Browsing by Author "Hedencrona, Henrik"

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    Capital Structure in Financial Distress: A Comprehensive Study across Industries and Borders
    (2019-07-02) Baranov, Oleksandr; Hedencrona, Henrik; University of Gothenburg/Graduate School; Göteborgs universitet/Graduate School
    This paper examines the effects of financial distress on the relationships between capital structure and its determinants – continuing on the famous research by Rajan and Zingales from 1995. The sample contains balance sheet information for 3743 non-financial firms over a period of 14 years, classified into NAICS sectors and distributed across the G7 countries. Results reveal that financial stress (i) puts downwards pressure on the positive relationship between capital structure and tangible assets, (ii) causes a substantial shift in the negative link between capital structure and profitability, so much so that it be-comes strongly positive, (iii) has an ambiguous effect on the relationship between capital structure and investment opportunities, putting upwards pressure when measured at book leverage and downwards pressure when measured at market leverage, (iv) has weak impact on the relationship between capital structure and tangible assets in countries and sectors with high tangibility, (v) has strong impact on the relationship between capital structure and company size in countries and sectors with large firms, and (vi) has weak impact on the relationship between capital structure and profitability in countries and sectors with high profit margin.
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    The Development of the Relation Between the Swedish Repo Rate and the Three-month Mortgage Rate
    (2017-07-03) Hedencrona, Henrik; Olofsson, Ludwig; University of Gothenburg/Department of Economics; Göteborgs universitet/Institutionen för nationalekonomi med statistik
    This paper examines whether the effect of the Swedish repo rate on the mortgage rate has changed during the period between the years of 2005-2017. The relation between the repo rate and mortgage rate is examined during three time intervals using regressions and correlation analysis. Furthermore, the effect of the repo rate is investigated in times of negative and positive interest rate levels. The results show that the effect of the repo rate on the mortgage rate has decreased significantly with time. It is also shown that the repo rate tends to affect the mortgage rate less in times of negative interest rates. The reduced effect of the repo rate has then been analysed using the Transmission Mechanism of Monetary Policy to deduct probable factors causing the change. The factors mentioned consist of changes in risk behaviour and mortgage financing.