 The phenomenon of zero-leverage policy: Literature reviewPaolo Saona, Laura Muro and Andros Gregoriou Research in International Business and Finance, 2023, vol. 66, issue C Abstract: One of the most puzzling, stylized facts in modern corporate finance is that many companies worldwide persistently follow a zero-debt or almost-zero-debt policy. This paper reviews the literature on this puzzling policy. We survey articles published in the Web of Science and the SCOPUS databases since the zero-debt policy was first formally discussed in 1990 when zero-levered companies started to emerge. Our literature review provides unique conceptual and methodological knowledge contributions, by critically analyzing prior works and paving the way for the advancement of new paradigms. It traces the evolution of knowledge in the field of capital structure by establishing connections among various literature works, creating a cohesive and integrated understanding of the zero-debt puzzle. It offers insights from different perspectives presented in each study, thereby enhancing comprehension. Moreover, it critically questions existing theories' adequacy in explaining the reasons behind a significant number of global corporations opting to avoid debt. Keywords: Zero leverage; Literature review; Capital structure; All-equity firms; Debt policy (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:66:y:2023:i:c:s0275531923001381 DOI: 10.1016/j.ribaf.2023.102012 Access Statistics for this article Research in International Business and Finance is currently edited by T. Lagoarde Segot More articles in Research in International Business and Finance from Elsevier |
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