IDEAS home Printed from https://ideas.repec.org/a/pch/abante/v7y2004i2p105-145.html
   My bibliography  Save this article

Estructura De Propiedad Y Oportunidades De Crecimiento Como Determinantes Del Endeudamiento De Las Empresas Chilenas

Author

Listed:
  • VALENTÍN AZOFRA PALENZUEA

    (Universidad de Valladolid, Departamento de Economía Financiera y Contabilidad.)

  • PAOLO SAONA HOFFMANN

    (Universidad de Valladolid, Departamento de Economía Financiera y Contabilidad y Universidad Austral de Chile, Facultad de Ciencias Económicas y Administrativas.)

  • ELEUTERIO VALLELADO GONZÁLEZ

    () (Universidad de Valladolid, Departamento de Economía Financiera y Contabilidad.)

Abstract

Our aim is to test if the leverage and the debt maturity of Chilean firms quoted in the stock market are related with their growth opportunities, their ownership structure and the environment in which they operate. We perform an empirical analysis over an unbalanced panel of 169 Chilean firms for the period 1990-2001. Chilean firms growth opportunities are financed with long term debt. However, when firms need external funds they finance their growth opportunities with short term debt. The high ownership concentration, characteristic of Chilean firms, along with the presence of growth opportunities favours debt financing. The largest firms and the more needed of external financing prefer longer maturities for their debt. Finally, our results indicate that the presence of internal capital markets within a group influences firms financing decisions, particularly in those firms within the group with financing deficit. Pecking order theory offers partial explanations of Chilean firms financing decisions.

Suggested Citation

  • Valentín Azofra Palenzuea & Paolo Saona Hoffmann & Eleuterio Vallelado González, 2004. "Estructura De Propiedad Y Oportunidades De Crecimiento Como Determinantes Del Endeudamiento De Las Empresas Chilenas," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 7(2), pages 105-145.
  • Handle: RePEc:pch:abante:v:7:y:2004:i:2:p:105-145
    as

