Skip to main content
Disciplines
Automotive Business IT + Informatics Construction + Real Estate Electrical Engineering + Electronics Energy + Sustainability Insurance + Risk Finance + Banking Management + Leadership Marketing + Sales Mechanical Engineering + Materials
Events
DE
EN
Books
Journals
Topic Page
Marketing
Start single access now
Access for companies
EXTENDED SEARCH
Log in
Top
Published in:
Introduction to “Family Businesses in the Arab World” Read chapter Read first chapter

2017 | OriginalPaper | Chapter

Impact of Institutional Environment on the Capital Structure of Tunisian Family Firms

Authors : Fayrouz Bencheikh, Faten Chibani

Published in: Family Businesses in the Arab World

Publisher: Springer International Publishing

Log in

Activate our intelligent search to find suitable subject content or patents.

search-config
loading …

Abstract

The aim of the chapter is to analyse the effect of the institutional environment on the financing of Tunisian family firms. Two factors are considered. The first consists of the regulation of investments and the economic initiative. The second considers the level of corruption. This effect is highlighted using a sample of 41 listed and unlisted Tunisian family firms over the period 2007–2012.
The results show that regulated sectors are negatively associated with debt access. This is further confirmed in the post- and prior revolution periods for family firms. The corruption index does not give significant results, although the negative coefficients demonstrate reluctance regarding debt. On the other hand, the ownership structure adopted by family CEOs and institutional investors improves debt. A possible explanation for the paradox is that the advantages taken from regulation substitute the debt requirement. In the other case, the relational advantage prevails.

Dont have a licence yet? Then find out more about our products and how to get one now:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

  • über 102.000 Bücher
  • über 537 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Maschinenbau + Werkstoffe
  • Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

inform now

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 340 Zeitschriften

aus folgenden Fachgebieten:

  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Versicherung + Risiko




Jetzt Wissensvorsprung sichern!

inform now
previous chapter Financial Behaviour of Lebanese Family Firms During Political Crises
next chapter How Can Family Firms Attract Foreign Investors? The Role of Governance Mechanisms in Tunisia
Footnotes
1
Before the 2011 Tunisian revolution, the former President Ben Ali’s family and his allies owned and controlled a considerable portion of Tunisian listed and unlisted firms in various industries.
 
