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The Impact of the Euro Crisis on Corporate Capital Sources in France, Germany, Switzerland and the United Kingdom

This study investigates the effect of the European sovereign debt crisis on alternative capital sources of public companies from France, Germany, Switzerland and the United Kingdom. Specifically, it studies which financing choices expose a company to potential bank lending and demand shocks during the Euro crisis. To this end, the study employs average treatment effect estimations and difference-in-differences regressions to show whether financially more (less) constrained companies use more (less) alternative capital than matching control companies. I find that two of three financially more constrained company groups show higher use of alternative capital sources than matched companies due to evidence for bank lending shocks in Germany and France. Companies with a high financial dependence behave against the expectation because of high cash holdings and lower need for alternative capital. Companies with high cash holdings showed signs of a demand shock. Swiss and British companies appear to be much less affected by the Euro crisis because of weaker financial ties with the most affected southern Eurozone economies.

Identiferoai:union.ndltd.org:UPSALLA1/oai:DiVA.org:uu-277259
Date January 2016
CreatorsSchmidt, Florian
PublisherUppsala universitet, Företagsekonomiska institutionen
Source SetsDiVA Archive at Upsalla University
LanguageEnglish
Detected LanguageEnglish
TypeStudent thesis, info:eu-repo/semantics/bachelorThesis, text
Formatapplication/pdf
Rightsinfo:eu-repo/semantics/openAccess

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