IDEAS home Printed from https://ideas.repec.org/a/taf/oaefxx/v7y2019i1p1587804.html
   My bibliography  Save this article

Stock liquidity and capital structure: International evidence

Author

Listed:
  • Tung Lam Dang
  • Hai Ly Ho
  • Chi Dzung Lam
  • Thanh Thao Tran
  • Xuan Vinh Vo

Abstract

Relying on the assumption that equity market provides useful information for firm decision, this study examines the effect of stock liquidity on corporate capital structure decision. We also analyze whether this effect varies according to country-level institutional environments. Using a comprehensive international dataset of 19,939 firms across 41 countries over 2000–2010, the paper offers two key findings. First, firms with higher stock market liquidity tend to have lower leverage. Second, countries with strong institutional environments are more likely to have a weaker (negative) relationship between stock market liquidity and leverage. These results are robust to different liquidity measurement and subsamples.

Suggested Citation

  • Tung Lam Dang & Hai Ly Ho & Chi Dzung Lam & Thanh Thao Tran & Xuan Vinh Vo, 2019. "Stock liquidity and capital structure: International evidence," Cogent Economics & Finance, Taylor & Francis Journals, vol. 7(1), pages 1587804-158, January.
    • Handle: RePEc:taf:oaefxx:v:7:y:2019:i:1:p:1587804
    DOI: 10.1080/23322039.2019.1587804
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23322039.2019.1587804
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23322039.2019.1587804?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Thi Hien Nguyen, 2020. "Impact of Bank Capital Adequacy on Bank Profitability under Basel II Accord: Evidence from Vietnam," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 45(1), pages 31-46, March.
    2. He, Xiqiong & Gu, Xiang & Liu, Hao, 2023. "Stock liquidity and controlling shareholders' encroachment of private interests: Evidence from China," Finance Research Letters, Elsevier, vol. 56(C).
    3. Thi Phuong Vy Le and Xuan Vinh Vo, 2020. "Financing Decision and Labor Cost: Evidence from South Asian Countries," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 45(1), pages 185-201, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oaefxx:v:7:y:2019:i:1:p:1587804. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/OAEF20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.