2
The national statistics are produced by the National Institute of Statistics (INS).
 
3
This is due to the limited measure, which did not record large fluctuations during the study period.
 
Literature
Almazan, A., Hartzell, J. C., & Starks, L. T. (2005). Active institutional shareholders and costs of monitoring: Evidence from executive compensation. Financial Management, 34, 5–34.CrossRef
Ampenberger, M., Schmid, T., Achleitner, A.-K., & Kaserer, C. (2013). Capital structure decisions in family firms: Empirical evidence from a bank-based economy. Review of Managerial Science, 7, 247–275.CrossRef
Anderson, R. C., Mansi, S. A., & Reeb, D. M. (2003). Founding family ownership and the agency cost of debt. Journal of Financial economics, 68, 263–285.CrossRef
Antoniou, A., Guney, Y., & Paudyal, K. (2008). The determinants of capital structure: Capital market-oriented versus bank-oriented institutions. Journal of Financial and Quantitative Analysis, 43, 59–92.CrossRef
Bennett, J. A., Sias, R. W., & Starks, L. T. (2003). Greener pastures and the impact of dynamic institutional preferences. Review of Financial Studies, 16, 1203–1238.CrossRef
Bertrand, M., Paras, M., & Sendhil, M. (2002). Ferreting out tunnelling: An application to Indian business groups. Quarterly Journal of Economics, 117, 1047–1073.
Bessler, W., Drobetz, W., & Grüninger, M. C. (2011). Information asymmetry and financing decisions. International Review of Finance, 11, 123–154.CrossRef
Bhaumik, S. K., & Gregoriou, A. (2010). Family ownership, tunneling and earnings management: A review of the literature. Journal of Economic Surveys, 24, 705–730.CrossRef
Bortolotti, B., & Faccio, M. (2009). Government control of privatized firms. Review of Financial Studies, 22, 2907–2939.CrossRef
Boubakri, N., & Cosset, J.-C. (1998). The financial and operating performance of newly privatized firms: Evidence from developing countries. The Journal of Finance, 53, 1081–1110.CrossRef
Boubakri, N., Cosset, J.-C., & Guedhami, O. (2004). Privatization, corporate governance and economic environment: Firm-level evidence from Asia. Pacific-Basin Finance Journal, 12, 65–90.CrossRef
Céspedes, J., González, M., & Molina, C. A. (2010). Ownership and capital structure in Latin America. Journal of Business Research, 63, 248–254.CrossRef
Chan, C. C., Chang, Y. H., & Liao, W. C. (2013). Does bank relationship matter for corporate risk-taking? Evidence from listed firms in Taiwan. North American Journal of Economics and Finance, 26, 323–338.CrossRef
Chung, C. Y., & Wang, K. (2014). Do institutional investors monitor management? Evidence from the relationship between institutional ownership and capital structure. North American Journal of Economics and Finance, 30(C), 203–233.CrossRef
Chung, K. H., & Zhang, H. (2011). Corporate governance and institutional ownership. Journal of Financial and Quantitative Analysis, 46, 247–273.CrossRef
Cromie, S., Stephenson, B., & Monteith, D. (1995). The management of family firms: An empirical investigation. International Small Business Journal, 13(4), 11–34.CrossRef
Dasgupta, S., & Nanda, V. (1993). Bargaining and brinkmanship: Capital structure choice by regulated firms. International Journal of Industrial Organization, 11, 475–497.CrossRef
Degryse, H., de Goeij, P., & Kappert, P. (2012). The impact of firm and industry characteristics on small firms’ capital structure. Small Business Economics, 38, 431–447.CrossRef
Faccio, M., & Lang, L. H. (2002). The ultimate ownership of Western European corporations. Journal of Financial Economics, 65(3), 365–395.CrossRef
Fama, E. F., & Jensen, M. C. (1983). Separation of ownership and control. Journal of Law and Economics, 26, 301–325.CrossRef
Faulkender, M., & Petersen, M. A. (2006). Does the source of capital affect capital structure? Review of Financial Studies, 19, 45–79.CrossRef
Ferreira, M. A., Massa, M., & Matos, P. (2010). Shareholders at the gate: Institutional investors and cross-border mergers and acquisitions. Review of Financial Studies, 23, 301–644.CrossRef
Gao, L., & Kling, G. (2008). Corporate governance and tunneling in China. Pacific-Basin Finance Journal, 16, 591–605.CrossRef
Gomez-Mejia, L. R., Haynes, K., Nuñez-Nickel, M., Jacobson, K. J. L., & Moyano-Fuentes, J. (2007). Socioemotional wealth and business risks in family-controlled firms: Evidence from Spanish olive oil mills. Administrative Science Quarterly, 52, 106–137.CrossRef
González, M., Guzmán, A., Pombo, C., & Trujillo, M.-A. (2013). Family firms and debt: Risk aversion versus risk of losing control. Journal of Business Research, 66, 2308–2320.CrossRef
Graham, J. R., Leary, M. T., & Roberts, M. R. (2015, December). A century of capital structure: The leveraging of corporate America. Journal of Financial Economics, 118(3), 658–683.CrossRef
Grinstein, Y., & Michaely, R. (2005). Institutional holdings and pay-out policy. The Journal of Finance, 60, 1389–1426.CrossRef
Hartzell, J. C., & Starks, L. T. (2003). Institutional investors and executive compensation. The Journal of Finance, 58, 2351–2374.CrossRef
