I hypothesize and find that the variation in corporate tax avoidance is jointly determined by firms’ incentive and opportunities to avoid taxes. Specifically, the positive relation between financial constraints (my proxy for an incentive to avoid taxes) and tax avoidance is significantly stronger for firms with high tax planning opportunities (TPO), where TPO is the distance between a firm’s actual and predicted ETRs. I further show that firms with TPOs based on high permanent (temporary) book-tax differences exhibit more permanent (temporary) book-tax differences under financial constraints. From a risk perspective, I find no evidence that financially constrained firms with low TPO exhibit more tax risk but some evidence that those with high TPO do so. In general, the findings in this paper provide evidence consistent with an incentive-opportunity interaction story to help explain differences in corporate tax avoidance.

This study investigates the effect of the European sovereign debt crisis on alternative capital sources of public companies from France, Germany, Switzerland and the United Kingdom. Specifically, it studies which financing choices expose a company to potential bank lending and demand shocks during the Euro crisis. To this end, the study employs average treatment effect estimations and difference-in-differences regressions to show whether financially more (less) constrained companies use more (less) alternative capital than matching control companies. I find that two of three financially more constrained company groups show higher use of alternative capital sources than matched companies due to evidence for bank lending shocks in Germany and France. Companies with a high financial dependence behave against the expectation because of high cash holdings and lower need for alternative capital. Companies with high cash holdings showed signs of a demand shock. Swiss and British companies appear to be much less affected by the Euro crisis because of weaker financial ties with the most affected southern Eurozone economies.

The aim of this study is to investigate the influence of state ownership in Saudi firms listed in the stock market. The first chapter studies the influence of state ownership on financial constraint on investment. Some scholars believe state ownership has a negative effect on the firm value. However, by using two measures of financial constraint, the investment cash flow sensitivity and the Kaplan and Zingales financial constraints index, the finding indicates that the existent of government ownership decreases financial constraint in firms. Also, the results show that the higher government ownership percentage the less financial constraint in firms. The second chapter studies the influence of specific company factors and the government ownership factor on capital structure. The finding shows that tangibility of assets and size have a positive association with leverage. Leverage is negatively correlated with growth and profitably. Finally, the results suggest that government ownership affects the level of leverage negatively.

Este estudo teve como objetivo identificar alguns fatores que determinam a manutenção de determinados níveis de caixa nas organizações. Além disso, buscou-se identificar se existe diferença nas políticas de retenção de caixa entre os grupos de empresas restritas e não restritas financeiramente. Por fim, procurou-se verificar se houve mudanças nessa política em períodos considerados de maior volatilidade dos negócios. Para isso, forma analisadas as empresas não financeiras, cujos dados estavam disponíveis no banco de dados Economática durante o período entre 1998 e 2011. Os resultados indicam que há relação entre a incerteza na geração de caixa e a retenção de caixa, principalmente para empresas classificadas como restritas financeiramente. O risco país também apresentou forte relação com o nível de caixa das empresas. Confirmou-se a relação esperada entre Tamanho e Nível de Caixa suportada pela Pecking Order Theory; a relação entre Oportunidades de Investimento e Nível de Caixa esperada tanto pela Static Tradeoff Theory, quanto pela Pecking Order Theory; a relação entre Endividamento e Nível de Caixa explicada pela Static Tradeoff Theory; e a relação entre Investimento Operacional em Giro e o Nível de Caixa esperado pela Free Cash Flow Theory. Dentre as dummies utilizadas para capturar os eventos de maior volatilidade, apenas a relativa a crise cambial durante o processo eleitoral do presidente Lula apresentou resultados significativos. / This study aim to identify factors that explain why firms retain cash. In addition, we observe the impact of firms financial constraints in the cash holdings policy. At last, we try to investigate if more volatile periods affect the firms cash holdings. In order to do that, we analize non-financial firms with data from Economatica during the period between 1998 and 2011. The results show us that there is a relation between the uncertainty of cash flow generation and the cash holdings, specialy for firms with financial constraints. The country risk has relation with the cash holdings too. We found evidence to support the relation expect between Size and Cash supported by Pecking Order Theory; the relation between Investment Oportunities and Cash by the Static Tradeoff Theory and Pecking Order Theory; the relation between Leverage and Cash by the Static Tradeoff Theory; and the relation between Net Working Capital and Cash by the Free Cash Flow Theory. Just the dummy that try to captures the Exchange rate crises on the electoral period of presidente Lula has significant impact.

