Most cross-sectional deviation of international capital structure is caused by the heterogeneities of firm-, industry-, and country-specific determinants rather than by legal environment. In particular, most variations observed from international capital structure arise from the heterogeneity of firm-specific characteristics. Collateral value of assets, firm size, and debt- related tax shield benefit are generally viewed as the most influential factors in determining corporate leverage decision. If the heterogeneities at the level of firm, industry, and country are controlled, the...