SOAS Research Online

A Free Database of the Latest Research by SOAS Academics and PhD Students

[skip to content]

Fattouh, Bassam, Pisicoli, Beniamino and Scaramozzino, Pasquale (2024) 'Debt and Financial Fragility: Italian Non-Financial Companies after the Pandemic.' Economic Modelling, 131 (106628).

Text - Published Version
Available under License Creative Commons Attribution-NonCommercial 4.0 (CC BY-NC 4.0).

Download (6MB) | Preview


This paper analyses the evolution of debt of Italian firms from 2010 to 2020 with special focus on the first year of the Covid-19 pandemic. We use quantile regressions to assess the vulnerabilities of the most indebted firms. On average Italian non-financial companies (NFCs) reduced their indebtedness over the sample period, a trend which continued during the first year of the pandemic. By exploiting the high heterogeneity in the data, however, we find that the turmoil affected the most indebted firms for which the trend of declining indebtedness was reversed. Moreover, sectors that were suspended during the first lockdown already had the highest levels of the debt-to-assets ratios, and experienced the steepest increase in debt in 2020. Finally, our results show that highly indebted firms exhibit a qualitatively different behaviour compared to the rest of the sample. Excessive debt build-up severely increases the likelihood of non-financial companies exiting the market.

Item Type: Journal Article
Keywords: Leverage, Corporate debt, Debt ratio, Quantile regression
SOAS Departments & Centres: Departments and Subunits > School of Finance & Management
Subjects: H Social Sciences > HG Finance
H Social Sciences > HJ Public Finance
ISSN: 02649993
DOI (Digital Object Identifier):
Date Deposited: 01 Jan 2024 14:18

Altmetric Data


Download activity - last 12 monthsShow export options
Downloads since deposit
6 month trend
6 month trend
Accesses by country - last 12 monthsShow export options
Accesses by referrer - last 12 monthsShow export options

Repository staff only

Edit Item Edit Item