How Does Leverage Affect Corporate Value?Quantile Regression Analysis of Heterogeneous Enterprises

The influence of corporate leverage on corporate value has been in dispute for a long time. This study adopted quantile regression model and compared the results with normal models which are related to least square and fixed effect from the perspective of enterprise heterogeneity of various sectors and regions based on the 5780 sample of listed A-share non-financial enterprises from year 2008 to 2019. The results showed that when the corporate value was before 5% quantile,the leverage had a positive effect on corporate value, but the leverage ratio had an obvious negative effect on corporate value when it passed 5% quantile and the negative effect gradually intensified as the quantiles increased. Specifically, in different sectors, the leverage ratio of sectors such as retail industry, IT industry and manufacturing industry had stronger effect on corporate value than sectors like real estate industry, transportation industry and architecture industry in different quintiles. In different regions, the leverage ratio of enterprises in eastern region had weaker influence on corporate value than enterprises in midwest when the quantile was before 75% quantile and this influence reversed when the quantile was after 75% quantile. The results brought a new perspective as to how corporate leverage influences corporate value and in the meantime provide references for adopting different fiscal leverage strategies and credit management for different sectors and regions.