IDEAS home Printed from https://ideas.repec.org/p/cir/cirwor/96s-03.html
   My bibliography  Save this paper

Solutions au stress financier : Un survol de la littérature

Author

Listed:
  • Jocelyn Martel

Abstract

This article presents a survey of the solutions offered to firms in financial distress. The first section examines the role of debt in the firms' financing decisions. In particular, we discuss the impact of the use of debt on the value of the firm and its importance in the presence of asymmetric information and agency costs. The second section presents a discussion of the solutions to financial distress with a particular emphazis on the use of the bankruptcy law. We discuss the functionning of the Canadian bankruptcy law, the problems arising from the use of legal frameworks such as those prevailing in Canada and in the U.S., as well as a number of alternative mechanisms to the existing legal system. Ce survol de la littérature offre un aperçu des différentes solutions au stress financier des entreprises. La première section passe en revue les différents rôles joués par la dette dans le cadre de la politique de financement des entreprises. Nous y discutons, entre autres, de l'impact de l'utilisation de la dette sur la valeur de la firme et de son importance pour réduire les problèmes liés à la présence d'asymétrie d'information ex ante et ex post. La deuxième section traite des solutions au stress financier et plus particulièrement de celle associée à l'utilisation de la loi sur la faillite. Nous y retrouvons une description du fonctionnement de la loi canadienne, des problèmes engendrés par l'utilisation de cadres légaux tels que ceux en vigueur au Canada et aux États-Unis ainsi que de mécanismes alternatifs comme solution au stress financier.

Suggested Citation

  • Jocelyn Martel, 1996. "Solutions au stress financier : Un survol de la littérature," CIRANO Working Papers 96s-03, CIRANO.
    • Handle: RePEc:cir:cirwor:96s-03
    as

