Purpose -This paper aims to investigate the determinants of choice between private and public debt for British and German listed companies. Design/methodology/approach - The paper is based on three strands of theories: the “liquidation and renegotiation” hypothesis; the “moral hazard and...

Purpose – This paper aims to investigate the determinants of choice between private and public debt for British and German listed companies. Design/methodology/approach – The paper is based on three strands of theories: the “liquidation and renegotiation” hypothesis; the “moral hazard...

We compare the determinants of the corporate debt ownership structure in a bank-oriented economy (Germany) and market-oriented economy (UK). The results, that are controlled for endogeneity, simultaneity and measurement errors, show that the firms in both countries adjust their debt ownership...