Does export intensity of heterogeneous firms affect leverage? Evidence from a small open economy

• Ramzan, Imran ^[1] ; Gebizlioglu, Ömer Lütfi
  1. [1] DR
• Localización: Economics and Business Letters, ISSN-e 2254-4380, Vol. 12, Nº. 4, 2023, págs. 356-365
• Idioma: inglés
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• Resumen

  • Exports at firm level improve the financial performance and thereby contribute to economic growth. Exporting activities require additional financing and become a challenge to manufacturing firms, thus affecting managerial financing decisions. This study explores the impact of export intensity on leverage by using a dataset of manufacturing firms. The results of two-step system GMM reveal that export intensity negatively influences the leverage. We find that a firm’s size positively impacts the leverage, while cash holding has a negative connection with leverage. Finally, we note that board size exhibits a positive relationship to leverage. These findings suggest important policy implications for export promotion, specifically for a small open economy. The results are robust to different sensitivity checks.