    Download full text from publisher

    File URL: https://cirano.qc.ca/files/publications/96s-03.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Philippe Aghion & Oliver D. Hart & John Moore, 1994. "The Economics of Bankruptcy Reform," NBER Chapters, in: The Transition in Eastern Europe, Volume 2, Restructuring, pages 215-244, National Bureau of Economic Research, Inc.
    2. Bradley, Michael & Jarrell, Gregg A & Kim, E Han, 1984. "On the Existence of an Optimal Capital Structure: Theory and Evidence," Journal of Finance, American Finance Association, vol. 39(3), pages 857-878, July.
    3. Jensen, Michael C, 1986. "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, American Economic Association, vol. 76(2), pages 323-329, May.
    4. White, Michelle J, 1983. "Bankruptcy Costs and the New Bankruptcy Code," Journal of Finance, American Finance Association, vol. 38(2), pages 477-488, May.
    5. Stephen A. Ross, 1977. "The Determination of Financial Structure: The Incentive-Signalling Approach," Bell Journal of Economics, The RAND Corporation, vol. 8(1), pages 23-40, Spring.
    6. Robichek, Alexander A. & Myers, Stewart C., 1966. "Problems in the Theory of Optimal Capital Structure," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 1(2), pages 1-35, June.
    7. Kim, E Han, 1978. "A Mean-Variance Theory of Optimal Capital Structure and Corporate Debt Capacity," Journal of Finance, American Finance Association, vol. 33(1), pages 45-63, March.
    8. Fisher, Timothy C G & Martel, Jocelyn, 1995. "The Creditors' Financial Reorganization Decision: New Evidence from Canadian Data," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 11(1), pages 112-126, April.
    9. Stiglitz, Joseph E, 1974. "On the Irrelevance of Corporate Financial Policy," American Economic Review, American Economic Association, vol. 64(6), pages 851-866, December.
    10. Myers, Stewart C. & Majluf, Nicholas S., 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Journal of Financial Economics, Elsevier, vol. 13(2), pages 187-221, June.
    11. Philippe Aghion & Patrick Bolton, 1992. "An Incomplete Contracts Approach to Financial Contracting," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 59(3), pages 473-494.
    12. Harris, Milton & Raviv, Artur, 1991. "The Theory of Capital Structure," Journal of Finance, American Finance Association, vol. 46(1), pages 297-355, March.
    13. Easterbrook, Frank H., 1990. "Is corporate bankruptcy efficient?," Journal of Financial Economics, Elsevier, vol. 27(2), pages 411-417, October.
    14. Eberhart, Allan C & Moore, William T & Roenfeldt, Rodney L, 1990. "Security Pricing and Deviations from the Absolute Priority Rule in Bankruptcy Proceedings," Journal of Finance, American Finance Association, vol. 45(5), pages 1457-1469, December.
    15. Jocelyn Martel, 1991. "Bankruptcy Law and the Canadian Experience: An Economic Appraisal," Canadian Public Policy, University of Toronto Press, vol. 17(1), pages 52-63, March.
    16. Haugen, Robert A & Senbet, Lemma W, 1978. "The Insignificance of Bankruptcy Costs to the Theory of Optimal Capital Structure," Journal of Finance, American Finance Association, vol. 33(2), pages 383-393, May.
    17. Bebchuk, Lucian Ayre & Chang, Howard F, 1992. "Bargaining and the Division of Value in Corporate Reorganization," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 8(2), pages 253-279, April.
    18. Titman, Sheridan, 1984. "The effect of capital structure on a firm's liquidation decision," Journal of Financial Economics, Elsevier, vol. 13(1), pages 137-151, March.
    19. Baird, Douglas G, 1993. "Revisiting Auctions in Chapter 11," Journal of Law and Economics, University of Chicago Press, vol. 36(1), pages 633-653, April.
    20. White, Michelle J, 1994. "Corporate Bankruptcy as a Filtering Device: Chapter 11 Reorganizations and Out-of-Court Debt Restructurings," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 10(2), pages 268-295, October.
    21. Myers, Stewart C., 1984. "Capital structure puzzle," Working papers 1548-84., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    22. repec:bla:econom:v:54:y:1987:i:215:p:279-88 is not listed on IDEAS
    23. repec:cep:stitep:/1991/233 is not listed on IDEAS
    24. Jackson, Thomas H, 1993. "Revisiting Auctions in Chapter 11: Comment," Journal of Law and Economics, University of Chicago Press, vol. 36(1), pages 655-669, April.
