How SME Uniqueness Affects Capital Structure: Evidence From a 1994-1998 Spanish Data Panel
Universidad CEU Cardenal Herrera - Department of Business and Economics
The principal aim of this paper is to test how firm characteristics affect Small and Medium Enterprise (SME) capital structure. We carry out an empirical analysis of panel data of 6482 non-financial Spanish SMEs during the five year period 1994-1998, modelling the leverage ratio as a function of firm specific attributes hypothesized by capital structure theory. Our results suggest that non-debt tax shields and profitability are both negatively related to SME leverage, while size, growth options and asset structure influence positively SME capital structure; they also confirm a maturity matching behaviour in this firm group.
Number of Pages in PDF File: 25
Keywords: Financing, Capital Structure, Trade-Off Theory, Pecking Order Theory, SME, Panel Data
JEL Classification: C23, G32, G33.working papers series
Date posted: May 5, 2003
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