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- Title
The determinants of debt maturity in Australian firms.
- Authors
Alcock, Jamie; Finn, Frank; Tan, Kelvin Jui Keng
- Abstract
We examine the determinants of debt maturity in the Australian capital market with the Top 400 firms listed on the Australian Securities Exchange for the period 1989-2006. We find that Australian firms not only exhibit a positive leverage-maturity relationship but also use short-term debt to signal their high quality to the market. Our results are robust to different estimation methods that control for endogeneity and error-dependence. We also find that ignoring the interaction between leverage and maturity can lead to erroneous conclusions about the support for the matching principle, the agency costs hypothesis and the transaction costs hypothesis.
- Subjects
AUSTRALIA; STOCK exchanges; CAPITAL market; TRANSACTION costs; ESTIMATION theory; PUBLIC debts
- Publication
Accounting & Finance, 2012, Vol 52, Issue 2, p313
- ISSN
0810-5391
- Publication type
Article
- DOI
10.1111/j.1467-629X.2010.00397.x