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Is There a Size Gap in Corporate Leverage?. A European Comparison / Gibt es eine Kluft im Leverage europäischer Unternehmen?. Ein europäischer Vergleich

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  • Coeurderoy Régis

    (Assistant professor in Business Policy School of Management, Université Catholique de Louvain, Place de Doyens, 1, B-1348 Louvain-la-Neuve, Belgium)

Abstract

The main purpose of this paper is to evaluate corporate debt ratios by size classes in Continental Europe. Evidence is given on a sample of firms in manufacturing industry for ten European countries, all of them being in Euroland apart from Denmark (Austria, Belgium, Denmark, Finland, France, Germany, Italy, Netherlands, Portugal and Spain). The descriptive analysis shows a 15 % point size gap in corporate leverage between small and large companies on average. Even after adjusting for structural factors, the size gap remains at 10 %. Yet, an overall assessment should not lead us to overlook national features when comparing small and large companies. In particular, three main groups emerge: in Germanic countries (Austria and Germany), the gap is the largest, mainly because of regulatory specificities. In a second cluster, companies from Denmark, France and Portugal exhibit significant differences in averages across sizes but at a lower extent than in the first group. As regards the other countries, even though the size gap is still the dominant pattern, the situation is less definite and deserves case by case analysis.

Suggested Citation

  • Coeurderoy Régis, 2001. "Is There a Size Gap in Corporate Leverage?. A European Comparison / Gibt es eine Kluft im Leverage europäischer Unternehmen?. Ein europäischer Vergleich," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 221(5-6), pages 672-688, October.
    • Handle: RePEc:jns:jbstat:v:221:y:2001:i:5-6:p:672-688
    DOI: 10.1515/jbnst-2001-5-612
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    References listed on IDEAS

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    Cited by:

    1. Jacques-Bernard Sauner-Leroy, 2003. "The impact of the implementation of the Single Market Programme on productive efficiency and on mark-ups in the European Union manufacturing industry," European Economy - Economic Papers 2008 - 2015 192, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.

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