Natural disasters and firm leasing: A collateral channel

Wang, Jiawei (Brooke)

Journal of Corporate Finance, 2023, vol. 82, issue C

Abstract: This paper studies the role of lease financing in disaster-affected firms under collateral constraints. Disaster-affected firms demand funds for post-disaster reconstruction. However, the destruction of natural disasters leads to collateral constraints, which create external financing frictions. I find that affected firms obtain financing through operating leases after natural disasters. The significance of the findings highlights the importance of operating leases for collateral-constrained firms.

Keywords: Natural disasters; Leasing; Collateral constraints; Financing frictions (search for similar items in EconPapers)
JEL-codes: G0 G32 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:82:y:2023:i:c:s0929119923000779

DOI: 10.1016/j.jcorpfin.2023.102428

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