The effect of debt on corporate profitability Evidence from French service sector

Mazen Kebewar and Ahmed Shah Syed Muhammad Noaman ()
Additional contact information
Mazen Kebewar: LEO - Laboratoire d'Économie d'Orleans [UMR7322] - UO - Université d'Orléans - UT - Université de Tours - CNRS - Centre National de la Recherche Scientifique
Ahmed Shah Syed Muhammad Noaman: LEO - Laboratoire d'Économie d'Orleans [UMR7322] - UO - Université d'Orléans - UT - Université de Tours - CNRS - Centre National de la Recherche Scientifique

Working Papers from HAL

Abstract: Current study aims to provide new empirical evidence on the impact of debt on corporate profitability. This impact can be explained by three essential theories: signaling theory, tax theory and the agency cost theory. Using panel data sample of 2240 French non listed companies of service sector during 1999-2006. By utilizing generalized method of moments (GMM) econometric technique on three measures of profitability ratio (PROF1, PROF2 and ROA), we show that debt ratio has no effect on corporate profitability, regardless of the size of company (VSEs, SMEs or LEs).

Keywords: Endettement; données de panel; profitabilité.; Profitability; Debt; GMM; Panel data; Profitability. (search for similar items in EconPapers)
Date: 2013-03-05
New Economics Papers: this item is included in nep-acc
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00825178
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://shs.hal.science/halshs-00825178/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:halshs-00825178

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().