High Debt Companies' Leverage Determinants in Spain: A Quantile Regression Approach

Posted: 21 Dec 2013

See all articles by Javier Sánchez Vidal

Javier Sánchez Vidal

Universidad Politecnica de Cartagena - Department of Economics, Accounting and Finance

Abstract

With a severe debt overhang problem in Spain, either public or private, the analysis of the factors that influence companies' leverage in this country reveals essential, in particular for the high-indebted firms. This study benefits from the quantile regression approach advantages over the OLS method to analyze the leverage determinants for a large sample of companies for the 2001-2011 period depending on their level of indebtedness. This method reveals that for the highly-leveraged companies many factors are no longer significant and that cash flow variable is crucial if the companies would like to decrease their debt levels.

Keywords: Quantile regressions; Capital structure; High-debt companies

JEL Classification: G32; C13

Suggested Citation

Sánchez Vidal, Javier, High Debt Companies' Leverage Determinants in Spain: A Quantile Regression Approach. Economic Modelling, Vol. 36, 2014, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2370326

Javier Sánchez Vidal (Contact Author)

Universidad Politecnica de Cartagena - Department of Economics, Accounting and Finance ( email )

Calle Real, 3
Cartagena, 30201
Spain

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