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The impact of family ownership status on determinants of leverage. Empirical evidence from South East Asia

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  • Nhung Hong LE

    (International University, Vietnam National University & LaRGE Research Center, Université de Strasbourg)

Abstract

We investigate the impact of family ownership on determinants of leverage in South East Asia. We find that family firms use more debt than non-family firms and that family ownership strengthens the positive relationship between firm size and leverage. Family firms have a higher level of tangibility at a certain level of debt relative to non-family firms. On one hand, family firms with family CEOs use more debt to finance internal fund deficit relative to family firms with CEOs from outside or non-family firms. On the other hand, family firms with family CEOs have a lower level of debt corresponding to growth opportunities than others. Our results are robust to alternative estimation techniques and measurement of leverage. These findings contribute to understanding the determinants of leverage among family-controlled firms in South East Asia.

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  • Nhung Hong LE, 2017. "The impact of family ownership status on determinants of leverage. Empirical evidence from South East Asia," Working Papers of LaRGE Research Center 2017-09, Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg.
    • Handle: RePEc:lar:wpaper:2017-09
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    Keywords

    Family firms; capital structure; South East Asia.;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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