Title | Internationalization and Zero Leverage |
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Type | Journal article |
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Authors | Sivaprasad, S., Chatzivgeri, E., Dontis-Charitos, P. and Williams, J. |
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Abstract | Despite growing attention on the role of internationalization in capital structure and the increasing adoption of zero-leverage policies by multinationals (MNC), no study examines the effect of internationalization on zero leverage. Using data from the United Kingdom (UK), we present the first empirical evidence of a positive and significant relationship that increases in the level of internationalization both statistically and economically. We find that the motivation for zero leverage differs between MNC and domestic firms (DOM). Whilst the major driving factor for MNC is the maintenance of financial flexibility, financial constraints motivate DOM. |
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Keywords | Capital structure |
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| Zero leverage |
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| Internationalization |
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| Multinational corporations |
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Journal | European Journal of Finance |
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Journal citation | 30 (11), pp. 1185-1211 |
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ISSN | 1351-847X |
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Year | 2024 |
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Publisher | Taylor & Francis |
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Publisher's version | License CC BY 4.0 File Access Level Open (open metadata and files) |
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Digital Object Identifier (DOI) | https://doi.org/10.1080/1351847x.2023.2277273 |
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Publication dates |
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Published online | 14 Nov 2023 |
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Published in print | 2024 |
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