【正文】 r attributes, the uniqueness attribute may be negatively related to the observed debt ratio because of its positive correlation with nondebt tax shields and its negative correlation with collateral value. E. Industry Classification Titman suggests that firms that make products requiring the availability of specialized servicing and spare parts will find liquidation especially costly. This indicates that firms manufacturing machines and equipment should be financed with relatively less debt. To measure this, we include a dummy variable equal to one for firms with SIC codes between 3400 and 4000 (firms producing machines and equipment) and zero otherwise as a separate attribute affecting the debt ratios. F. Size A number of authors have suggested that leverage ratios may be related to firm size. Warner and Ang, Chua, and McConnell provide evidence that suggests that direct bankruptcy costs appear to constitute a larger proportion of a firm39。s liquidation decision is causally linked to its bankruptcy status. As a result, the costs that firms can potentially impose on their customers, suppliers, and workers by liquidating are relevant to their capital structure decisions. Customers, workers, and suppliers of firms that produce unique or specialized products probably suffer relatively high costs in the event that they liquidate. Their workers and suppliers probably have job specific skills and capital, and their customers may find it difficult to find alternative servicing for their relatively unique products. For these reasons, uniqueness is expected to be negatively related to debt ratios. Indictors of uniqueness include expenditures on research and development over sales (RD/S), selling expenses over sales (SEIS), and quit rates (QR), the percentage of the industry39。 consumption of perquisites. The estimated model incorporates two indicators for the collateral value attribute. They include the ratio of intangible assets to total assets (INT/TA) and the ratio of inventory plus gross plant and equipment to total assets (IGP/TA). The first indicator is negatively related to the collateral value attribute, while the second is positively related to collateral value. B. NonDebt Tax Shields DeAngelo and Masulis present a model of optimal capital structure that incorporates the impact of corporate taxes, personal taxes, and nondebtrelated corporate tax shields. They argue that tax deductions for depreciation and investment tax credits are substitutes for the tax benefits of debt financing. As a result, firms with large nondebt tax shields relative to their expected cash flow include less debt in their capital structures. Indicators of nondebt tax shields include the ratios of investment tax credits over total assets (ITC/TA), depreciation over total assets (DITA), and a direct estimate of nondebt tax shields over total assets (NDT/TA). The latter measure is calculated from observed federal ine tax payments (T), operating ine (OI), interest payments (i), and the corporate tax rate during our sample period (48%), using the following equation: NDT = OIiT/ which follows from the equality T= (0I iNDT) These indicators measure the current tax deductions associated with capital equipment and, hence, only partially capture the nondebt tax shield variable suggested by DeAngelo and Masulis. First, this attribute excludes tax deductions that are not associated with capital equipment, such as research and development and selling expenses. (These variables, used as indicators o