor.authorWang, Jin
dc.identifier.citationBae, K. H., Kang, J. K., & Wang, J. (2011). Employee treatment and firm leverage: A test of the stakeholder theory of capital structure. Journal of Financial Economics, 100(1), 130-153.en_US
dc.description.abstractWe investigate the stakeholder theory of capital structure from the perspective of a firm’s relations with its employees. We find that firms that treat their employees fairly (as measured by high employee‐friendly ratings) maintain low debt ratios. This result is robust to a variety of model specifications and endogeneity issues. The negative relation between leverage and a firm’s ability to treat employees fairly is also evident when we measure its ability by whether it is included in the Fortune magazine list, “100 Best Companies to Work For.” These results suggest that a firm’s incentive or ability to offer fair employee treatment is an important determinant of its financing policy.en_US
dc.format.extent24 p.en_US
dc.relation.ispartofseriesJournal of financial economicsen_US
dc.rights© 2010 Elsevier B.V. This is the author created version of a work that has been peer reviewed and accepted for publication by Journal of Financial Economics, Elsevier B.V. It incorporates referee’s comments but changes resulting from the publishing process, such as copyediting, structural formatting, may not be reflected in this document. The published version is available at: [http://dx.doi.org/10.1016/j.jfineco.2010.10.019].en_US
dc.titleEmployee treatment and firm leverage : a test of the stakeholder theory of capital structureen_US
dc.typeJournal Article
dc.contributor.schoolCollege of Business (Nanyang Business School)en_US
dc.description.versionAccepted versionen_US

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