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Factors Determining Capital Structure of Pakistani Non-Financial Firms

International Journal of Business Studies Review

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Field Value
 
Title Factors Determining Capital Structure of Pakistani Non-Financial Firms
 
Creator Atta Ullah Khan, Mumtaz Hussain Shah,
 
Description This study is undertaken to discover the factors determining the capital structure decision of non-financial Pakistani firms. The effect of firm’s profitability, liquidity, size, tangibility and non-debt tax shield on capital structure decision of ten non-financial firms operating at Pakistan Stock Exchange is investigated for a period of ten years i-e from 2005-2014. By using fixed effects panel estimation method, it is found that leverage ratio is inversely affected by profitability and current ratio of a firm. While, firm size, tangibility and non-debt tax shield positively effects leverage ratio. The influence of profitability is weakly significant whereas that of liquidity, size, tangibility and non-debt tax shield are strongly significant. The study also shows that results for profitability and liquidity are in accordance with the Pecking Order Theory and the result for size; tangibility and non-debt tax shield are in line with the Trade-Off Theory.
 
Publisher KUST
 
Date 2017-06-05
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
 
Format application/pdf
 
Identifier http://intjourbsr.org/index.php/ijbsr/article/view/51
 
Source International Journal of Business Studies Review; Vol 2 No 1 (2017); 41-52
2521-0068
 
Language eng
 
Relation http://intjourbsr.org/index.php/ijbsr/article/view/51/45