Determinants of Capital Structure of UK Quoted Companies
Paulauskas, Justas (2008) Determinants of Capital Structure of UK Quoted Companies. [Dissertation (University of Nottingham only)] (Unpublished)
This paper investigates the determinants of capital structure in UK, seeks to determine, which capital structure theory is more applicable to UK companies, and intends to compare UK findings with previous empirical literature. Five determinants of capital structure, namely firm size, asset tangibility, profitability, growth opportunities and non-debt tax shields, are used in the research. Panel data set of 446 UK public quoted companies during 1998-2007 period is employed. Research methodology encompasses the use of several multiple regression models, namely regression with industry dummies to measure the importance of industry effects in explaining debt ratios, pooled panel OLS regression, and fixed/random effects panel data regression that accounts for firm-specific time-invariant heterogeneity in the data. Additionally, time dummies are added in each regression to include for sample-wide macroeconomic shocks. Each model is tested using both book debt and market debt ratios.
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