The Interrelationship between Culture, Capital Structure, and Performance

Gleason, Kimberly C.; Mathur, Lynette Knowles; Mathur, Ike

doi:10.1016/s0148-2963(99)00031-4

Cited by 270 publications

(270 citation statements)

References 10 publications

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“…The coefficients of the explanatory variables are expected to take the following signs: the direction of the relationship between financial performance and leverage cannot be assessed a priori because previous empirical studies have yielded mixed results. While some researchers found a positive relationship [23][24][25], others demonstrated that firms using more debt in their capital structures have lower financial performance [26][27][28]. The sign of the liquidity variable could also be positive or negative.…”

Section: Variablesmentioning

confidence: 99%

Factors Affecting Firm Competitiveness: Evidence from an Emerging Market

Akben-Selçuk

2016

IJFS

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Abstract:The objective of this study is to investigate the factors affecting firm competitiveness in an emerging market-Turkey. In the paper, competitiveness is proxied by a firm's financial performance. The empirical analysis is based on firms listed on Borsa Istanbul and covers the period between 2005 and 2014. Results from a firm-level panel data model indicate that return on assets is positively related to firm size, international sales, liquidity and growth, and negatively related to leverage and R&D expenditures. On the other hand, gross profit margin is positively related to size and international sales, and negatively related to leverage and R&D expenditures. Finally, results show that Tobin's Q ratio is higher for firms with higher levels of debt and higher liquidity levels.

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Section: Variablesmentioning

confidence: 99%

Factors Affecting Firm Competitiveness: Evidence from an Emerging Market

Akben-Selçuk

2016

IJFS

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“…The results suggested a significant positive relationship between short-term debt and the Ghanaian company's profitability, as firms earn more it use more short-term debt to finance their business. Gleason, Mathur, and Mathur (2000) investigated the association between capital structure and performance in 14 European countries; the results show that capital structure significantly affects the performance. Fama and French study (2002) and Wald (1999), found that profitability was the most important factor in determining the capital structure, where they found a statistically significant inverse relationship between profitability and debt ratio in capital structure.…”

Section: Literature Reviewmentioning

confidence: 99%

Capital Structure and Firm’s Performance of Jordanian Manufacturing Sector

Ramadan¹,

Ramadan²

2015

IJEF

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This study aimed to identify the effect of capital structure on the performance of the industrial Jordanian Companies listed on Amman Stock Exchange during the period between: 2005 to 2013, whereas this study was applied on all Jordanian industrial companies listed at ASE and which amount 72 companies as in December, 2013. In order to achieve the objective of the current study the unbalanced cross sectional pooled Ordinary Least Square (OLS) regression model was used. The results of this study showed that there was statistically significant inverse effect of capital structure, expressed by long-term debt to capital ratio, total debt to capital ratio and total debt to total assets ratio, on the performance of the Jordanian industrial companies listed at ASE expressed by Return on asset ratio (ROA), which means that the most profitable companies rely less on borrowing to finance their cash needs, and this result is supported by Pecking-order theory which states that the relationship between borrowing and profitability of the company is an inverse relationship so that the most profitable companies are less dependent on profits to finance their needs.

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“…Krishnan and Moyer (1997) found a negative and significant impact of total debt to total equity (TD/TE) on Return on Equity (ROE). Gleason, Mathur and Mathur, (2000) found that firms capital structure has a negative and significant impact on firms performance measures return on assets (ROA). Toraman et al (2013) investigated the effects of capital structure decisions on firms' profitability in manufacturing sector in Turkey.…”

Section: The Pecking Order Theorymentioning

confidence: 99%

The Relationship between Capital Structure and Performance in Gulf Countries Banks: A Comparative Study between Islamic Banks and Conventional Banks

Meero¹

2015

IJEF

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This paper mainly has two objectives: the first one is to identify the similarity of capital structure between Islamic and Conventional banks; Second objective is to detect the relationship between capital structure variables and performance of Islamic and Conventional Banks in Gulf Countries (GC). This investigation has been performed on a sample of 16 GC Banks (8 Islamic Banks and 8 Conventional Banks) for the period 2005-2014. ROE (return on equity) and ROA (return of asset) have been used as performance measures. Total debt to total assets, Equity to total assets, Debt to equity ratios have been used as capital structure measures. Size of the bank has been considered as dependent variable to identify its relationship with bank performance. Data collected were analyzed by using SPSS software. The results of the research indicate a similarity of capital structure of Islamic banks and Conventional banks in Gulf Countries. ROA as performance measurement has a significant negative relationship with financial leverage and a positive relationship with equity to assets ratio. This relationship is identified at Islamic banks, Conventional banks and all the banks of the sample. Bank size has a positive relationship with ROA and ROE as performance measures in Islamic and Conventional banks.

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The Interrelationship between Culture, Capital Structure, and Performance

Cited by 270 publications

References 10 publications

Factors Affecting Firm Competitiveness: Evidence from an Emerging Market

Factors Affecting Firm Competitiveness: Evidence from an Emerging Market

Capital Structure and Firm’s Performance of Jordanian Manufacturing Sector

The Relationship between Capital Structure and Performance in Gulf Countries Banks: A Comparative Study between Islamic Banks and Conventional Banks

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