Capital structure under collusion

Daniel Ferrés, Gaizka Ormazabal, Paul Povel*, Giorgo Sertsios

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

4 Scopus citations


We analyze the financial leverage of firms that collude to soften product market competition by forming a cartel. We find that cartel firms have lower leverage during collusion periods. This is consistent with the idea that cartel firms strategically reduce leverage to make their cartels more stable, because high leverage makes deviations from a cartel agreement more attractive. Given that cartels have a large economic footprint, their study is also relevant for the capital structure literature, which has largely ignored the role of anti-competitive behavior.

Original languageEnglish
Article number100854
JournalJournal of Financial Intermediation
StatePublished - 1 Jan 2021

Bibliographical note

Publisher Copyright:
© 2020 Elsevier Inc.


  • Capital structure
  • Cartels
  • Collusion
  • Financial leverage


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