engleski

Capital Structure of a Company with a Focus on Industry Affiliation: Case of Croatia

The purpose of this paper is to analyze capital structure of Croatian companies with a focus on their industry affiliation. Most of the empirical research is focused on determinants of capital structure such as firm size, profitability, growth rate, etc. Basically, they focus on internal characteristics of companies, neglecting other important variables. One of those less tested determinants is industry affiliation of the firm. According to some authors, industry affiliation undoubtedly affects financial decisions, it is therefore important to incorporate it in empirical analysis more often. With that aim, the authors analyze the differences and similarities in capital structures of Croatian companies regarding their industry affiliation. At the same time the relation between financial leverage on the one hand, and profitability, asset tangibility and firm size on the other hand will be tested, but also in terms of industry classification. Observation period is from year 2007 to 2012.

capital structure ; determinants of capital structure ; industry affiliation ; Croatian companies

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