Financial Pressure and Balance Sheet Adjustment by UK Firms

Andrew Benito and Garry Young
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Andrew Benito: Bank of England

No 20, Royal Economic Society Annual Conference 2002 from Royal Economic Society

Abstract: This paper examines the financial policies and balance sheet adjustment of companies. Using a large panel of UK firms, we estimate models for dividends, new equity issuance and investment, relating them to debt adjustment. The results suggest that while dividends are sticky in the short run, they are an important means of balance sheet adjustment in the long run. Other evidence supports the idea that companies actively target their balance sheet by variation in dividends, new equity issues and investment.

Date: 2002-08-29
New Economics Papers: this item is included in nep-fin
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Related works:
Journal Article: Financial Pressure and Balance Sheet Adjustment by Firms* (2007)
Working Paper: Financial Pressure and Balance Sheet Adjustment by UK Firms (2002)
Working Paper: Financial pressure and balance sheet adjustment by UK firms (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:ecj:ac2002:20

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