The Mystery of Zero-Leverage Firms

By Ilya A. Strebulaev, Baozhong Yang. 2013

522 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/ca861cab1792d18f0a0e21766ab35feb6792e90b

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Citations in the corpus

Investment and the Weighted Average Cost of Capital (2016, unknown): “Strebulaev and Yang (2013) define firms with a leverage ratio of 0.05 or less as being “almost zero leverage firms.””
Financing Frictions and the Substitution between Internal and External Funds (2010, unknown): “Recent work by Strebulaev and Yang (2007) shows that 0 (and near-0) leverage firms have markedly different behaviors from proxy firms when it comes to equity issuance (Table XI in their paper) and debt taking (Table XII).”
Leverage Dynamics without Commitment (2021, unknown): “The Zero-Leverage Puzzle Another significant empirical puzzle for the standard trade-off theory is that despite the tax benefits of debt, there exist a larger number of firms with zero leverage, as documented by Strebulaev and Yang (2013).”
Climate Risk and Capital Structure (2019, unknown): “…firms with higher Tobin’s Q values are less leveraged, which 19 For example, see Titman and Wessels (1988), Rajan and Zingales (1995), Graham, Lemmon, and Schallheim (1998), Hovakimian, Opler, and Titman (2001), and Strebulaev and Yang (2013). reflects their greater risk and potential for growth.”
From Finance to Marketing: The Impact of Financial Leverage on Customer Satisfaction (2015, background): “%) of large public nonfinancial U.S. firms have some amount of debt (Strebulaev and Yang 2013).”
Have Rating Agencies Become More Conservative? Implications for Capital Structure and Debt Pricing (2013, background): “Of course, our findings cannot explain the zero leverage puzzle (see, for example, Strebulaev and Yang (2013)), nor can they explain why firms had low leverage at the start of our sample period when rating agencies were not as strict compared to later years.”
The international zero-leverage phenomenon (2013, unknown): “Recent studies by Strebulaev and Yang (2006), Byoun et al. (2008), and Dang (2009) analyze zero-leverage firms, leaving extreme debt conservatism an unexplained mystery.”
The Role of Dynamic Renegotiation and Asymmetric Information in Financial Contracting (2015, unknown): “Fortunately, this condition represents the large majority of the population of publicly traded firms (Strebulaev and Yang, 2013).”
Institutional Determinants of Capital Structure Adjustment Speeds (2012, unknown): “Strebulaev and Yang (2007) find that zero leverage is a persistent behavior, and Hovakimian and Li (2011) suggest that dropping extreme leverage observations greater than 90% and less than 10% avoids spurious results.”