    25. Franks, Julian R. & Torous, Walter N., 1994. "A comparison of financial recontracting in distressed exchanges and chapter 11 reorganizations," Journal of Financial Economics, Elsevier, vol. 35(3), pages 349-370, June.
    26. Myers, Stewart C, 1984. "The Capital Structure Puzzle," Journal of Finance, American Finance Association, vol. 39(3), pages 575-592, July.
    27. Oliver Hart & John Moore, 1994. "A Theory of Debt Based on the Inalienability of Human Capital," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(4), pages 841-879.
    28. Stewart C. Myers, 1984. "Capital Structure Puzzle," NBER Working Papers 1393, National Bureau of Economic Research, Inc.
    29. Brown, David T, 1989. "Claimholder Incentive Conflicts in Reorganization: The Role of Bankruptcy Law," The Review of Financial Studies, Society for Financial Studies, vol. 2(1), pages 109-123.
    30. Stewart C. Myers & Nicholas S. Majluf, 1984. "Corporate Financing and Investment Decisions When Firms Have InformationThat Investors Do Not Have," NBER Working Papers 1396, National Bureau of Economic Research, Inc.
    31. James H. Scott Jr., 1976. "A Theory of Optimal Capital Structure," Bell Journal of Economics, The RAND Corporation, vol. 7(1), pages 33-54, Spring.
    32. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    33. Jocelyn Martel, 1994. "Commercial Bankruptcy and Financial Reorganization in Canada," CIRANO Papers 94c-02, CIRANO.
    34. Poitevin, M., 1989. "Information et Marche Financiers : une Revue de la Litterature," Cahiers de recherche 8930, Universite de Montreal, Departement de sciences economiques.
    35. Van Horne, James C, 1976. "Optimal Initiation of Bankruptcy Proceedings by Debt Holders," Journal of Finance, American Finance Association, vol. 31(3), pages 897-910, June.
    36. Timothy C. G. Fisher & Jocelyn Martel, 1994. "Will the Bankruptcy Reform Work? An Empirical Analysis of Financial Reorganization in Canada," Canadian Public Policy, University of Toronto Press, vol. 20(3), pages 265-277, September.
    37. Hart, Oliver & Moore, John, 1995. "Debt and Seniority: An Analysis of the Role of Hard Claims in Constraining Management," American Economic Review, American Economic Association, vol. 85(3), pages 567-585, June.
    38. Haugen, Robert A. & Senbet, Lemma W., 1988. "Bankruptcy and Agency Costs: Their Significance to the Theory of Optimal Capital Structure," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 23(1), pages 27-38, March.
    39. repec:bla:jfinan:v:43:y:1988:i:1:p:1-19 is not listed on IDEAS
    40. Altman, Edward I, 1984. "A Further Empirical Investigation of the Bankruptcy Cost Question," Journal of Finance, American Finance Association, vol. 39(4), pages 1067-1089, September.
    41. Aivazian, Varouj A. & Callen, Jeffrey L., 1983. "Reorganization in bankruptcy and the issue of strategic risk," Journal of Banking & Finance, Elsevier, vol. 7(1), pages 119-133, March.
    42. Castanias, Richard, 1983. "Bankruptcy Risk and Optimal Capital Structure," Journal of Finance, American Finance Association, vol. 38(5), pages 1617-1635, December.
    43. repec:cep:stitep:/1992/250 is not listed on IDEAS
    44. Warner, Jerold B., 1977. "Bankruptcy, absolute priority, and the pricing of risky debt claims," Journal of Financial Economics, Elsevier, vol. 4(3), pages 239-276, May.
    45. Stiglitz, Joseph E & Weiss, Andrew, 1981. "Credit Rationing in Markets with Imperfect Information," American Economic Review, American Economic Association, vol. 71(3), pages 393-410, June.
    46. White, Michelle J, 1989. "The Corporate Bankruptcy Decision," Journal of Economic Perspectives, American Economic Association, vol. 3(2), pages 129-151, Spring.
    47. Jocelyn Martel, 1995. "Signaling in Financial Reorganization: Theory and Evidence from Canada," CIRANO Working Papers 95s-34, CIRANO.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alexis Direr, 2002. "Crédit interentreprises et risque de système," Recherches économiques de Louvain, De Boeck Université, vol. 68(3), pages 371-384.
    2. Fisher, Timothy C G & Martel, Jocelyn, 1999. "Should We Abolish Chapter 11? Evidence from Canada," The Journal of Legal Studies, University of Chicago Press, vol. 28(1), pages 233-257, January.
    3. Chopard, Bertrand, 2004. "Enchères, redressement ou liquidation judiciaire," L'Actualité Economique, Société Canadienne de Science Economique, vol. 80(4), pages 655-669, Décembre.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Martel, Jocelyn, 1996. "Solutions au stress financier," L'Actualité Economique, Société Canadienne de Science Economique, vol. 72(1), pages 51-78, mars.
