SIGNALING APPROACH


Meaning of SIGNALING APPROACH in English

Approach to the determination of the optimal capital structure asserting that insiders in a firm have information that the market does not have; therefore, the choice of capital structure by insiders can signal information to outsiders and change the value of the firm. This theory is also called the asymmetric information approach.

Campbell R. Harvey. Hypertextual finance English glossary.      Английский словарь гипертекстовых финансов.