Contribution to EVA from Debt and Equity
Attempts to measure the economic value contributed to the company by the capital structure present various methodologies that bring together large working teams, whose proposals focus their analysis from the characteristics of the manager to models adjusted to their life cycle. This research address...
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| Format: | Article |
| Language: | English |
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Universidad Autónoma de Chile, Facultad de Administración y Negocios
2024-04-01
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| Series: | Journal of Management and Business Studies |
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| Online Access: | https://revistas.uautonoma.cl/index.php/jmabs/article/view/2356 |
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| author | Nelson Iván Araya-Canelo Fernando Crespo Romero |
| author_facet | Nelson Iván Araya-Canelo Fernando Crespo Romero |
| author_sort | Nelson Iván Araya-Canelo |
| collection | DOAJ |
| description | Attempts to measure the economic value contributed to the company by the capital structure present various methodologies that bring together large working teams, whose proposals focus their analysis from the characteristics of the manager to models adjusted to their life cycle. This research addresses this problem by measuring the contribution to economic value through the capital structure, using the Economic Value Added (EVA) method as a basis, and then modifying its analysis variables to quantify the economic value added from debt and equity, which in this work is called Modified Added Economic Value (MEVA). A methodology is proposed to estimate the incremental economic value per monetary unit of financial debt acquired. The main results show that MEVA captures the disaggregated performance of debt and equity management. Moreover, to the extent that profit tax increases, debt is more desirable than equity issuance. |
| format | Article |
| id | doaj-art-3f8828db4cc94740bc5a7d477f6cee23 |
| institution | DOAJ |
| issn | 2452-5340 |
| language | English |
| publishDate | 2024-04-01 |
| publisher | Universidad Autónoma de Chile, Facultad de Administración y Negocios |
| record_format | Article |
| series | Journal of Management and Business Studies |
| spelling | doaj-art-3f8828db4cc94740bc5a7d477f6cee232025-08-20T03:06:04ZengUniversidad Autónoma de Chile, Facultad de Administración y NegociosJournal of Management and Business Studies2452-53402024-04-015211210.32457/jmabs.v5i2.23562356Contribution to EVA from Debt and EquityNelson Iván Araya-Canelo0https://orcid.org/0000-0002-4435-9301Fernando Crespo Romero1https://orcid.org/0000-0001-9918-4492Universidad Autónoma de ChileUniversidad Alberto Hurtado, ChileAttempts to measure the economic value contributed to the company by the capital structure present various methodologies that bring together large working teams, whose proposals focus their analysis from the characteristics of the manager to models adjusted to their life cycle. This research addresses this problem by measuring the contribution to economic value through the capital structure, using the Economic Value Added (EVA) method as a basis, and then modifying its analysis variables to quantify the economic value added from debt and equity, which in this work is called Modified Added Economic Value (MEVA). A methodology is proposed to estimate the incremental economic value per monetary unit of financial debt acquired. The main results show that MEVA captures the disaggregated performance of debt and equity management. Moreover, to the extent that profit tax increases, debt is more desirable than equity issuance.https://revistas.uautonoma.cl/index.php/jmabs/article/view/2356evaeconomic value addedcapital structureleverage |
| spellingShingle | Nelson Iván Araya-Canelo Fernando Crespo Romero Contribution to EVA from Debt and Equity Journal of Management and Business Studies eva economic value added capital structure leverage |
| title | Contribution to EVA from Debt and Equity |
| title_full | Contribution to EVA from Debt and Equity |
| title_fullStr | Contribution to EVA from Debt and Equity |
| title_full_unstemmed | Contribution to EVA from Debt and Equity |
| title_short | Contribution to EVA from Debt and Equity |
| title_sort | contribution to eva from debt and equity |
| topic | eva economic value added capital structure leverage |
| url | https://revistas.uautonoma.cl/index.php/jmabs/article/view/2356 |
| work_keys_str_mv | AT nelsonivanarayacanelo contributiontoevafromdebtandequity AT fernandocresporomero contributiontoevafromdebtandequity |