Static or Dynamic Capital Structure Policy Behavior: Empirical Evidence from Indonesia

• 발행기관: 한국유통과학회
• 저자명: Elok Sri UTAMI Tatang Ary GUMANTI Bambang SUBROTO Umrotul KHASANAH
• 간행물 정보: 『The Journal of Asian Finance, Economics and Business(JAFEB)』Vol. 8 No.1, 71~79쪽, 전체 9쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2021.01.30

영문 초록

This study investigates the capital structure policy among Indonesian public companies. Previous studies suggest that capital structure policy could follow either static or dynamic behavior. The sample data used in this study was companies in the manufacturing sector, divided into three sub-sectors: the basic and chemical industry, miscellaneous industry, and the consumer goods industry. This study uses panel data from 2010 to 2018, with the Generalized Least Square (GLS) method and compared whether the fixed effect model is better than the common effect model. The results show that the dynamic and non-linear model tests can explain the capital structure determinants than the static and linear models. The dynamic model shows that the capital structure of a certain year is influenced by the capital structure of the previous year. The findings indicate that the company performs some adjustments in its capital structure policy by referring to the previous debt ratio, which implies support to the trade-off theory (TOT). The study also shows that profitability, tangible assets, size, and age explain the variation of capital structure policy. The patterns on the dynamic and non-linear confirm that capital structure runs in a nonlinear pattern, based on the sector, company condition, and the dynamic environment.

목차

1. Introduction

2. Literature Review and Hypotheses

3. Research Methods and Materials

4. Analysis Result And Discussion

5. Conclusion

References

키워드

Capital Structure Static Dynamic Linear Non-Linear