Leverage of Non-financial Firms and Its Determinants in the Pre-pandemic and Pandemic Period—Some Evidence from CEE Countries

Peter Krištofík (), Hussam Musa () and Juraj Medzihorský ()
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Peter Krištofík: Faculty of Economics Matej Bel University in Banská Bystrica, Department of Finance and Accounting
Hussam Musa: Faculty of Economics Matej Bel University in Banská Bystrica, Department of Finance and Accounting
Juraj Medzihorský: Faculty of Economics Matej Bel University in Banská Bystrica, Department of Finance and Accounting

Chapter Chapter 53 in Advances in Empirical Economic Research, 2023, pp 857-869 from Springer

Abstract: Abstract Capital structure of firms, including its development during crises, has been widely discussed by economists. However, how has capital structure changed during the specific crisis related to the pandemic? Focusing on CEE, we confirmed that corporate leverage decreased significantly in 2020 in most of the examined countries. Regarding capital structure determinants, we confirmed significant negative correlations between leverage and profitability, cash, respectively, among the examined countries that support especially pecking-order theory. These associations were not affected by the pandemic, while, e.g., correlations of leverage and growth opportunities changed in the pre-pandemic period, as well as, in the pandemic period, depending on an examined country.

Keywords: Leverage; Capital structure; Crisis related to the pandemic; CEE countries (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-031-22749-3_53

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DOI: 10.1007/978-3-031-22749-3_53

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