On the irrelevance of financial policy under market incompleteness and trading constraints

C-Tier
Journal: Economics Letters
Year: 2015
Volume: 136
Issue: C
Pages: 125-128

Authors (2)

Atesagaoglu, Orhan Erem (not in RePEc) Carceles-Poveda, Eva (Stony Brook University - SUNY)

Score contribution per author:

0.503 = (α=2.01 / 2 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We study the Modigliani and Miller Theorem under portfolio constraints. We show that there exist state-dependent trading limits under which financial policy is irrelevant. In addition, a no short-selling constraint on equity is innocuous in spite of being state-independent.

Technical Details

RePEc Handle
repec:eee:ecolet:v:136:y:2015:i:c:p:125-128
Journal Field
General
Author Count
2
Added to Database
2026-01-25