Title
Excess leverage and productivity growth in emerging economies : is there a threshold effect?
Description
This paper studies the relationship between leverage and growth, focusing on a large sample of firms in emerging economies of central and eastern Europe (CEE). Contrary to the general wisdom, we find that deviation from optimal leverage, especially excess leverage, is common among firms in many CEE countries. Using firm-level panel data, the paper provides support to the hypothesis that leverage positively affects productivity growth but only below an endogenously determined threshold level.
URL
http://www.cepr.org/pubs/new-dps/dplist.asp?dpno=7617
URL Description
Abstract
Language
English
Author
Fabrizio Coricelli
Author
Isabelle Roland
Author
Sarmistha Pal
Author
Nigel Driffield

economics; excess leverage; TFP growth; threshold model

Is this item peer reviewed?
No
ISBN
1898128189
Publisher
CEPR
Date of publication
01 January 2009
Place of publication
London
Series title
CEPR discussion paper