Through a dynamic panel data analysis of a sample of Nordic firms we investigate how executives’ stock and option incentives influence the choice of capital structure. In addition, we look at how equity ownership by a large external shareholder influences the incentives’ effect on capital structure. Our results show that options have a negative effect on debt level, while stock holdings’ influence is more diffuse. We also see that only options have both a statistical and economical significant impact on leverage, and therefore operate as a stronger incentive than stocks. No significant dependency is found between the size of the largest external shareholder and the incentives’ effect on capital structure. Still, we see a weak trend indicating that the effect of equity based incentives is stronger when firms’ largest shareholders are institutional.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:ntnu-15038 |
| Date | January 2011 |
| Creators | Birkeland, Mariell Kversøy, Eriksen, Ane Eidem, Ueland, Ellen |
| Publisher | Norges teknisk-naturvitenskapelige universitet, Institutt for industriell økonomi og teknologiledelse, Norges teknisk-naturvitenskapelige universitet, Institutt for industriell økonomi og teknologiledelse, Norges teknisk-naturvitenskapelige universitet, Institutt for industriell økonomi og teknologiledelse, Institutt for industriell økonomi og teknologiledelse |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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