In December 2003, the Brazilian Congress passed a law that led to a natural personal lending experiment. The law allows banks to offer loans with repayment through automatic payroll deduction, which, in effect, turns future income into collateral. We estimate the impact of the new law using auto...

This article investigates the effects of privatization under Brazil's National Privatization Program (PND) during the 1990s on companies' capital structure. Our model suggests that privatized firms increased their market leverage by 10--14% on average relative to the level before privatization....