Abstract

GAMBOA, Luis Fernando. ENDEUDAMIENTO: ¿UNA ESTRATEGIA EMPRESARIAL PARA ESTABLECER BARRERAS A LA ENTRADA EN COLOMBIA DURANTE 1995-2003?. Cuad. Econ. [online]. 2008, vol.27, n.48, pp.267-285. ISSN 0121-4772.

This article is an extension of the work of Martin (2003) and it examines whether firms use debt strategically to stop entry of potential rivals in their industry. By using Generalized Method of Moments estimation (GMM), we evaluate the effects of assets, market share and size as proxies for market revenue, and the entry barriers due to indebtedness levels. Our data uses firm-level information for Colombia from 1995-2003, and we introduce a dummy variable for taking into account the industrial effect. We find that firms use assets to limit entry and that indebtedness decreases as firms increase their market share.

Keywords : entry deterrence; debt; GMM.

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