Small Business Economics

, Volume 25, Issue 5, pp 447–457

How SME Uniqueness Affects Capital Structure: Evidence From A 1994–1998 Spanish Data Panel



The principal aim of this paper is to test how firm characteristics affect Small and Medium Enterprise (SME) capital structure. We carry out an empirical analysis of panel data of 6482 non-financial Spanish SMEs during the five years period 1994–1998, modelling the leverage ratio as a function of firm specific attributes hypothesized by capital structure theory. Our results suggest that non-debt tax shields and profitability are both negatively related to SME leverage, while size, growth options and asset structure influence positively SME capital structure; they also confirm a maturity matching behaviour in this firm group.


capital structure financing panel data pecking order theory SME trade-off theory 

Jel Classification

C23 G32 G33 


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Copyright information

© Springer 2005

Authors and Affiliations

  1. 1.Department of Business and EconomicsUniversity Cardenal Herrera-CEUElche (Alicante)Spain

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