Structures of Corporate Finance in Germany and France. A Comparative Analysis for West German and French Incorporated Enterprises / Strukturen der Unternehmensfinanzierung in Deutschland und Frankreich. Eine vergleichende Analyse für westdeutsche und französische Kapitalgesellschaften

Abstract

Summary The study examines the balance sheet structures of both French and west German incorporated firms in manufacturing and their evolution during the last business cycle in the late eighties and early nineties. The point of departure is to focus op the relative importance of the different financing sources used by the incorporated enterprises in the two countries. A deeper examination of the observed differences suggests that country-specific legal and institutional factors seem to play an important role in determining corporate finance structures. Finally this evidence is considered in the context of capital structure theory with particular reference to the architecture and functioning mechanisms of the corporate financing systems in Germany and France.