Corporate Responses to Currency Depreciations: Evidence from Indonesia

Agustinus Prasetyantoko (prasetyantoko@gmail.com)

MPRA Paper from University Library of Munich, Germany

Abstract: This paper examines the impact of macro fluctuation on firm’s balance sheet to understand firm’s net worth as well as the corporate distress probability. We argue that debt policies could be pro-cyclical, since it enhances corporate distress risk when currency depreciation comes.

Keywords: currency depreciation; firm performance; debt ratio (search for similar items in EconPapers)
JEL-codes: D21 F34 G32 (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-rmg and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:6502

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