Are Leases and Debt Substitutes? Evidence From Capital Structure Adjustment

2016 ◽  
Author(s):  
Shofiqur Rahman ◽  
Harikumar Sankaran
Keyword(s):  
Capital Structure ◽  
Structure Adjustment

Debt Covenants and the Speed of Capital Structure Adjustment

2017 ◽  
Author(s):  
Erik Devos ◽  
Shofiqur Rahman ◽  
Desmond Tsang
Keyword(s):  
Capital Structure ◽  
Debt Covenants ◽  
Structure Adjustment

Institutional determinants of capital structure adjustment speeds

2012 ◽  
Vol 103 (1) ◽  
pp. 88-112 ◽  
Author(s):  
Özde Öztekin ◽  
Mark J. Flannery
Keyword(s):  
Capital Structure ◽  
Institutional Determinants ◽  
Structure Adjustment

Firm Characteristics and Dynamic Capital Structure Adjustment

2006 ◽  
Author(s):  
Wolfgang Drobetz ◽  
Pascal Pensa ◽  
Gabrielle Wanzenried
Keyword(s):  
Capital Structure ◽  
Firm Characteristics ◽  
Structure Adjustment ◽  
Dynamic Capital Structure

Supply-side structural reform and dynamic capital structure adjustment: Evidence from Chinese-listed firms

2021 ◽  
Vol 65 ◽  
pp. 101482
Author(s):  
Xiaochen Jiang ◽  
Jim Huangnan Shen ◽  
Chien-Chiang Lee ◽  
Chong Chen
Keyword(s):  
Capital Structure ◽  
Structural Reform ◽  
Supply Side ◽  
Listed Firms ◽  
Structure Adjustment ◽  
Dynamic Capital Structure

Split-share reforms and capital structure adjustment in China: a dynamic panel fractional estimation

2020 ◽  
Vol 47 (6) ◽  
pp. 1265-1280
Author(s):  
Tanveer Ahsan ◽  
Sultan Sikandar Mirza ◽  
Bakr Al-Gamrh ◽  
Muhammad Zubair Tauni
Keyword(s):  
Capital Structure ◽  
Positive Impact ◽  
Easy Access ◽  
Dynamic Panel ◽  
Chinese Firms ◽  
Data Set ◽  
Content Type ◽  
Structure Adjustment ◽  
The Government ◽  
Nonfinancial Firms

PurposeThe purpose of this study is to explain the adjustment rate toward the target capital structure of Chinese nonfinancial listed firms and to investigate the impacts of the split-share reforms (2005–2006) on the capital structure adjustment rate.Design/methodology/approachThe authors control for the unobserved heterogeneity and the fractional nature of the adjustment rate by applying an unbiased dynamic panel fractional estimator on the unbalanced panel data of 27,545 firm-year observations of Chinese nonfinancial firms listed during 1998–2015.FindingsThe authors find that Chinese firms adjust at an annual rate of 19–27% to reach their capital structure targets. The authors also find a positive impact of the split-share reforms on the adjustment rates of Chinese nonfinancial firms toward their target capital structure. Split-share reforms also helped Chinese firms to increase the use of equity financing in their capital structure.Practical implicationsThe authors argue that the government should strengthen capital markets to enable easy access to more financing options so that Chinese firms can acquire cheaper external financing.Originality/valueTo the best of authors' knowledge, this is the first study that applies an unbiased dynamic panel fractional estimator on an extended data set of 27,545 firm-year observations of Chinese nonfinancial firms listed during 1998–2015.

International Evidence on the Heterogeneity of Capital Structure Adjustment Speeds

2013 ◽  
Author(s):  
Wolfgang Drobetz ◽  
Dirk Schilling ◽  
Henning Schrrder
Keyword(s):  
Capital Structure ◽  
International Evidence ◽  
Structure Adjustment

Dynamic Capital Structure Adjustments and Business Group Affiliations: Indian Evidence

2017 ◽  
Vol 6 (1) ◽  
pp. 27-41 ◽  
Author(s):  
Biswajit Ghose ◽  
Kailash Chandra Kabra
Keyword(s):  
Capital Structure ◽  
Ownership Structure ◽  
Agency Conflicts ◽  
Partial Adjustment ◽  
Leverage Ratio ◽  
Financial Firms ◽  
Structure Adjustment ◽  
Adjustment Speed ◽  
Net Benefits ◽  
Target Leverage

This study examines the asymmetries in capital structure adjustment speed depending on firms’ affiliation to business groups. Using partial adjustment framework on a dataset of 2001 listed Indian non-financial firms over the period of 2005–2013, it was found that Indian firms annually adjusted about 37 percent of their deviation from target leverage. Groups firms, in general, adjust their leverage ratio slower than the stand-alone firms, suggesting lesser net benefits of adjustment for the former than the latter. The results are persistent irrespective of firms’ extent of deviation from their target leverage. However, the net benefits of adjustment and consequently the adjustment speed for both the groups of firms, irrespective of their extent of deviation from target leverage, seem to be alike, when they are over-levered and lower for group firms than the stand-alone firms, when they are under-levered. These findings indicate that both group and stand-alone firms face identical threats, when they are over-levered, whereas group firms possibly have alternative arrangements to reduce the owner–manager agency conflicts and tax liability, when they are under-levered. These findings are expected to prove helpful for financial managers in designing their capital structure based on ownership structure, and the nature and extent of deviation from the target leverage.

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