Este estudo teve como objetivo identificar alguns fatores que determinam a manutenção de determinados níveis de caixa nas organizações. Além disso, buscou-se identificar se existe diferença nas políticas de retenção de caixa entre os grupos de empresas restritas e não restritas financeiramente. Por fim, procurou-se verificar se houve mudanças nessa política em períodos considerados de maior volatilidade dos negócios. Para isso, forma analisadas as empresas não financeiras, cujos dados estavam disponíveis no banco de dados Economática durante o período entre 1998 e 2011. Os resultados indicam que há relação entre a incerteza na geração de caixa e a retenção de caixa, principalmente para empresas classificadas como restritas financeiramente. O risco país também apresentou forte relação com o nível de caixa das empresas. Confirmou-se a relação esperada entre Tamanho e Nível de Caixa suportada pela Pecking Order Theory; a relação entre Oportunidades de Investimento e Nível de Caixa esperada tanto pela Static Tradeoff Theory, quanto pela Pecking Order Theory; a relação entre Endividamento e Nível de Caixa explicada pela Static Tradeoff Theory; e a relação entre Investimento Operacional em Giro e o Nível de Caixa esperado pela Free Cash Flow Theory. Dentre as dummies utilizadas para capturar os eventos de maior volatilidade, apenas a relativa a crise cambial durante o processo eleitoral do presidente Lula apresentou resultados significativos. / This study aim to identify factors that explain why firms retain cash. In addition, we observe the impact of firms financial constraints in the cash holdings policy. At last, we try to investigate if more volatile periods affect the firms cash holdings. In order to do that, we analize non-financial firms with data from Economatica during the period between 1998 and 2011. The results show us that there is a relation between the uncertainty of cash flow generation and the cash holdings, specialy for firms with financial constraints. The country risk has relation with the cash holdings too. We found evidence to support the relation expect between Size and Cash supported by Pecking Order Theory; the relation between Investment Oportunities and Cash by the Static Tradeoff Theory and Pecking Order Theory; the relation between Leverage and Cash by the Static Tradeoff Theory; and the relation between Net Working Capital and Cash by the Free Cash Flow Theory. Just the dummy that try to captures the Exchange rate crises on the electoral period of presidente Lula has significant impact.

Este estudo teve como objetivo identificar alguns fatores que determinam a manutenção de determinados níveis de caixa nas organizações. Além disso, buscou-se identificar se existe diferença nas políticas de retenção de caixa entre os grupos de empresas restritas e não restritas financeiramente. Por fim, procurou-se verificar se houve mudanças nessa política em períodos considerados de maior volatilidade dos negócios. Para isso, forma analisadas as empresas não financeiras, cujos dados estavam disponíveis no banco de dados Economática durante o período entre 1998 e 2011. Os resultados indicam que há relação entre a incerteza na geração de caixa e a retenção de caixa, principalmente para empresas classificadas como restritas financeiramente. O risco país também apresentou forte relação com o nível de caixa das empresas. Confirmou-se a relação esperada entre Tamanho e Nível de Caixa suportada pela Pecking Order Theory; a relação entre Oportunidades de Investimento e Nível de Caixa esperada tanto pela Static Tradeoff Theory, quanto pela Pecking Order Theory; a relação entre Endividamento e Nível de Caixa explicada pela Static Tradeoff Theory; e a relação entre Investimento Operacional em Giro e o Nível de Caixa esperado pela Free Cash Flow Theory. Dentre as dummies utilizadas para capturar os eventos de maior volatilidade, apenas a relativa a crise cambial durante o processo eleitoral do presidente Lula apresentou resultados significativos. / This study aim to identify factors that explain why firms retain cash. In addition, we observe the impact of firms financial constraints in the cash holdings policy. At last, we try to investigate if more volatile periods affect the firms cash holdings. In order to do that, we analize non-financial firms with data from Economatica during the period between 1998 and 2011. The results show us that there is a relation between the uncertainty of cash flow generation and the cash holdings, specialy for firms with financial constraints. The country risk has relation with the cash holdings too. We found evidence to support the relation expect between Size and Cash supported by Pecking Order Theory; the relation between Investment Oportunities and Cash by the Static Tradeoff Theory and Pecking Order Theory; the relation between Leverage and Cash by the Static Tradeoff Theory; and the relation between Net Working Capital and Cash by the Free Cash Flow Theory. Just the dummy that try to captures the Exchange rate crises on the electoral period of presidente Lula has significant impact.