    Download full text from publisher

    File URL: http://eacc10.puc.cl/files/ABT/Contenidos/Vol-7-N2/Azofra.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Alonso-Borrego, Cesar & Arellano, Manuel, 1999. "Symmetrically Normalized Instrumental-Variable Estimation Using Panel Data," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(1), pages 36-49, January.
    2. Cantillo, Miguel & Wright, Julian, 2000. "How Do Firms Choose Their Lenders? An Empirical Investigation," Review of Financial Studies, Society for Financial Studies, vol. 13(1), pages 155-189.
    3. Barclay, Michael J. & Marx, Leslie M. & Smith, Clifford Jr., 2003. "The joint determination of leverage and maturity," Journal of Corporate Finance, Elsevier, vol. 9(2), pages 149-167, March.
    4. Richard Blundell & Stephen Bond & Frank Windmeijer, 2000. "Estimation in dynamic panel data models: improving on the performance of the standard GMM estimator," IFS Working Papers W00/12, Institute for Fiscal Studies.
    5. Tadesse, Solomon, 2002. "Financial Architecture and Economic Performance: International Evidence," Journal of Financial Intermediation, Elsevier, vol. 11(4), pages 429-454, October.
    6. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, vol. 19(3), pages 321-340.
    7. Charles J. Hadlock & Christopher M. James, 2002. "Do Banks Provide Financial Slack?," Journal of Finance, American Finance Association, vol. 57(3), pages 1383-1419, June.
    8. Jensen, Michael C, 1986. "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, American Economic Association, vol. 76(2), pages 323-329, May.
    9. Nicolás Majluf & Nureya Abarca & Darío Rodríguez & Luis Arturo Fuentes, 1998. "Governance And Ownership Structure In Chilean Economic Groups," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 1(1), pages 111-139.
    10. Francisco Gallego Y. & Norman Loayza., 2000. "Financial Structure in Chile: Macroeconomic Developments and Microeconomic Effects," Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 3(2), pages 5-30, August.
    11. Levine, Ross, 2002. "Bank-Based or Market-Based Financial Systems: Which Is Better?," Journal of Financial Intermediation, Elsevier, vol. 11(4), pages 398-428, October.
    12. Barclay, Michael J & Smith, Clifford W, Jr, 1995. " The Maturity Structure of Corporate Debt," Journal of Finance, American Finance Association, vol. 50(2), pages 609-631, June.
    13. Lindenberg, Eric B & Ross, Stephen A, 1981. "Tobin's q Ratio and Industrial Organization," The Journal of Business, University of Chicago Press, vol. 54(1), pages 1-32, January.
    14. Stephen Bond, 2002. "Dynamic panel data models: a guide to microdata methods and practice," CeMMAP working papers CWP09/02, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    15. Francisco Sogorb- Mira & José Lopez- Gracia, 2003. "Pecking Order Versus Trade-Off: An Empirical Approach To The Small And Medium Enterprise Capital Structure," Working Papers. Serie EC 2003-09, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    16. Lucian Arye Bebchuk, 1999. "A Rent-Protection Theory of Corporate Ownership and Control," NBER Working Papers 7203, National Bureau of Economic Research, Inc.
    17. Shane A. Johnson, 2003. "Debt Maturity and the Effects of Growth Opportunities and Liquidity Risk on Leverage," Review of Financial Studies, Society for Financial Studies, vol. 16(1), pages 209-236.
    18. Fernando Lefort & Eduardo Walker, 2000. "The Effects Of Economic And Political Shocks On Corporate Governance Systems In Chile," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 2(2), pages 183-206.
    19. Barth, James R. & Caprio, Gerard Jr. & Levine, Ross, 2004. "Bank regulation and supervision: what works best?," Journal of Financial Intermediation, Elsevier, vol. 13(2), pages 205-248, April.
    20. repec:hrv:faseco:30747162 is not listed on IDEAS
    21. Laurence Booth, 2001. "Capital Structures in Developing Countries," Journal of Finance, American Finance Association, vol. 56(1), pages 87-130, February.
    22. Myers, Stewart C., 1984. "Capital structure puzzle," Working papers 1548-84., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    23. Carlin, Wendy & Mayer, Colin, 2003. "Finance, investment, and growth," Journal of Financial Economics, Elsevier, vol. 69(1), pages 191-226, July.
    24. Core, John E., 2001. "A review of the empirical disclosure literature: discussion," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 441-456, September.
    25. Armen Hovakimian & Tim Opler & Sheridan Titman, 2002. "The Capital Structure Choice: New Evidence For A Dynamic Tradeoff Model," Journal of Applied Corporate Finance, Morgan Stanley, vol. 15(1), pages 24-30.
    26. Beck, Thorsten & Demirguc-Kunt, Asli & Levine, Ross, 1999. "A new database on financial development and structure," Policy Research Working Paper Series 2146, The World Bank.
    27. Myers, Stewart C, 1984. " The Capital Structure Puzzle," Journal of Finance, American Finance Association, vol. 39(3), pages 575-592, July.
    28. Aivazian, Varouj A. & Ge, Ying & Qiu, Jiaping, 2005. "The impact of leverage on firm investment: Canadian evidence," Journal of Corporate Finance, Elsevier, vol. 11(1-2), pages 277-291, March.
    29. Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2002. "Funding growth in bank-based and market-based financial systems: evidence from firm-level data," Journal of Financial Economics, Elsevier, vol. 65(3), pages 337-363, September.
    30. Stewart C. Myers, 1984. "Capital Structure Puzzle," NBER Working Papers 1393, National Bureau of Economic Research, Inc.
    31. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, Oxford University Press, vol. 84(3), pages 488-500.
    32. Beck, Thorsten & Levine, Ross, 2002. "Industry growth and capital allocation:*1: does having a market- or bank-based system matter?," Journal of Financial Economics, Elsevier, vol. 64(2), pages 147-180, May.
    33. Shyam-Sunder, Lakshmi & C. Myers, Stewart, 1999. "Testing static tradeoff against pecking order models of capital structure," Journal of Financial Economics, Elsevier, vol. 51(2), pages 219-244, February.
    34. Rafael La Porta & Florencio Lopez-De-Silanes & Andrei Shleifer, 1999. "Corporate Ownership Around the World," Journal of Finance, American Finance Association, vol. 54(2), pages 471-517, April.
    35. Stohs, Mark Hoven & Mauer, David C, 1996. "The Determinants of Corporate Debt Maturity Structure," The Journal of Business, University of Chicago Press, vol. 69(3), pages 279-312, July.
    36. Johnson, Shane A., 1997. "An Empirical Analysis of the Determinants of Corporate Debt Ownership Structure," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 32(01), pages 47-69, March.
    37. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 2000. "Investor protection and corporate governance," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 3-27.
    38. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    39. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    40. Fernando Lefort & Eduardo Walker, 2000. "Ownership And Capital Structure Of Chilean Conglomerates:Facts And Hypotheses For Governance," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 3(1), pages 3-27.
    41. Harris, Richard D. F., 1997. "Stock markets and development: A re-assessment," European Economic Review, Elsevier, vol. 41(1), pages 139-146, January.
    42. Fernando Lefort & Eduardo Walker, 2000. "Corporate Governance: Challenges For Latin America," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 2(2), pages 99-111.
    43. Myers, Stewart C., 1977. "Determinants of corporate borrowing," Journal of Financial Economics, Elsevier, vol. 5(2), pages 147-175, November.
    44. Denis, David J. & Mihov, Vassil T., 2003. "The choice among bank debt, non-bank private debt, and public debt: evidence from new corporate borrowings," Journal of Financial Economics, Elsevier, vol. 70(1), pages 3-28, October.
    45. Fernando Lefort & Eduardo Walker, 2002. "Cambios Estructurales e Integración. Discusión y Análisis del Mercado Accionario Chileno," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 39(116), pages 95-122.
    46. Aydin Ozkan, 2002. "The determinants of corporate debt maturity: evidence from UK firms," Applied Financial Economics, Taylor & Francis Journals, vol. 12(1), pages 19-24.
    47. Fernando Lefort, 2003. "Gobierno Corporativo: ¿Qué es? y ¿Cómo andamos por casa?," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 40(120), pages 207-237.
    48. Houston, Joel & James, Christopher, 1996. " Bank Information Monopolies and the Mix of Private and Public Debt Claims," Journal of Finance, American Finance Association, vol. 51(5), pages 1863-1889, December.
    49. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
    50. Yosha Oved, 1995. "Information Disclosure Costs and the Choice of Financing Source," Journal of Financial Intermediation, Elsevier, vol. 4(1), pages 3-20, January.
    51. Simon Johnson & Andrei Shleifer, 2000. "Coase And Corporate Governance In Latin America," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 2(2), pages 113-131.
    52. Michael J. Barclay & Clifford W. Smith, 1996. "On Financial Architecture: Leverage, Maturity, And Priority," Journal of Applied Corporate Finance, Morgan Stanley, vol. 8(4), pages 4-17.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Pecking Order Theory; Ownership Structure; Growth Opportunities; Institutional Environment; Agency Problems; Chile;

    JEL classification:

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

    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:pch:abante:v:7:y:2004:i:2:p:105-145. 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: (Gimena Pardo). General contact details of provider: http://edirc.repec.org/data/eapuccl.html .

    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.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with 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.