State ownership and corporate leverage around the world

Ralph De Haas, Sergei Guriev and Alexander Stepanov

Journal of Corporate Finance, 2025, vol. 93, issue C

Abstract: Does state ownership hinder or help firms access credit? We use data on almost 4 million firms in 89 countries to study the relationship between state ownership and corporate leverage. Controlling for country-sector-year fixed effects and conventional firm-level determinants of leverage, we show that state ownership is robustly and negatively related to corporate leverage. This relationship holds across most of the firm-size distribution – with the important exception of the largest companies – and is stronger in countries with weak political and legal institutions. A panel data analysis of privatized firms and a comparison of privatized with matched control firms yield similar qualitative and quantitative effects of state ownership on leverage.

Keywords: State ownership; Privatization; Corporate debt; State banks (search for similar items in EconPapers)
JEL-codes: D22 F36 G32 G38 H11 H81 L33 (search for similar items in EconPapers)
Date: 2025
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Related works:
Working Paper: State Ownership and Corporate Leverage Around the World (2022)
Working Paper: State Ownership and Corporate Leverage Around the World (2022)
Working Paper: State Ownership and Corporate Leverage Around the World (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:93:y:2025:i:c:s0929119925000501

DOI: 10.1016/j.jcorpfin.2025.102782

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