Purpose: This paper aims to investigate how the relation between stock returns of US firms and West Texas Intermediate (WTI) oil prices is affected by leverage from 1990 to 2020.Design/methodology/approach: This paper examines how the relationship between stock returns of US firms and WTI oil prices is affected by leverage from 1990 to 2020 using a fixed-effect model estimation framework.Findings: Results from the fixed-effect regression models suggest that leverage effects on stock returns are pervasive both in aggregate and cross-industry levels, while the mining industry is more sensitive. In addition to the positive oil price effects attenuated by leverage at the aggregate level, the authors observe stronger marginal effects of leverage only for the mining sector. Being more exposed to commodity prices, the positive effects of oil prices on stock returns in the mining sector are offset by large debt ratios. Asymmetries, effects of debt maturity structure and implications are also discussed.Research limitations/implications: This study is grounded on the contemporary cash flow claim of leverage NOT on the long-run effect of leverage considering cash flow constraints. The oil price increase is assumed to represent an advancement of the overall economy. This study does not capture the oil prices response to some other economic forces and vice-versa.Practical implications: Mining companies should therefore reduce the stock of debt with respect to their assets to make possible the “pass-through” from oil prices to the stock market.Originality/value: Previously undocumented and the authors show that leverage reduces the total effect of oil prices on stock returns, consistent with the hypothesis. Asymmetric and debt maturity structures effects are also discussed.

Understanding the risky nature of the airline industry has received attention in the tourism literature from separate angles. Although the systematic risk of the airline industry has been examined before, idiosyncratic risk has largely been ignored. This study fills this gap in the tourism literature by investigating the effect of passengers’ air travel on systematic and idiosyncratic risks of the U.S. airline industry. Using historical air travel data and utilizing both OLS and fixed-effect models, this paper documents negative relationships between the occupancy of airline seats and idiosyncratic risks for 21 U.S. airline companies. This negative effect of occupancy is more pronounced if air travel distances are shorter, companies have lower leverage ratios, and companies are smaller in size. Policy implications for both airline managers and investors are provided.

Purpose: In this study, we examine how the adoption of Paid Maternity Leave (PML) across U.S. states affects firms’ debt-maturity choices. Using a staggered difference-in-differences approach, we find that firms in PML states rely less on short-term debt financing. This effect appears to be driven by lower performance volatility and increased investment in research and development and brand capital. Design/methodology/approach: Our sample comprises all non-financial, non-utility firms at the intersection of CRSP and Compustat between 1998 to 2022. We run a multivariate regression framework with fixed effects using the staggered enactment of Paid Maternity Leave (PML) laws across U.S. states and a difference-in-differences approach. Our main dependent variable, is one-year lead value of short-term debt proxies. The key variable of interest in this study is PML, which are the paid maternity leave laws implemented by several US states over time since 2002. Findings: Firms in PML-implemented states reduce their reliance on short-term debt as compared to the firms in non-PML implemented states. This effect operates through improved operational stability, reduced legal exposure, and more efficient working capital management, along with an increased reliance on trade credit. Importantly, we also find that PML laws are associated with greater investment in research and development and brand capital, suggesting that such policies may foster a longer-term, innovation-oriented corporate strategy. Originality/value: This manuscript is appropriate for publication because it addresses an unanswered question of how the adoption of PML affects firms' debt maturity choices. Future research on capital structure will highly be benefitted from our study. This manuscript has not been published and is not under consideration for publication elsewhere.

Understanding the risk nature of the airline industry has received attention in the tourism literature from separate angles. Although the systematic risk of the airline industry has been examined before, idiosyncratic risk has largely been ignored. This study fills this gap in the tourism literature by investigating the effect of passengers’ air travel on systematic and idiosyncratic risks of the U.S. airline industry. Using historical air travel data and utilizing both OLS and fixed-effect models, this paper documents negative relationships between the occupancy of airline seats and idiosyncratic risks for 21 U.S. airline companies from 1990 to 2019. This negative effect of occupancy is more pronounced if aircraft travel distances are shorter and companies have lower leverage ratios. Policy implications for both airline managers and investors are provided.