https://www.nber.org/system/files/working_papers/w1396/w1396.pdf

Corporate financing and investment decisions when firms have information that investors do not have

This paper surveys research on corporate governance, with special attention to the importance of legal protection of investors and of ownership concentration in corporate governance systems around the world.

A Survey of Corporate Governance

https://uclafinance.typepad.com/main/files/myers_77.pdf

Determinants of corporate borrowing

This article surveys research on corporate governance, with special attention to the importance of legal protection of investors and of ownership concentration in corporate governance systems around the world. CORPORATE GOVERNANCE DEALS WITH the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment. How do the suppliers of finance get managers to return some of the profits to them? How do they make sure that managers do not steal the capital they supply or invest it in bad projects? How do suppliers of finance control managers? At first glance, it is not entirely obvious why the suppliers of capital get anything back. After all, they part with their money, and have little to contribute to the enterprise afterward. The professional managers or entrepreneurs who run the firms might as well abscond with the money. Although they sometimes do, usually they do not. Most advanced market economies have solved the problem of corporate governance at least reasonably well, in that they have assured the flows of enormous amounts of capital to firms, and actual repatriation of profits to the providers of finance. But this does not imply that they have solved the corporate governance problem perfectly, or that the corporate governance mechanisms cannot be improved. In fact, the subject of corporate governance is of enormous practical impor

/pdf/a-survey-of-corporate-governance-36f3yobhy4.pdf

Publisher Summary This chapter discusses the problem of selecting optimal security portfolios by risk-averse investors who have the alternative of investing in risk-free securities with a positive return or borrowing at the same rate of interest and who can sell short if they wish. It presents alternative and more transparent proofs under these more general market conditions for Tobin's important separation theorem that “ … the proportionate composition of the non-cash assets is independent of their aggregate share of the investment balance … and for risk avertere in purely competitive markets when utility functions are quadratic or rates of return are multivariate normal. The chapter focuses on the set of risk assets held in risk averters' portfolios. It discusses various significant equilibrium properties within the risk asset portfolio. The chapter considers a few implications of the results for the normative aspects of the capital budgeting decisions of a company whose stock is traded in the market. It explores the complications introduced by institutional limits on amounts that either individuals or corporations may borrow at given rates, by rising costs of borrowed funds, and certain other real world complications.

The valuation of risk assets and the selection of risky investments in stock portfolios and capital budgets

The Capital Structure Puzzle Author(s): Stewart C. Myers Source: The Journal of Finance, Vol. 39, No. 3, Papers and Proceedings, Forty-Second Annual Meeting, American Finance Association, San Francisco, CA, December 28-30, 1983 (Jul., 1984), pp. 575-592 Published by: Blackwell Publishing for the American Finance Association Stable URL: http://www.jstor.org/stable/2327916 Accessed: 29/10/2008 12:03

https://onlinelibrary.wiley.com/doi/pdf/10.1111/j.1540-6261.1984.tb03646.x

The Capital Structure Puzzle

This paper considers a firm that must issue common stock to raise cash to undertake a valuable investment opportunity. Management is assumed to know more about the firm's value than potential investors. Investors interpret the firm's actions rationally. An equilibrium model of the issue-invest decision is developed under these assumptions.The model shows that firms may refuse to issue stock, and therefore may pass up valuable investment opportunities.The model suggests explanations for several aspects of corporate financing behavior, including the tendency to rely on internal sources of funds, and to prefer debt to equity if external financing is required. Extensions and applications of the model are discussed.

https://papers.ssrn.com/sol3/Delivery.cfm/nber_w1396.pdf?abstractid=274547&rulid=5070249&mirid=4

Corporate Financing and Investment Decisions When Firms Have Informationthat Investors Do Not Have

https://pages.stern.nyu.edu/~eofek/PhD/papers/SM_Testing_JFE.pdf

Stewart C. Myers

Papers

Corporate financing and investment decisions when firms have information that investors do not have

Determinants of corporate borrowing

The Capital Structure Puzzle

Corporate Financing and Investment Decisions When Firms Have Informationthat Investors Do Not Have

Testing static tradeoff against pecking order models of capital structure