Leasing and Secondary Markets: Theory and Evidence from Commercial Aircraft

摘要: I construct a dynamic model of transactions in used capital to understand the role leasing when trading is subject frictions. Firms trade assets adjust their productive capacity response shocks profitability. Transaction costs hinder efficiency allocation capital, and lessors act as intermediaries who reduce The predicts that leased more frequently produce output than owned assets, for two reasons. First, high-volatility firms are likely lease low-volatility firms, since they expect frequently. Second, ownership's larger transaction widen owners' inaction bands relative lessees'. Using data on commercial aircraft, find aircraft have holding durations 38-percent shorter fly 6.5-percent hours aircraft. Additional tests indicate most these differential patterns utilization arise because owners wider lessees, carriers' self-selection into plays minor role.