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Market timing and corporate capital structure - A transatlantic comparison

Allard Bruinshoofd () and Leo de Haan ()

DNB Working Papers from Netherlands Central Bank, Research Department

Abstract: This paper conducts a transatlantic comparison of market timing effects on corporate capital structures, using some 45,000 observations on US, UK, and continental European firms. We confirm the empirical regularity that leverage and historical market-to-book ratios connect negatively in the US, but also document that this result does not extend to continental European and UK firms in general. The latter result is in line with the scarce empirical evidence for a few smaller European countries, and corroborates the enhanced' pecking order hypothesis of Högfeld and Oborenko (2005). The few market timing effects on European firms' capital structures that we find are specific to ICT firms and the ICT boom episode.

Keywords: Market Timing; Capital Structure; ICT. (search for similar items in EconPapers)
JEL-codes: C33 G3 (search for similar items in EconPapers)
Date: 2007-08
New Economics Papers: this item is included in nep-eec
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https://www.dnb.nl/binaries/Working%20Paper%20144-2007_tcm46-158499.pdf (application/pdf)

Related works:
Journal Article: Market timing and corporate capital structure: a transatlantic comparison (2012) Downloads
Working Paper: Market timing and corporate capital structure: a transatlantic comparison (2011) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:dnb:dnbwpp:144

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