Purpose

This paper contributes to the capital structure literature by examining the impact of financial leverage on firm performance and also the extent to which firm size and crisis matter in the leverage -performance relationship.

Design/methodology/approach

Using data from 2403 Indian firms during the period 1995–2014, generating a total of 19,544 firm-year observations, panel econometric methods are employed to test the leverage-performance relationship.

Findings

Drawing insights from agency theory and using Tobin's Q (TQ) as our main measure of performance, the authors uncover that financial leverage is negatively and significantly related to firm performance. The authors also observe that the impact of financial leverage on firm performance is lower for smaller firms than larger ones. Finally, the authors show that the 2007/08 financial crisis had no significant impact on the relationship between financial leverage and firm performance.

Originality/value

The paper provides fresh evidence on the impact of leverage on performance, particularly from the Indian context. This study is also among the first studies to examine the role of firm size and financial crisis in the leverage-performance relationship.

中文翻译：

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杠杆与绩效：规模与危机关系重大吗？

目的

本文通过研究财务杠杆对企业绩效的影响以及企业规模和危机在杠杆绩效关系中的影响程度，为资本结构文献做出了贡献。

设计/方法/方法

利用1995年至2014年期间来自2403家印度公司的数据，共产生了19,544家公司年的观察结果，采用面板计量经济方法来测试杠杆与绩效之间的关系。

发现

作者从代理理论中获得见识，并使用托宾Q（TQ）作为我们主要的绩效指标，作者发现财务杠杆与公司绩效负相关且显着相关。作者还观察到，财务杠杆对小企业的影响要小于大企业。最后，作者表明，2007/08年的金融危机对财务杠杆与公司绩效之间的关系没有重大影响。

创意/价值

本文提供了关于杠杆对绩效的影响的新证据，尤其是在印度方面。该研究也是最早研究企业规模和金融危机在杠杆绩效关系中的作用的研究之一。