Does national culture affect corporate capital structure?

I examine the impact of national culture on corporate capital structure decisions. Based on prior research, corporate debt ratio is expected to be influenced by national culture after controlling for firm-level and country-level effects. I use Hofstede’s six cultural dimensions (Power Distance, Individualism, Masculinity, Uncertainty Avoidance, Long-term Orientation, and Indulgence) to capture national culture, and my sample comprises 25,216 firm-year observations across 37 countries over the period 2006–2015. In my study, it is robust that firms in countries with high Power Distance, Individualism, and Long-term Orientation tend to have more debt. However, the influence of Masculinity, Uncertainty Avoidance and Indulgence on capital structure decisions is ambiguous. My findings support the results of prior literature and also add new evidence to the culture and finance literature