The Performance and Capital Structure of Listed and Non-listed Companies: A Panel Data Analysis of Listed and Non-listed Nordic Firms

Hanna Marie Haavi & Petter Hødal Torgersen

Student thesis: Master thesis


This paper investigates listed and non-listed Nordic firms with the goal of revealing a relationship between their capital structure and performance. Previous studies on the difference between the two company types suggest that deviations in performance primarily stem from organizational distinctions in the separation of ownership and control. However, in this thesis, capital structure theory is used to argue that the access and strategic choices related to leverage-ratios is the main structural difference between listed and non-listed firms and that this must be a substantial determinant of the distinctions in performance. By analyzing panel data from 24,784 Nordic companies collected over eleven years (2006-2016) using pooled ordinary least squares (POLS), this notion is confirmed. The analysis uses eighteen model specifications to answer twelve hypotheses that are developed based on literature review and previous empirical findings. The results of the POLS estimations suggest that non-listed firms have significantly more short-term debt and significantly less long-term debt than listed firms in the aftermath of the global financial crisis. Furthermore, the results indicate that short-term debt is positively related to performance while long-term debt is negatively related, implying that non-listed firms are superior in performance based on different maturity structures. These results are supported when analyzing the differences in performance with and without leverage-ratios. When debt is not controlled for, the non-listed firms significantly outperform listed firms on all performance measures, which is in line with previous research. However, when debt is included in the regression, this performance gap is narrowed significantly, suggesting that the capital structure differences are explaining some of the deviations in the performance of listed and non-listed firms, as proposed initially.

EducationsMSc in Finance and Strategic Management, (Graduate Programme) Final Thesis
Publication date2018
Number of pages147