In God We Trust: Religiosity, Religions, and Capital Structure Choice

52 Pages Posted: 13 Mar 2020

See all articles by Balbinder Singh Gill

Balbinder Singh Gill

Temple University - Fox School of Business and Management

Date Written: January 2020

Abstract

The empirical impact of religiosity on leverage is unclear. I provide causal evidence that this unclarity is due to lack of control for the concentration of religions with different views on the usage of corporate debt in previous studies. Utilizing a worldwide sample, I identify and verify the causal relationship using earthquake events that and its descriptive parameters as instruments for the endogenous religious variables. I find that the concentration of religions is able to completely reverse the positive impact of religiosity on leverage when the concentration of religions is greater than or equal to 50%.

Keywords: Capital structure, Religion, Religious concentration

JEL Classification: G32, Z12

Suggested Citation

Gill, Balbinder Singh, In God We Trust: Religiosity, Religions, and Capital Structure Choice (January 2020). Fox School of Business Research Paper Forthcoming, Available at SSRN: https://ssrn.com/abstract=3552929 or http://dx.doi.org/10.2139/ssrn.3552929

Balbinder Singh Gill (Contact Author)

Temple University - Fox School of Business and Management ( email )

Philadelphia, PA 19122
United States

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