IDEAS home Printed from https://ideas.repec.org/a/bla/jbfnac/v35y2008i3-4p491-515.html
   My bibliography  Save this article

Were Modern Capital Structure Theories Valid in Belgium Before World War I?

Author

Listed:
  • Marc Deloof
  • Wouter Van Overfelt

Abstract

This study investigates whether modern theories can explain capital structure in a historical environment which was characterized by poor investor protection, booming stock markets and strong banks, and in which taxes did not affect leverage. Our results, based on a unique, hand‐collected sample of 556 firm‐year observations for 129 listed companies in Belgium before World War I, are remarkably similar to findings for present‐day samples. Leverage was positively related to asset tangibility, firm size and firm age, and it was negatively related to profitability and prior stock returns. Bank relationships were associated with lower leverage.

Suggested Citation

  • Marc Deloof & Wouter Van Overfelt, 2008. "Were Modern Capital Structure Theories Valid in Belgium Before World War I?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 35(3‐4), pages 491-515, April.
  • Handle: RePEc:bla:jbfnac:v:35:y:2008:i:3-4:p:491-515
    DOI: 10.1111/j.1468-5957.2008.02080.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1468-5957.2008.02080.x
    Download Restriction: no

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gregg, Amanda & Nafziger, Steven, 2020. "Financing nascent industry : Leverage, politics, and performance in Imperial Russia," BOFIT Discussion Papers 7/2020, Bank of Finland, Institute for Economies in Transition.
    2. Amanda Gregg & Steven Nafziger, 2019. "Capital structure and corporate performance in late Imperial Russia," European Review of Economic History, Oxford University Press, vol. 23(4), pages 446-481.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jbfnac:v:35:y:2008:i:3-4:p:491-515. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley Content Delivery). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0306-686X .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.