Functional fixation: an investigation of the influence of earnings per share on company financing decisions
Mallin, Chris A. (1993) Functional fixation: an investigation of the influence of earnings per share on company financing decisions. PhD thesis, University of Nottingham.
In this thesis the various arguments that have been put forward for the determinants of a company's capital structure are examined critically. However, none of these succeeds convincingly in reflecting actual practice. Furthermore, it is argued that the common practice of concentrating on Earnings Per Share (EPS) as a key indicator of a company's performance also impacts on the capital issue choice, and that there is functional fixation on EPS, particularly short-term EPS. Therefore the effect on a company's EPS of a particular method of finance turns out to be an important influence on a company's financing decisions.
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