Capital Structure around the World: The Roles of Firm- and Country-Specific Determinants
2007-09-11
Research Paper
This publication is part of collection
Published by
Rotterdam School of Management (RSM) Erasmus University, Erasmus Research Institute of Management (ERIM)
| Related Files |
|---|
View PDF Version
(ERS-2007-058-F&A.pdf, 0.3MB) |
We analyze the importance of firm-specific and country-specific factors in the leverage choice of firms from 42 countries around the world. Our analysis yields two new results. First, we find that firm-specific determinants of leverage differ across countries, while prior studies implicitly assume equal impact of firm-specific factors. Second, although we concur with the conventional direct impact of country-specific factors on the capital structure of firms, we show that there is an indirect impact because country-specific factors also influence the roles of firm-specific determinants of leverage.
Keywords
Classifications using
Journal of Economic Literature (JEL) Classification System
- G3 : Corporate Finance and Governance
- G30 : Corporate Finance and Governance: General
- M : Business Administration and Business Economics; Marketing; Accounting
Automatically Extracted Terms
- country
- leverage
- firm-specific
- variable
- capital
- country-specific
- factor
- coefficient
- structure
- capital structure
- impact
- country-specific variables
- market
- hypothesis
- country-specific factors
- firm-specific determinants
- determinant
- table
- growth
- effect
