Do corporate policies follow a life-cycle?

• Published in: Journal of banking & finance Vol. 69; pp. 95 - 107
• Main Authors: Faff, Robert, Kwok, Wing Chun, Podolski, Edward J., Wong, George
• Format: Journal Article
• Language: English
• Published: Amsterdam Elsevier B.V 01.08.2016; Elsevier Sequoia S.A
• Subjects: Capital investments; Cash management; Cash policy; Corporate finance; Financing decisions; Interdependence; Investment decisions; Life cycles; Life-cycle theory; Studies; Financing decisions; Life-cycle theory; G31; Cash policy; G30; G32; G35; Investment decisions

We examine whether corporate investment, financing, and cash policies are interdependent and follow a predictable pattern in line with the firm life-cycle. We find that investments and equity issuance decrease with firm life-cycle, while debt issuance and cash holdings increase in the introduction a...