Congratulations to Barney School of Business Associate Professor of Finance Carmen Cotei, whose paper has been accepted for presentation at the 2015 Financial Management Association conference.
Cotei will present "Financing through Leasing: Evidence from the Kauffman Firm Survey," co-authored with J. Farhat. The paper was reviewed anonymously by at least two members of the Program Committee and was selected from among nearly 1,400 papers submitted for consideration.
Abstract: We analyze the impact of asset uniqueness and growth opportunities on the leasing decisions of U.S. startups using a unique dataset provided by the Kauffman Foundation. Our results show that startups in the high-technology sector have a lower propensity to lease while startups with high R&D intensity have a higher propensity to lease. In addition, we provide evidence that owners’ characteristics impact the leasing decisions, as female and older entrepreneurs as well as highly educated owners are less likely to lease. Our findings confirm previous studies on leasing decisions that larger and more leveraged businesses have a higher propensity to lease their assets. Consistent with Ang and Peterson (1984) and Bathala and Mukerjee (1995) we report that leasing and debt are complements rather than substitutes to each other.