This book follows the intellectual path of Franco Modigliani, Nobel Prize winner and one of the most influential Keynesian economists of the twentieth century, tracing his development and examining ...the impact of his research.
The book begins with Modigliani's early work as a young law student in 1930s Italy and traces his development through his emigration to the US, his introduction to Keynes' General Theory at the New School, and his seminal 1944 article on Keynesian and classical economics. The book also examines Modigliani's pioneering theory of savings: the life-cycle hypothesis (with Richard Brumberg), and the Modigliani-Miller theorem, a cornerstone of modern theory of finance. The book argues that although Modigliani is placed amongst the most prominent Keynesian economists, his connections with Keynesian theory are of secondary importance until the beginning of the 1960s when he joined MIT.
This is the first book to place Modigliani's thought in its proper historical context, showing how it related to wider economic concerns and examining the social and political implications of his work. It will be of interest to scholars in the history of economic thought, and especially post-war American Keynesian economics.
This paper re-examines the origins of the Life-Cycle Hypothesis (LCH) originally formulated by Modigliani and Brumberg seventy years ago, using a combination of historical and archival analysis. The ...study compares Modigliani's own account of the LCH with a range of other sources, including papers presented at the Conference on Savings in 1952, contemporary literature, and PhD dissertations of Hamburger and Brumberg. The analysis reveals that the idea of the LCH was somehow "in the air" in the early 1950s, although Modigliani-Brumberg's formulation represents an ingenious theoretically-founded and empirically-testable formalisation of such a framework.
Debt finance, when considered a source of finance, always leads to financial risk; however, it is also considered a source of increased profitability in the normal business scenario. It has always ...been challenging to find the correct debt equity combination. In the discussed sample of the telecom industry in the USA, an abnormally high total liability-to-total assets ratio was observed. Thus, it is inclined to investigate the capital structure (CapSt) effect on firms’ profitability. By taking annual data of the telecom industry from 2012 to 2020 in the USA, unbalanced cross-sectional data (panel data) comprising 421 firm-year observations for 72 firms were studied using pooled panel regression, univariate analysis, correlation, and descriptive statistics models. We decided to test the impact of CapSt (Total Liabilities to Total Assets (TLsTAs) and Total Equity to Total Assets (TETAs)) on the profitability (Return on Assets (ROA) and Return on Equity (ROE)) of firms in the telecommunication industry in the USA. The results reveal that the ratio of TLsTAs has a significant impact on ROA, and TETAs has a significant impact on ROA. However, TLsTAs and TETAs have no impact on ROE.
Intellectual capital is by far the most important factor in enhancing organizational performance. Companies require skilled workers who have the know-how, skills, experience, as well as the ability ...to bring new ideas for the success of the business. The contemporary economy is a knowledge-based economy, which means that information, knowledge, and other intangible assets are considered to be more valuable than physical commodities. The present research is aimed at investigating the connection between intellectual capital and organizational performance among the business sectors of Turkiye. The current research uses the current dataset of the business sectors of Turkey from 2009 to 2021. The Autoregressive Distributive Lag technique, which provides robust results on short-time period dataset, is employed to investigate this association. The present research differs from past studies in that it uses secondary data in analyzing the effect of human capital component of IC on firm performance, hence the originality of this research. Past research has widely examined the association of intellectual capital (IC) and firm performance with primary data. The major results of the present research show the importance of debt and equity finance in raising organizational performance. The results also show that long-term liability and intellectual capital reduce firm profitability. The present research gives crucial policy recommendations that are vital for policy making.
Since it first appeared, agency theory has argued that debt can decrease agency issues between agent and principal and enhance the value of firms. This paper explores the moderating effect of agency ...cost on the association between capital structure and firm performance. A panel econometric method, namely a fixed-effect regression model, was used to evaluate the above description. This investigation uses secondary data collected from published annual reports of manufacturing firms listed on Tehran Stock Exchange (TSE) during 2011–2019. Empirical results show that capital structure is negatively related to firm performance. Agency cost also has a negative impact on corporate performance; however, in the case of ROA and EPS, the relationship is positive. Interestingly, the findings illustrate that increasing the level of debt can reduce agency costs and enhance firm performance. Moreover, robust correlations are revealing that agency cost significantly affects the relationship between capital structure and corporate performance. These findings provide proof to support the assumptions of agency theory, which explains the association between capital structure and performance of firms. This study provides new perspectives on the relationship between capital structure and firm performance by using data from listed manufacturing firms in Iran; hence, these new insights from a developing market improve the understanding of capital structure in Asian and Middle Eastern markets.
This research investigates the relationship between capital structure and firm value for companies listed on the Vietnamese stock market. The study utilizes data from audited financial statements of ...769 companies spanning from 2012 to 2022, amounting to 8459 observations. Employing various estimation methods, such as ordinary least squares (OLS), fixed effects model (FEM), random effects model (REM), and generalized least squares (GLS), the impact of capital structure on key financial indicators, namely, return on assets (ROA), return on equity (ROE), and Tobin’s Q, is assessed. The findings indicate that the debt ratio exhibits a positive influence on ROA, ROE, and Tobin’s Q, with Tobin’s Q displaying the most pronounced impact (0.450) and ROA showing the weakest impact (0.011). However, the long-term debt ratio does not significantly affect firm value. Interestingly, both short-term and long-term debt ratios have negative effects on ROA, ROE, and Tobin’s Q, with the most substantial impact on Tobin’s Q reduction (0.562). Based on these research outcomes, the authors offer valuable recommendations to companies, investors, business leaders, and policymakers to make informed decisions in selecting an optimal and sensible capital structure.
Living annuity satisfaction de Villiers-Strijdom, Jeannie; Krige, Niel
Journal of Economic and Financial Sciences,
05/2023, Volume:
16, Issue:
1
Journal Article
Peer reviewed
Open access
Orientation As a standard practice, retirement capital is converted into either an immediate life annuity (annuitisation), affording significant protection against longevity risk or a living annuity ...(self-annuitisation), exposing capital to volatile investment returns.Research purpose This article presents a number of exploratory factors (based on annuity puzzle literature) that associate with retirees’ satisfaction levels, with respect to the eventual outcome of their living annuity choice.Motivation for the study Reticence among retirees to protect themselves against longevity risk is an annuity puzzle that has been the subject of vigorous academic debate.Research approach and method A quantitative research approach was followed by performing an ordinary least squares (OLS) linear multiple regression analysis in order to ascertain which factors associate with the satisfaction levels of living annuitants.Main findings The most interesting conclusion is that, although one would expect active involvement in managing retirement capital among living annuitants to contribute to satisfaction levels, the desire to control and manage living annuity capital in the pursuance of capital growth, actually significantly contributes to retiree discontentment or dissatisfaction.Practical implications Financial education and counselling with respect to optimal annuity decision-making could restore the promise of retirement income security.Contribution Identifying the annuity puzzle factors (previously mainly reserved for immediate life annuities) that are associated with living annuitant satisfaction levels, serve as the basis for the contribution of this study.
