Myers (1984)

Myers, Stewart. "The Capital Structure Puzzle." Journal of Finance, July 1984.

This review of the literature of capital structure seeks to explain the apparent contradiction between theory, which suggests that firms should balance the tax benefits of borrowing against the perceived risk of financial distress, and the empirical evidence of firm capital structure, which implies that firms borrow sparingly, and prefer to maintain reserve borrowing power. Argues that "financial slack...is valuable." This is important if Waddock and Graves (1997a) are correct that corporate social responsibility can increase financial flexibility ("slack") by improving stakeholder relations.

See also Graham and Leary (2011).

Link:  https://onlinelibrary.wiley.com/doi/full/10.1111/j.1540-6261.1984.tb03646.x