The current qualitative research was aimed at exploring and describing symbolic consumption and extension of self through possessions during liminality of full-time MBA students, moderated by financial constraint. The main purpose of the study was to gain deeper understanding of the liminal stage of full-time MBA students as consumers, and its effect on the symbolic consumption in the context of restricted financial resources. The main purpose of the research determined its exploratory and inductive nature within the interpretivist philosophy to qualitative inquiry. Twelve semi-structured interviews were conducted with participants chosen according to the pre-set criteria. Raw data was analysed using constant comparative and content analyses. The main findings of the research showed that during MBA studies as a period of liminality, participants faced the necessity to re-adjust their consumption behaviour in order to fulfil the shifts to new social roles and therefore construct new identities. Being financially constrained, they had to make trade-offs defined by main priorities of this stage in life. As a result, participants re-evaluated their previous consumption behaviour, and adopted a new one appropriate for their new social roles and gained new decisionmaking skills. Through financial constraint as an important moderating variable of the experience, participants gained new understanding of power and value of money which formed their consumption going forward. The outcome of the research contributed to the existing body of knowledge on changes in consumption behaviour of individuals in life transitions, including symbolic consumption and self-extension through possessions. In addition to that, insights gained during research contributed to the understanding of the role financial constraint plays as a moderating variable for consumption in transition. Therefore, the results of the research are of practical value for marketers as they provide valuable insights that can be used for more efficient targeting of appropriate buyer groups. / Mini Dissertation (MBA)--University of Pretoria, 2018. / Gordon Institute of Business Science (GIBS) / MBA / Unrestricted

This dissertation consists of 2 essays in the area of corporate finance. The title of my first essay is “Impact of Institutional Investors on Firms’ Financial Constraint and Liquidity”. We can find ample evidences in existing literature which show that institutional investors play a vital role in the corporate world. Many researchers have linked institutional investors to activism, monitoring benefits, mitigating the cost of debt using government bond, spin off activities and improving information asymmetry problem. In the first essay, I would like to add another dimension to institutional investors’ literature by examining institutional investors’ role in mitigating financial constraint problem in the firm. Institutional investors have large financial networks and make large financial investment in firms. Their presence might help firms attract external capital. I am using 2 financial constraint measurements; KZ index (Lamont, Polk, Saa-Requejo, 2001) and bank line of credit (Sufi, 2009). I am also adding additional measurement for financial constraint using notes payable. I find evidences to support the hypotheses that institutional investors’ presence and ownership mitigate financial constraints. The title of my second essay is “Long- and Short-Term Institutional Investors and Payout Policy”. In the second essay, I examine the relationship between the firms’ payout policy and the presence/ownership of certain type of institutional investors. I classify the types of institutional investors using Bushee’s (1998, 2001) classification of institutional investors. I find that the presence and the magnitude of long term institutional investors positively affect the likelihood and the magnitude of dividend. I also find that the presence and the magnitude of short term institutional investors positively affect the likelihood and the magnitude of share repurchases. This study suggests that the presence of different types of institutional investors can affect certain type of payout policy. Keywords: Transient; dedicated; monitoring; trading

Este estudo tem por objetivo verificar como a reputação afeta as decisões de investimento das firmas. Já existe um consenso na literatura de que uma boa reputação contribui para o desempenho da firma, mas ainda são poucos e recentes os estudos que verificam as relações entre reputação corporativa e decisões de investimento. Portanto, deseja-se verificar se a reputação afeta a probabilidade de uma empresa ser classificada como subinvestimento, investimento eficiente ou sobreinvestimento; e também qual é o impacto da reputação na taxa de crescimento do investimento de uma firma. Para isso utiliza-se uma base de dados longitudinais de 180 firmas espanholas entre 2000 e 2015. A mensuração para reputação corporativa é feita através da classificação no ranking de reputação Merco, que divulga anualmente uma lista com as cem empresas espanholas com melhor reputação naquele ano. Os dados financeiros e de estrutura de propriedade são obtidos através do sistema SABI. Inicialmente, o modelo tem como variável dependente uma binária que representa se a empresa pertence ou não a determinado nível de investimento. Neste caso, regressões logísticas são utilizadas para determinar como a reputação afeta a probabilidade da empresa ser classificada por apresentar subinvestimento, investimento ótimo ou sobreinvestimento. Em seguida, a variável dependente é a taxa de investimento da firma, portanto, o método GMM-sys é aplicado para controlar a endogeneidade provocada pela inclusão da variável dependente defasada no modelo. Também são estimados modelos considerando a restrição financeira da firma, seu tamanho e sua estrutura de propriedade. Os resultados mostram que a reputação interfere de maneira positiva na taxa de investimento das firmas espanholas. Além disso, quando a empresa tem melhor reputação, sua dependência de caixa para fazer investimentos também aumenta. Contudo, a reputação não é significativa para aumentar a probabilidade de uma empresa apresentar investimento eficiente, nem para explicar o investimento das firmas consideradas restritas financeiramente. / The objective of this research is to verify how reputation affects investment decisions. There is already a consensus in the literature that a good reputation contributes to firm performance; however, there are few recent studies that examine the relationship between corporate reputation and investment decisions. Therefore, our desire is to verify whether reputation affects the probability of a company being classified as underinvestment, efficient investment or overinvestment; also, we attempt to analyze the impact of reputation on the growth rate of a firm\'s investment. A longitudinal database of 180 Spanish firms between the period of 2000 and 2015 is used. The measurement for corporate reputation is done by ranking in the Merco reputation ranking, which annually publishes a list of the 100 most reputable Spanish companies in that year. The financial and ownership structure data are obtained through the SABI system. Initially the model has as dependent variable which is a binary that represents whether the company belongs or not to a certain level of investment. In this case, logistic regressions are used to determine how the reputation affects the probability of the company being classified as having underinvestment, optimal investment or overinvestment. Later, the dependent variable is represented by the investment rate of the firm, so the GMM-sys method is applied to control the endogeneity caused by the inclusion of the lagged dependent variable in the model. Models are also estimated considering the firm\'s financial constraint, its size and its ownership structure. The results show that reputation interferes in a positive way in the investment rate of Spanish firms. In addition, when the company has a better reputation, its dependence on cash to make investments also increases. However, reputation is significant in increasing the likelihood that a firm will be able to make an efficient investment, or to explain the investment of firms that are considered financially constrained.

