Loading...
Please wait, while we are loading the content...
Similar Documents
The Relative Influence of Competitive Intensity and Business Strategy on the Relationship between Financial Leverage and Performance
| Content Provider | Semantic Scholar |
|---|---|
| Author | Jermias, Johnny |
| Copyright Year | 2008 |
| Abstract | This study empirically investigates the effects of competitive intensity and business strategy on the relationship between financial leverage and the performance of firms. Based on a sample of US manufacturing firms, this study confirms the hypothesis that the cost of debt is higher for product differentiation firms than cost leadership firms. Furthermore, the results indicate that competitive intensity has a negative effect on the leverage-performance relationship, suggesting that competition acts as a substitute for debt in limiting managers' opportunistic behavior. These findings reinforce the need to consider the moderating factors such as strategic choice and the environment in which a firm operates when investigating the effects of leverage on performance. |
| Starting Page | 71 |
| Ending Page | 86 |
| Page Count | 16 |
| File Format | PDF HTM / HTML |
| DOI | 10.1016/j.bar.2007.11.001 |
| Volume Number | 40 |
| Alternate Webpage(s) | http://isiarticles.com/bundles/Article/pre/pdf/12504.pdf |
| Alternate Webpage(s) | https://doi.org/10.1016/j.bar.2007.11.001 |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
