When opaque firms borrow: the role of investor sentiment
We examine the effect of firm opacity on debt growth and how investor sentiment shapes this relationship. Using an international sample of firms during 2005-2019, we find that firm opacity negatively influences the growth in both bank and total debt ratios. This relationship is more relevant during...
| Autores: | , |
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| Tipo de recurso: | artículo |
| Estado: | Versión publicada |
| Fecha de publicación: | 2025 |
| País: | España |
| Institución: | Universidad Pública de Navarra |
| Repositorio: | Academica-e. Repositorio Institucional de la Universidad Pública de Navarra |
| OAI Identifier: | oai:academica-e.unavarra.es:2454/55366 |
| Acceso en línea: | https://hdl.handle.net/2454/55366 |
| Access Level: | acceso abierto |
| Palabra clave: | Bank debt growth Corporate opacity Internal and external mechanisms Total debt growth Investor sentiment |
| Sumario: | We examine the effect of firm opacity on debt growth and how investor sentiment shapes this relationship. Using an international sample of firms during 2005-2019, we find that firm opacity negatively influences the growth in both bank and total debt ratios. This relationship is more relevant during periods of high investor sentiment. The role of investor sentiment is more prominent for firms with a lower proportion of bank ownership. The joint effect of firm opacity and investor sentiment is more relevant in countries with more developed institutions and greater creditor rights protection. Our results hold after addressing potential endogeneity concerns and additional tests. |
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