Social capital and leasing

Joshua Zhang, Hasibul Chowdhury, Jacquelyn E. Humphrey and Mostafa Monzur Hasan

Global Finance Journal, 2025, vol. 67, issue C

Abstract: We examine the relationship between social capital and corporate leasing intensity. Using a large sample of publicly traded US firms, we find that firms headquartered in areas with high social capital lease less. The negative association is driven by both the social norms and social network components of social capital. Our channel analysis reveals that social capital has both a direct and an indirect effect on leasing, with the direct effect being significantly stronger. The indirect effect is due to social capital reducing financing constraints.

Keywords: Social capital; Leasing; Financing constraints; Information asymmetry (search for similar items in EconPapers)
JEL-codes: G30 G32 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:glofin:v:67:y:2025:i:c:s1044028325001000

DOI: 10.1016/j.gfj.2025.101173

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