arbiter
JournalsAccount

Capital structure and institutional status in the European Union

Alejandro Casino-Martínez et al.

Empirica2025https://doi.org/10.1007/s10663-025-09649-zarticle
AJG 1ABDC B
Weight
0.37

Abstract

This study analyses the financing of firms in the EU countries during the 2010–2018 period from the perspective of the potential influence of the institutional environment. Our model includes not only country-specific but also firm-level and macroeconomic factors. We find that a significant portion of the variation in firms´ leverage is explained by institutional factors, both legal and financial. Moreover, our results reveal that capital structure, in terms of leverage, has an inverse relationship with the distance to (institutional) frontier score, suggesting the existence of an institutional gap in the EU. Regarding the economic impact of the institutional effects, four institutional factors can be highlighted as the most relevant: (i) the level of financial development, (ii) the concentration of the banking system, (iii) the strength of the legal system or economic freedom, and (iv) the degree of financial intermediation.

1 citation

Open via your library →

Cite this paper

https://doi.org/https://doi.org/10.1007/s10663-025-09649-z

Or copy a formatted citation

@article{alejandro2025,
  title        = {{Capital structure and institutional status in the European Union}},
  author       = {Alejandro Casino-Martínez et al.},
  journal      = {Empirica},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.1007/s10663-025-09649-z},
}

Paste directly into BibTeX, Zotero, or your reference manager.

Flag this paper

Capital structure and institutional status in the European Union

Flags are reviewed by the Arbiter methodology team within 5 business days.

Evidence weight

0.37

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.16 × 0.4 = 0.06
M · momentum0.53 × 0.15 = 0.08
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.