콘텐츠 바로가기
로그인
컨텐츠

Category Open

Resources

tutorial

Collection of research papers and materials on development issues

home

Resources
Economy Economic Administration
Economy Direct Investment

Print

Financial distress, liquidity policy, and financing policy : A comparison of Korea and the United States

Related Document
Frame of Image
  • Financial distress, liquidity policy, and financing policy
  • Lee, Hae Young; Fields, M. Andrew
  • Seoul National University


link
Title Financial distress, liquidity policy, and financing policy
Similar Titles
Sub Title

A comparison of Korea and the United States

Material Type Articles
Author(English)

Lee, Hae Young; Fields, M. Andrew

Publisher

[Seoul, S.Korea]:Seoul National University

Date 2003
Journal Title; Vol./Issue The Journal of Finance and Banking:vol. 2
Pages 19
Subject Country United States(Americas)
South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Economic Administration
Economy < Direct Investment
Holding Seoul National University

Abstract

This paper develops models for identifying the interrelationship between a firm's probability of financial distress and both its liquidity and financial policy decisions. And it empirically investigates the models using both Korea Stock Exchange firm panel data and those of a matched industry sample of Nasdaq firms from the United States. The results for both the Korean and the U.S. samples provide strong evidence that a higher level of liquidity and a lower level of debt are consistent with a firm having a lower probability of financial distress. Results also show that financial distress and financial policy are important determinants of a firm's liquidity policy. Finally, results show that there is a negative relationship between liquidity policy and debt financing, and a positive relationship between financial distress and the level of debt financing.