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Capital Structure and Religion. Some International Evidence


  • Ingrid-Mihaela Dragotă

    () (Bucharest University of Economic Studies, Department of Finance, Bucharest, Romania)

  • Victor Dragotă

    () (Bucharest University of Economic Studies, Department of Finance and Center of Financial and Monetary Research (CEFIMO), Bucharest, Romania)

  • Andreea Curmei-Semenescu

    () (Bucharest University of Economic Studies, Department of Finance and Center of Financial and Monetary Research (CEFIMO), Bucharest, Romania)

  • Daniel Traian Pele

    () (Bucharest University of Economic Studies, Department of Statistics and Econometrics, Bucharest, Romania)


In the recent years, an increasing number of papers deepened cross-disciplinary studies, examining how different cultural values infl uence financial variables. The main objective of our paper is to test if the dominant world religions (Buddhist, Christian, Hindu, Islamic, and Judaic), and, moreover, some Christian denominations (Catholicism, Protestantism and Eastern Orthodox Christianity) are related to some patterns in capital structure. Our paper considers distinctly the category of countries in which Agnostics, Atheists and non-religious people are predominant. The results are promising. Companies located in the states with predominance of Islamic religion have a lower leverage, while the ones from predominantly Catholic, Eastern Orthodox, Hindu and Judaic countries, as well as those in mainly Agnostic, Atheist and non-religious ones, are indebted more than those from mainly Protestant countries. The debt maturity seems to be correlated to the dominant religions or denominations, with companies in the predominantly Eastern Orthodox, Buddhist and Agnostic, Atheist and non-religious countries relying more on short term debt, and those in the majority Catholic, Judaic and Hindu countries on long term debt.

Suggested Citation

  • Ingrid-Mihaela Dragotă & Victor Dragotă & Andreea Curmei-Semenescu & Daniel Traian Pele, 2018. "Capital Structure and Religion. Some International Evidence," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 68(3), pages 415-442, September.
  • Handle: RePEc:aka:aoecon:v:68:y:2018:i:3:p:415-442
    Note: This work was partially supported by the Executive Agency for Higher Education, Research, Development and Innovation Funding (UEFISCDI), project number AT code 86/2007, and cofinanced by the Center of Financial and Monetary Research (CEFIMO). The authors wish to thank for the useful comments received on preliminary drafts of this paper to the participants to the EWGFM Conference in Stockholm (2008), EMQFB Conference in Tîrgu-Mureş (2013), FWPO Conference in Cluj-Napoca (2013) and EWGCFM Conference in Vienna (2013). The remaining errors are ours. The authors benefited also from the useful remarks provided by Elena Dumitrescu, Claudiu Herţeliu and Hanaan Yaseen.

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    1. repec:rfb:journl:v:10:y:2018:i:2:p:077-094 is not listed on IDEAS
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    More about this item


    capital structure; culture; religion; firm-specific factors; country-specific factors;

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • Z12 - Other Special Topics - - Cultural Economics - - - Religion
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification


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