Ownership and Capital Structure in Latin America

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General

Publicado en

• Journal of Business Research

Resumen

• This study evaluates the capital-structure determinants of Latin American firms using a comprehensive sample covering seven countries. Firms in the region have debt levels similar to those of U.S. firms, which is puzzling, given that Latin American firms experience relatively lower tax benefits and higher bankruptcy costs. This study argues that ownership-concentrated firms avoid issuing equity because they do not want to share control rights. Latin American firms have high ownership concentration, which creates an ideal setting to study how ownership concentration explains firms' capital structure. Consistent with the control argument, this study finds a positive relation between leverage and ownership concentration, when losing control becomes an issue. Also, the study shows a positive relation between leverage and growth. In addition, the study reports that other determinants that do not proxy for control rights are consistent with previous findings. Firms that are larger, have more tangible assets, and are less profitable are also more leveraged.

autores

• Céspedes, Jacelly
• González, Maximiliano
• Molina Manzano, Carlos A.

fecha de publicación

• 2010

Enfoque geográfico

• South America  Continent

Investigaciones

Líneas de investigación

• Capital Structure
• Emerging Markets
• Latin America
• Ownership Control

Información Adicional

Página inicial

• 248

Última página

• 254

Volumen

• 63

Issue

• 3