    2. Bayan M Arqawi & William J Bertin & Laurie Prather, 2014. "The impact of product warranties on the capital structure of Australian firms," Australian Journal of Management, Australian School of Business, vol. 39(2), pages 207-225, May.
    3. Drobetz, Wolfgang & Pensa, Pascal & Wöhle, Claudia B., 2004. "Kapitalstrukturtheorie in Theorie und Praxis: Ergebnisse einer Fragebogenuntersuchung," Working papers 2004/09, Faculty of Business and Economics - University of Basel.
    4. Sanjiva Prasad & Christopher J. Green & Victor Murinde, 2005. "Company Financial Structure: A Survey and Implications for Developing Economies," Chapters, in: Christopher J. Green & Colin Kirkpatrick & Victor Murinde (ed.), Finance and Development, chapter 12, Edward Elgar Publishing.
    5. Antonczyk, Ron Christian & Salzmann, Astrid Juliane, 2014. "Overconfidence and optimism: The effect of national culture on capital structure," Research in International Business and Finance, Elsevier, vol. 31(C), pages 132-151.
    6. Joliet, Robert & Muller, Aline, 2013. "Capital structure effects of international expansion," Journal of Multinational Financial Management, Elsevier, vol. 23(5), pages 375-393.
    7. T. Pham & D. Chow, 1989. "Some Estimates of Direct and Indirect Bankruptcy Costs in Australia: September 1978–May 1983," Australian Journal of Management, Australian School of Business, vol. 14(1), pages 75-95, June.
    8. Sanjiva Prasad & Christopher J. Green & Victor Murinde, 2001. "Company Financing, Captial Structure, and Ownership: A Survey, and Implications for Developing Economies," SUERF Studies, SUERF - The European Money and Finance Forum, number 12 edited by Morten Balling, May.
    9. Maria Angelina Valadares Silva & António Melo Cerqueira & Elísio Brandão, 2017. "The Determinants of Capital Structure: Evidence from Non-financial Listed German Companies," FEP Working Papers 588, Universidade do Porto, Faculdade de Economia do Porto.
    10. Schauten, M.B.J. & Spronk, J., 2006. "Optimal Capital Structure: Reflections on Economic and Other Values," ERIM Report Series Research in Management ERS-2006-074-F&A, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    11. Cardone Riportella, Clara & Cazorla Papis, Leonardo, 2001. "New approaches to the analysis of the capital structure of SME's: empirical evidence from Spanish firms," DEE - Working Papers. Business Economics. WB wb011003, Universidad Carlos III de Madrid. Departamento de Economía de la Empresa.
    12. Stein, Jeremy C., 2003. "Agency, information and corporate investment," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, edition 1, volume 1, chapter 2, pages 111-165, Elsevier.
    13. Cardone Riportella, Clara & Casasola, María José, 2003. "What do we know about the financial behaviour of the Spanish SME?: an empirical analysis," DEE - Working Papers. Business Economics. WB wb033708, Universidad Carlos III de Madrid. Departamento de Economía de la Empresa.
    14. Dimitris Margaritis & Maria Psillaki, 2007. "Capital Structure and Firm Efficiency," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 34(9‐10), pages 1447-1469, November.
    15. Hege, Ulrich, 2003. "Workouts, court-supervised reorganization and the choice between private and public debt," Journal of Corporate Finance, Elsevier, vol. 9(2), pages 233-269, March.
    16. Rizov, Marian, 2008. "Corporate capital structure and how soft budget constraints may affect it," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 22(4), pages 648-684.
    17. Rumpf, Dominik, 2013. "Zinsbereinigung bei der Dualen Einkommensteuer," Beiträge zur Finanzwissenschaft, Mohr Siebeck, Tübingen, edition 1, volume 32, number urn:isbn:9783161528699, May.
    18. Chen, Linda H. & Jiang, George J., 2001. "The financing behavior of Dutch firms," Research Report 01E54, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    19. Michelle J. White, 2005. "Economic Analysis of Corporate and Personal Bankruptcy Law," NBER Working Papers 11536, National Bureau of Economic Research, Inc.
    20. Maria Psillaki & Nikolaos Daskalakis, 2009. "Are the determinants of capital structure country or firm specific?," Small Business Economics, Springer, vol. 33(3), pages 319-333, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cir:cirwor:96s-03. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Webmaster (email available below). General contact details of provider: https://edirc.repec.org/data/ciranca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.