Resource title

Taxation and capital structure choice: evidence from a panel of German multinationals

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Resource description

This paper analyzes the impact of taxes and lending conditions on the financial structure of multinationals' foreign affiliates. The empirical analysis employs a large panel of affiliates of German multinationals in 26 countries in the period from 1996 until 2003. In accordance with the theoretical predictions, the effect of local taxes on leverage is positive for both types of debt. Moreover, while adverse local credit market conditions are found to reduce external borrowing, internal debt is increasing, supporting the view that the two channels of debt finance are substitutes.

Resource author

Thiess Buettner, Michael Overesch, Ulrich Schreiber, Georg Wamser

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/25886

Resource license

Adapt according to the presented license agreement and reference the original author.