Agency Theory and Capital Structure (PDF)

This special issue aimed at covering the general research topic of "e;Agency Theory and Capital Structure."e; The scope or range of research possibilities included the following specific topics. First, we were looking for theoretical works that addressed the interrelation between the resolution of agency conflicts and the choice of financing. Second, we asked for theoretical works that offered testable agency hypotheses in regards to the financing choice. Third, we wanted to attract experiential research that tested the effect of both agency costs and agency benefits related to capital structure theories. Fourth, we were looking for empirical research (including event period research) that investigated the market behavior surrounding security offerings with the emphasis on how an offering's agency effects influence a firm's capital structure. Fifth, we sought papers that represented a pedagogical emphasis providing students with an understanding of the how the financing choice impacts firm value through agency considerations. Sixth, we wanted innovative papers that embodied a practical application giving mangers insight into agency effects and the debt-to-equity choice. Seventh, we pursued papers that incorporated specific agency effects such as risk-shifting, overinvestment, underinvestment in a manager's capital structure decision-making. Eighth, we hoped to attract papers that could provide a detailed literature review related to the special issue topic of agency theory and capital structure. Finally, we were willing to consider any other paper that might fall within the general topical area of agency theory and capital structure.