Este estudo analisa os efeitos do sistema financeiro, caracterizado tanto em termos de desenvolvimento financeiro quanto por sua estrutura financeira, sobre as decisões de investimento e restrições financeiras de firmas brasileiras. Dessa forma, este trabalho investiga como o desenvolvimento financeiro afeta o comportamento das firmas e que tipo de estrutura financeira, isto é, se market-based ou bank-based, prepondera na condução do investimento corporativo e na redução das restrições financeiras das firmas. A relevância deste estudo reside em seu caráter original conduzido a partir da análise de um tema ainda pouco explorado na literatura nacional. A investigação é realizada dentro de um contexto teórico e aplicado e assumindo que o sistema financeiro exerce impacto substancial sobre as decisões de investimento. Com o propósito de contribuir para a escassa literatura internacional e à exígua literatura para o Brasil são consideradas neste estudo informações de 404 firmas brasileiras para o período de 1998 a 2006. A fim de identificar a presença de restrição financeira no comportamento da firma e para controlar e separar seus efeitos de outros fatores nas decisões de investimento, as firmas da amostra são classificadas segundo os índices de restrição financeira KZ e WW. A partir do emprego de dados macroeconômicos em uma análise microeconômica, é estimada uma versão do modelo acelerador do investimento pelo método GMM-system para analisar os efeitos do sistema financeiro sobre os investimentos corporativos. Os resultados sugerem que para firmas financeiramente não restritas o impacto do desenvolvimento financeiro sobre as decisões corporativas ocorre de forma direta, conduzindo a maiores investimentos. Já para firmas financeiramente restritas este efeito ocorre de forma indireta. Nesse caso, um maior desenvolvimento financeiro reduz a dependência dessas firmas por recursos internos para investir e aumenta a resposta de seus investimentos às oportunidades de crescimento. Evidências também são encontradas de que a estrutura financeira exerce influência sobre os investimentos de firmas financeiramente restritas, mesmo após os resultados serem controlados pelo nível de desenvolvimento financeiro. Este resultado aponta para a relevância de um sistema financeiro baseado em mercados para atenuar as restrições financeiras de firmas restritas. Os resultados também sugerem que na presença de oportunidades de crescimento um sistema financeiro baseado em mercados destaca-se ao permitir que a resposta do investimento das firmas a um aumento da demanda seja maior que em um sistema baseado em bancos. / This study analyzes the effects of the financial system, characterized both in terms of financial development as also by its financial structure, on the investment decisions and financial constraints of Brazilian firms. Thereby, this work investigates how the financial development affects a firm\'s behavior and which kind of financial structure, that is, if market-based or bank-based, prevails in driving corporate investment and in reducing a firms\' financial constraints. The relevance of this study lies on its original feature carried from the analysis of a topic not much explored in the national literature. The research is conducted within a theoretical and applied context and by assuming that the financial system exerts substantial impact on investment decisions. In order to contribute to the scarce international literature and to the limited literature for Brazil this study considers information on 404 Brazilian firms over the 1998-2006 period. With the aim to identify the presence of financial constraint on firm behavior and control and separate its effects from other factors on investment decisions, the firms are classified according to the KZ and WW financial constraint indexes. Through the use of macroeconomic data in a microeconomic analysis, a version of the accelerator investment model is estimated by the GMM-system method to analyze the effects of the financial system on corporate investments. The results suggest that for financially unconstrained firms the impact of financial development on corporate decisions is direct, leading to higher investments. On the other hand, for financially constrained firms this effect occurs in an indirect way. In this case, a higher financial development reduces the investment dependence of these firms on internal resources and increases the response of investment to growth opportunities. Evidence is also found that the financial structure affects the investment of financially constrained firms, even after the results are controlled for the level of financial development. This result points to the relevance of a market-based financial system for mitigating the constrained firms\' financial constraints. Results also suggest that in the presence of growth opportunities the response of a firm\'s investment to the increased demand is higher in a market-based financial system than in a bank-based one.