What question did this study set out to answer?

This research aims to understand how capital leases relate to the market risk of lessees.

The Debt Equivalence of Leases: An Empirical Investigation.

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Empirical investigation reveals leases impact market risk in lessees, suggesting important financial implications.

This research aims to understand how capital leases relate to the market risk of lessees.
Used capitalized value of leases as reported to the SEC to measure lease obligations.
Applied a multiple regression model to analyze the relationship between lease value and market risk.
Controlled for multicollinearity using two tests to improve accuracy.
Initial tests showed no significant association between lease value and market risk.
Leverage and lease variables were found to be highly correlated.
When controlling for multicollinearity, leases significantly contributed to explaining market risk.

Robert G. Bowman (1980) studied this question.

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