Publicação
An extensive approach to unemployment insurance benefits and corporate finance metrics - debt maturity
| Resumo: | This paper investigates how differences in the unemployment insurance scheme across US states influence firms’ financial metrics. We find that, over the 1981-2016 period, higher unemployment insurance benefits are associated with lower financial leverage through a crowding-out effect. In states with more generous UI benefits, creditors are willing to offer more favourable loan conditions, which translates into longer debt maturity. Furthermore, no statistically significant relationship was found between unemployment insurance generosity and an increase in credit ratings. |
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| Autores principais: | Pereira, Marta Fernandes Ferrão |
| Assunto: | Unemployment risk Unemployment insurance benefits Stakeholders Compensating wage differentials Capital structure Bank loans Debt maturity Interest coverage ratio Productivity Credit rating Employee welfare |
| Ano: | 2023 |
| País: | Portugal |
| Tipo de documento: | dissertação de mestrado |
| Tipo de acesso: | acesso aberto |
| Instituição associada: | Universidade Nova de Lisboa |
| Idioma: | inglês |
| Origem: | Repositório Institucional da UNL |
| Resumo: | This paper investigates how differences in the unemployment insurance scheme across US states influence firms’ financial metrics. We find that, over the 1981-2016 period, higher unemployment insurance benefits are associated with lower financial leverage through a crowding-out effect. In states with more generous UI benefits, creditors are willing to offer more favourable loan conditions, which translates into longer debt maturity. Furthermore, no statistically significant relationship was found between unemployment insurance generosity and an increase in credit ratings. |
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