Optimal investment with fixed refinancing costs

Preprint OPEN
Jason G. Cummins; Ingmar Nyman;
(2001)
  • Subject: Corporations - Finance ; Financial institutions

Case studies show that corporate managers seek financial independence to avoid interference by outside financiers. We incorporate this financial xenophobia as a fixed cost in a simple dynamic model of financing and investment. To avoid refinancing in the future, the fir... View more
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