Finance and Financial Management Commons^™

Three Essays On Corporate Liquidity, Financial Crisis, And Real Estate, Kimberly Fowler Luchtenberg

Theses and Dissertations in Business Administration

The first essay examines why firms with access to lines of credit (LOC) have different drawdowns and their implications for asset pricing, investment and profitability. Utilizing a hand-collected LOC dataset that extends the sample of Sufi (2009) to 2010, our principal finding is that firms with greater LOC usage are more financially constrained than firms with lower LOC usage. We also document that high users of credit lines have higher risk-adjusted returns, less investment in capital expenditures and employment, and lower profitability than low LOC users. An interesting implication of our evidence is that high LOC drawdowns could serve as …