Heshmati, A. (2002). Quality adjusted measures of services in public schools. European Journal of Operational Research, 136, 655–670.CrossRef
Kennedy, P. (1998). A Guide to Econometrics. Oxford: Blackwell.
Koropp, C., Grichnik, D., & Kellermanns, F. (2013). Financial attitudes in family firms: The moderating role of family commitment. Journal of Small Business Management, 51, 114–137.CrossRef
Koropp, C., Kellermanns, F. W., Grichnik, D., & Stanley, L. (2014). Financial decision making in family firms: An adaptation of the theory of planned behaviour. Family Business Review, 27(4), 307–327.CrossRef
Kremp, É., & Stöss, E. (2001). L’endettement des entreprises industrielles françaises et allemandes: Des évolutions distinctes malgré des déterminants proches. Économie et Statistique, 341, 153–171.CrossRef
La Porta, R., Lopez-de Silanes, F., & Shleifer, A. (1999). Corporate ownership around the world. Journal of Finance, 54(2), 471–517.CrossRef
Leary, M. (2009). Bank loan supply, lender choice, and corporate capital structure. Journal of Finance, 64, 1143–1185.CrossRef
López-Gracia, J., & Sogorb-Mira, F. (2008). Testing trade-off and pecking order theories financing SMEs. Small Business Economics, 31, 117–136.CrossRef
Miller, D., & Breton-Miller, L. (2006). Family governance and firm performance: Agency, stewardship, and capabilities. Family Business Review, 19, 73–87.CrossRef
Myers, S. C. (1977). Determinants of corporate borrowing. Journal of Financial Economics, 5, 147–175.CrossRef
Myers, S. C., & Majluf, N. S. (1984). Corporate financing and investment decisions when firms have information that investors do not have. Journal of Financial Economics, 13, 187–221.CrossRef
Parrino, R., Sias, R. W., & Starks, L. T. (2003). Voting with their feet: Institutional ownership changes around forced CEO turnover. Journal of Financial Economics, 68, 3–46.CrossRef
Rajan, R. G., & Zingales, L. (1995). What do we know about capital structure? Some evidence from international data. The Journal of Finance, 50, 1421–1460.CrossRef
Ramalho, J., & Da-Silva, J. V. (2009). A two-part fractional regression model for the financial leverage decisions of micro, small, medium and large firms. Quantitative Finance, 9(5), 621–636.CrossRef
Reynolds, P.D. (1995). Family firms in the start-up process: Preliminary explorations. Paper presented at the 1995 Annual Meeting of the International Family Business Program Association, Nashville, Tennessee, US
Rodrik, D. (1996). Understanding economic policy reform. Journal of Economic Literature, XXXIV, 9–41.
Romano, C. A., Tanewski, G. A., & Smyrnios, K. X. (2001). Capital structure decision making: A model for family business. Journal of Business Venturing, 16, 285–310.CrossRef
Serrasqueiro, A., Nunes, P. M., & Da-Silva, J. V. (2012). Are financing decisions of family-owned SMEs different? Empirical evidence using panel data. Journal of Management & Organization, 18, 363–382.CrossRef
Serrasqueiro, Z. S., Armada, M. R., & Nunes, P. M. (2011). Pecking order theory versus trade-off theory: Are service SMEs’ capital structure decisions different? Service Business, 5, 381–409.CrossRef
Shleifer, A., & Vishny, R. W. (1993). Corruption. The Quarterly Journal of Economics, 108(3), 599–617.CrossRef
Shleifer, A., & Vishny, R. W. (1994). Politicians and firms. Quarterly Journal of Economics, 194(4), 995–1025.CrossRef
Smyrnios, K., & Romano, C. (1994). The Price Waterhouse/Commonwealth Bank family business survey 1994. Sydney: Department of Accounting, Monash University.
Spiegel, Y. (1997). The choice of technology and capital structure under rate regulation. International Journal of Industrial Organization, 15, 191–216.CrossRef
Spiegel, Y., & Spulber, D. F. (1994). The capital structure of a regulated firm. The Rand Journal of Economics, 25(3), 424–440.CrossRef
Taggart, R. A. (1981). Rate-of-Return regulation and utility capital structure decisions. The Journal of Finance, 36, 383–393.
Taggart, R. A. (1985). Effects of regulation on utility financing: Theory and evidence. The Journal of Industrial Economics, 33(3), 257–276.CrossRef
Tai, V. W., Lai, Y.-H., & Lin, L. (2014). Local institutional shareholders and corporate hedging policies. The North American Journal of Economics and Finance, 28, 287–312.CrossRef
Titman, S., & Wessels, R. (1988). The determinants of capital structure choice. The Journal of Finance, 43, 1–19.CrossRef
Vieira, E. S. (2013). Capital structure determinants in the context of family firms. Proceedings in ARSA-Advanced Research in Scientific Areas., 2(1), 219–228.
Villalonga, B., & Amit, R. (2006). How do family ownership, control and management affect firm value? Journal of Financial Economics, 80, 385–417.CrossRef
Word Bank. (2014). The unfinished revolution: Bringing opportunity, good jobs and greater wealth to all Tunisians. Washington, DC.
Metadata
Title
Impact of Institutional Environment on the Capital Structure of Tunisian Family Firms
Authors
Fayrouz Bencheikh
Faten Chibani
Copyright Year
2017
Book
Family Businesses in the Arab World

Print ISBN: 978-3-319-57629-9

Electronic ISBN: 978-3-319-57630-5

Copyright Year: 2017

DOI
https://doi.org/10.1007/978-3-319-57630-5_9