Abstract

http://ssrn.com/abstract=1317931
 
 

References (39)



 
 

Citations (2)



 


 



International Variations in Transparency and Capital Structure: Evidence from European Firms


Raj Aggarwal


University of Akron - Department of Finance

NyoNyo Aung Kyaw


Iona College


Journal of International Financial Management & Accounting, Vol. 20, Issue 1, pp. 1-34, Spring 2009

Abstract:     
This paper documents the impact of national transparency regimes on corporate capital structure in 14 European countries. After controlling for relevant firm, industry, and national variables, we find that owner-manager agency cost-reducing transparency such as higher levels of analysts following is associated with lower corporate debt levels. In contrast, transparency that reduces owner-creditor agency costs that helps creditors control business risks (and creditors-to-owners wealth transfers), such as disclosure timeliness, institutional trading activities, and enforcement of anti-insider trading laws, are associated with higher corporate debt levels. Among other transparency measures, levels of financial and governance disclosures are negatively associated with debt ratios and higher levels of audit intensity and accounting disclosures are positively associated with debt ratios. Further, transparency factors are more important for large firms and for firms in services and high technology.

Number of Pages in PDF File: 34

Accepted Paper Series





Date posted: December 18, 2008  

Suggested Citation

Aggarwal, Raj and Kyaw, NyoNyo Aung, International Variations in Transparency and Capital Structure: Evidence from European Firms. Journal of International Financial Management & Accounting, Vol. 20, Issue 1, pp. 1-34, Spring 2009. Available at SSRN: http://ssrn.com/abstract=1317931 or http://dx.doi.org/10.1111/j.1467-646X.2009.01025.x

Contact Information

Raj Aggarwal (Contact Author)
University of Akron - Department of Finance ( email )
Akron, OH 44325-4803
United States
330-972-2780 (Phone)
HOME PAGE: http://www.uakron.edu/colleges/cba/facultylist/a/aggarwal.php
NyoNyo Aung Kyaw
Iona College ( email )
715 North Avenue
New Rochelle, NY 10801
United States
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References:  39
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