Capital Structure Stability in Selected Southeast Asian Countries
Post by MSF Chula at Sunday, 23 December 2018 03:37 PM

This paper investigates whether capital structure exists in Southeast Asian countries during
the period of 1996 to 2016. Although within-firm variation in leverage is common, as firms
undergo periods of high and low leverage, short periods of leverage stability do occur, mainly at
low level of leverage. In contrast, persistently high level of leverage is very rare.
Country-specific factors provide little explanation for the observed pattern of leverage,
while firm-specific determinants are important focal points. When the effects of these firm-specific
factors are allowed to change periodically, more explanatory power is captured over previously
used firm-fixed effects.

Last updated at Sunday, 23 December 2018 03:37 PM