ABSTRACT

This paper examines how external governance pressure from the media affects capital structure. Using a comprehensive set of corporate news, we find a negative relation between media coverage and financial leverage. The tests we use to address endogeneity suggest that the effect is causal. Cross-sectional tests indicate that the results are more pronounced when board or shareholder monitoring is weaker. We further find that the effect of media coverage is more pronounced for news related to executives (i.e., the news that are more likely to impose reputational costs on managers). Our findings are consistent with a substitution effect between the external governance imposed by the media and the discipline provided by debt financing.

摘要

本文研究了来自媒体的外部治理压力如何影响资本结构。使用一组全面的企业新闻，我们发现媒体报道与财务杠杆之间存在负相关关系。我们用来解决内生性的测试表明，这种影响是因果关系。横截面测试表明，当董事会或股东监督较弱时，结果更为明显。我们进一步发现，媒体报道的影响对于与高管相关的新闻（即更有可能对经理造成声誉成本的新闻）更为显着。我们的研究结果与媒体强加的外部治理与债务融资提供的纪律之间的替代效应一致。