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Title: | The role of debt maturity in stock price crash risk : a comparison of developing and developed Asian economies | Authors: | Haider, MJ Ahmad, M Wu, Q |
Issue Date: | 2024 | Source: | Journal of Asian business and economic studies, 2024, Article publication date: 12 April 2024, ahead-of-print, https://doi.org/10.1108/JABES-06-2023-0198 | Abstract: | Purpose: This study examines the impact of debt maturity structure on stock price crash risk (SPCR) in Asian economies and the moderating effect of firm age on this relationship. Design/methodology/approach: The study utilized annual data from 432 nonfinancial firms publicly listed in six Asian countries: China, Hong Kong, Japan, Singapore, Pakistan and India. The observation period covers 14 years, from 2007 to 2020. The sample was categorized into three groups: the entire sample and one group each for developing and developed Asian economies. A generalized least squares panel regression method was employed to test the research hypotheses. Findings: The results suggest that long-term debt has a significant negative influence on SPCR in Asian economies, indicating that firms with high long-term debt experience lower future SPCR. Moreover, firm age negatively moderates this relationship, implying that older firms may experience a more pronounced reduction in SPCR due to high long-term debt. Finally, firms in developed Asian economies with high long-term debt are more effective in mitigating the risk of a significant drop in their stock prices than firms in developing Asian economies. Originality/value: This study contributes to the literature in several ways. To the best of the researcher’s knowledge, this is the first of such efforts to investigate the relationship between debt maturity structure and crash risk in Asia. Additionally, it reveals that long-term debt influences SPCR directly and indirectly in Asia through the moderating role of firm age. Lastly, it is likely one of the first studies by a research team in Asia to compare the nonfinancial markets of developed and developing Asian countries. |
Keywords: | Debt maturity Generalized least squares Stock price crash risk |
Publisher: | Emerald Publishing Limited | Journal: | Journal of Asian business and economic studies | ISSN: | 2615-9112 | EISSN: | 2515-964X | DOI: | 10.1108/JABES-06-2023-0198 | Rights: | © Muhammad Jawad Haider, Maqsood Ahmad and Qiang Wu. Published in Journal of Asian Business and Economic Studies. Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works ofthis article (for both commercial andnon-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode The following publication Haider, M.J., Ahmad, M. and Wu, Q. (2024), "The role of debt maturity in stock price crash risk: a comparison of developing and developed Asian economies", Journal of Asian Business and Economic Studies, Vol. ahead-of-print No. ahead-of-print is available at https://doi.org/10.1108/JABES-06-2023-0198. |
Appears in Collections: | Journal/Magazine Article |
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