We study the effect of entrepreneurs’ wealth allocations on their firm level capital structure by using a sample of small privately owned firms from the 2003 Surveys of Small Business Finance. We find that financial leverage decreases as entrepreneurs allocate more wealth on their firm investments. We also find that wealth allocation only affects capital structure in limited liability firms. Lastly, we show that the effect of wealth allocation on capital structure does not disappear after adjusting for collateral and personal guarantees.
| Identifer | oai:union.ndltd.org:UTENN/oai:trace.tennessee.edu:utk_graddiss-1685 |
| Date | 01 December 2009 |
| Creators | Li, Tianning |
| Publisher | Trace: Tennessee Research and Creative Exchange |
| Source Sets | University of Tennessee Libraries |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | Doctoral Dissertations |
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