TY - JOUR
T1 - How do industry tournament incentives affect firm debt maturity?
AU - Qi, Wanxia
AU - Jiraporn, Pornsit
AU - Liu, Yixin
N1 - Publisher Copyright:
© 2023 Elsevier B.V.
PY - 2024/1
Y1 - 2024/1
N2 - Our study investigates the effect of external industry tournament incentives on debt maturity structure. Prior research shows that industry tournament incentives motivate managers to employ more risky strategies. Recognizing this stronger tendency for risk-taking, creditors may shorten debt maturity and subject managers to more frequent scrutiny by debt markets. Consistent with this notion, our results show that stronger industry tournament incentives lead to significantly more short-term debt. This effect is more pronounced in firms with low credit quality, in areas with a high density of firms from the same industry, and in industries with more CEO positions.
AB - Our study investigates the effect of external industry tournament incentives on debt maturity structure. Prior research shows that industry tournament incentives motivate managers to employ more risky strategies. Recognizing this stronger tendency for risk-taking, creditors may shorten debt maturity and subject managers to more frequent scrutiny by debt markets. Consistent with this notion, our results show that stronger industry tournament incentives lead to significantly more short-term debt. This effect is more pronounced in firms with low credit quality, in areas with a high density of firms from the same industry, and in industries with more CEO positions.
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U2 - 10.1016/j.ribaf.2023.102081
DO - 10.1016/j.ribaf.2023.102081
M3 - Article
AN - SCOPUS:85171646552
SN - 0275-5319
VL - 67
JO - Research in International Business and Finance
JF - Research in International Business and Finance
M1 - 102081
ER -