This article reviews empirical capital structure research, concentrating on papers published
since 2005. We begin by documenting three dimensions of capital structure variation: cross …

Taxes, bankruptcy costs, transactions costs, adverse selection, and agency conflicts have all
been advocated as major explanations for the corporate use of debt financing. These ideas …

We find that shocks to the equity capital ratio of financial intermediaries—Primary Dealer
counterparties of the New York Federal Reserve—possess significant explanatory power for …

I study the role of firms' balance sheet liquidity in the transmission of monetary policy to
investment. In response to monetary contractions, US firms with fewer liquid asset holdings …

We present evidence that banking development plays a key role in technological progress.
We focus on manufacturing firms' innovative performance, measured by patent-based …

During the recent financial crisis, corporate borrowing and capital expenditures fall sharply.
Most existing research links the two phenomena by arguing that a shock to bank lending (or …

We show that peer firms play an important role in determining corporate capital structures
and financial policies. In large part, firms' financing decisions are responses to the financing …

This paper examines the relative importance of many factors in the capital structure
decisions of publicly traded American firms from 1950 to 2003. The most reliable factors for …

Using staggered corporate income tax changes across US states, we show that taxes have a
first-order effect on capital structure. Firms increase leverage by around 40 basis points for …

This paper explores the connection between rising intangible capital and the secular
upward trend in US corporate cash holdings. We calibrate a dynamic model with two …