How Financing structure Affects Firm Performance: Empirical Evidence from Chinese Automobile Listed CompaniesTools YIXUAN, LYU (2020) How Financing structure Affects Firm Performance: Empirical Evidence from Chinese Automobile Listed Companies. [Dissertation (University of Nottingham only)]
AbstractThis paper examines the effect of financing structure on firm performance in the context of Chinese automobile listed companies. The secondary dataset consists of 133 Chinese A-share listed firms in the automobile industry between 2009 and 2019, total up to 11 years’ period is collected from the CSMAR database and used as a research sample in this paper. There are six determinants, namely internal financing rate, current liability ratio, the asset to liability ratio, commercial credit rate, bank loan ratio, and ownership concentration. In particular, this research not only uses the traditional financial indicator, ROA as the proxy of firm performance but also employs the factor analysis to obtain a comprehensive factor of firm performance. Relied on the result of the Hausman test, the fixed effect model is applied to compare those two models that two different dependent variables regress on the same six independent variables. It is found that there exists a statistically significant association between current liability ratio, the asset to liability ratio, ownership concentration, commercial credit rate, and firm performance. while the bank loan ratio does not emerge a statistically significant effect on firm performance.
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