*2.1. Tangibility*

A company may choose to have higher debt if it has a high tangibility ratio. A high tangibility ratio will probably also have low financial costs according to the trade-off theory. (Chaklader and Chawla 2016; Cortez and Susanto 2012; Rajan and Zingales 1995; Song 2005) obtained in their papers a positive association between tangibility and indebtedness. (Chittenden et al. 1996; Demirgüç-Kunt and Maksimovic 1999; van der Wijst and Thurik 1993) obtained a negative relationship.
