Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
I explore whether a Belgian policy that reduced the corporate tax bias towards debt finance was successful in lowering firm leverage. Using putatively exogenous time series variation in the cost of equity financing and a difference-in-differences strategy that includes similar firms from surrounding countries, I find that the policy did lead to increased equity ratios, with some evidence of a shift from short-term debt to long-term debt.