Debt and taxes. A multiperiod investigation

Amir Barnea, Eli Talmor, Robert A. Haugen

Research output: Contribution to journalArticlepeer-review

Abstract

This paper extends the Miller bond market equilibrium analysis to a multiperiod setting. From the model developed we derive several predictions relating optimal financial leverage to firm characteristics and to the business cycle. The analysis also reveals some interesting determinants of the market value of the tax subsidy associated with corporate debt.

Original languageEnglish
Pages (from-to)79-97
Number of pages19
JournalJournal of Banking and Finance
Volume11
Issue number1
DOIs
StatePublished - Mar 1987

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