State Ownership and Corporate Leverage Around the World

Ralph de Haas (1) , Sergei Guriev (2, 1) , Alexander Stepanov

1 CEPR - Center for Economic Policy Research
2 ECON - Département d'économie (Sciences Po)

Does state ownership hinder or help rms access credit? We use data on almost 4 million rms in 89 countries to study the relationship between state ownership and corporate leverage. Controlling for country-sector-year xed eects and conventional rm-level determinants of leverage, we show that state ownership is robustly and negatively related to corporate leverage. This relationship holds across most of the rm-size distributionwith the important exception of the largest companiesand is stronger in countries with weak political and legal institutions. A panel data analysis of privatized rms and a comparison of privatized with matched control rms yield similar qualitative and quantitative eects of state ownership on leverage.

Keywords: State ownership privatization corporate debt state banks; State ownership; privatization; corporate debt; state banks

Domains: Humanities and Social Sciences; Economics and Finance

Ralph de Haas, Sergei Guriev, Alexander Stepanov. State Ownership and Corporate Leverage Around the World. 2022. ⟨hal-03878686⟩