Download or read book The Impact of Ownership Structure and Investment Decisions on Capital Structure written by Dua'a Fawzi Shaker Shubita and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This note is part of Quality testing.

Download or read book Ownership Structure as a Determinant of Capital Structure An Empirical Study of DAX Companeis written by Christian Funke and published by GRIN Verlag. This book was released on 2012-03-02 with total page 105 pages. Available in PDF, EPUB and Kindle. Book excerpt: Diploma Thesis from the year 2004 in the subject Business economics - Business Management, Corporate Governance, grade: 1.1, European Business School - International University Schloß Reichartshausen Oestrich-Winkel, language: English, abstract: Empirische Diplomarbeit die mit einer multivariaten Regression untersucht, ob sich die beobachtete Variabilität der Kapitalstrukturen von Unternehmen durch unterschiedliche Eigentümerstrukturen erklären lässt.

Download or read book Ownership Concentration Risk Aversion and the Effect of Financial Structure on Investment Decisions written by Guochang Zhang and published by . This book was released on 1998 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the effect of capital structure on investment decisions when the firm is controlled by a large, risk-averse shareholder. Because of under-diversification, the controlling shareholder is more averse to risky projects than other shareholders whose portfolios are fully diversified, causing potential quot;under-investmentquot; problems. We show that such under-investment problems can be mitigated by issuing risky debt because of the quot;risk-shiftingquot; effect of debt. The paper demonstrates a unique equilibrium capital structure, involving both risky debt and equity, which is directly linked to the ownership structure. The analysis leads to empirical predictions about how ownership and capital structure are inter-related, and how capital structure is affected by such exogenous factors as the identity of the controlling shareholder and project risk. Existing empirical studies mostly support these predictions.

Download or read book Capital Structure Decisions written by Yamini Agarwal and published by John Wiley & Sons. This book was released on 2013-03-29 with total page 208 pages. Available in PDF, EPUB and Kindle. Book excerpt: Inside the risk management and corporate governance issues behind capital structure decisions Practical ways of determining capital structures have always been mysterious and riddled with risks and uncertainties. Dynamic paradigm shifts and the multi-dimensional operations of firms further complicate the situation. Financial leaders are under constant pressure to outdo their competitors, but how to do so is not always clear. Capital Structure Decisions offers an introduction to corporate finance, and provides valuable insights into the decision-making processes that face the CEOs and CFOs of organizations in dynamic multi-objective environments. Exploring the various models and techniques used to understand the capital structure of an organization, as well as the products and means available for financing these structures, the book covers how to develop a goal programming model to enable organization leaders to make better capital structure decisions. Incorporating international case studies to explain various financial models and to illustrate ways that capital structure choices determine their success, Capital Structure Decisions looks at existing models and the development of a new goal-programming model for capital structures that is capable of handling multiple objectives, with an emphasis throughout on mitigating risk. Helps financial leaders understand corporate finance and the decision-making processes involved in understanding and developing capital structure Includes case studies from around the world that explain key financial models Emphasizes ways to minimize risk when it comes to working with capital structures There are a number of criteria that financial leaders need to consider before making any major capital investment decision. Capital Structure Decisions analyzes the various risk management and corporate governance issues to be considered by any diligent CEO/CFO before approving a project.

Download or read book Capital Structure Equity Ownership and Corporate Performance written by Krishna Dayal Pandey and published by Taylor & Francis. This book was released on 2023-08-16 with total page 135 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides empirical insights into the relationship between capital and equity-ownership structure of Indian manufacturing companies and their financial performance. It discusses and analyses the basic theories and concepts associated with capital structure, debt financing, levered and unlevered firms, the various forms of ownership, agency problem and its kind and the exploitation of minority owners by the large and largest owners. The study employs a set of the most reliable and suitable econometric estimation techniques to draw meaningful inferences on the Indian manufacturing sector. The novelty of this book lies in three particular aspects: the depth and dimension with which the topic is addressed; the robust empirical evidence that it has produced and the simple and intelligible approach with which it is authored. It communicates the crucial relevance of corporate capital structure and equity-ownership to the moderation of agency relationship and shaping the internal governance mechanism, which ultimately results in increased or decreased operational efficiency and financial performance. It will enable readers to understand whether an increased amount of debt capital would bring about positive results for firms or create an extra burden on the management of their finances, preventing them from taking productive investment decisions due to the threat of liquidation. The book will find an audience among advanced students, scholars and researchers who are interested in understanding the corporate finance practices and governance mechanism of Indian organizations.

Download or read book Capital Structure and Firm Performance written by Arvin Ghosh and published by Routledge. This book was released on 2017-07-05 with total page 140 pages. Available in PDF, EPUB and Kindle. Book excerpt: Capital structure theory is one of the most dynamic areas of finance and forms the basis for modern thinking on the capital structure of firms. Much controversy has resulted from comparisons of the theory of capital structure originally developed by Franco Modigliani and Merton Miller to real-world situations. Two competing theories have emerged over the years, the optimal capital structure theory and the pecking order theory.Arvin Ghosh begins with an overview of the controversies regarding capital structure theories, and then statistically tests both the optimal capital structure and pecking order theories. Using the binomial approach he analyzes the determinants of capital structure while discussing the role of market power in determining capital structure decisions. Ghosh probes the questions of new stock offerings and stockholders' returns, and analyzes capital structure and executive compensation. He then looks into debt financing ownership structure, and the controversal relationship between capital structure and firm profitability. Finally, he discusses the latest developments in the field of capital structure.A concise overview of a major issue in business economics and finance, this volume provides a fuller understanding of capital structure influence on the financial performance of firms, and will certainly stimulate further debate. While hundreds of scholarly articles have been written on the subject this is the first book to test competing theories against measurements of firms' performance and their underlying capital structure.

Download or read book An Analysis of Effects of Ownership on Capital Structure and Corporate Performance of South African Firms written by Tapiwa Dube and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The question of whether ownership matters remains an important one in corporate financial policy. The types of owners of the means of production in an economy and the extent to which ownership is concentrated or diffused are important issues for an economy because they may have important effects on the leadership and control of such firms. Such effects influence the economy at macro level. The work by Berle and Means (1932:47) was based on firms owned by many shareholders with small ownership stakes, which were run by professional managers who had little or no ownership, leading to questions of ownership and corporate performance. Important decisions have to be made in firms regarding capital structure and performance. Although the literature covers the effects of concentration and types of ownerships on capital structure and corporate performance, the results are mixed. Theoretical studies explain factors that affect leverage and corporate performance but empirical studies provide inconclusive results. The questions pertaining to the effects of ownership concentration on leverage and corporate performance persist, with different institutional settings contributing to the lack of generalisable results. Inconclusive results are also attributed to the different statistical methods employed and the time periods of such studies. Few studies combine several ownership types and ownership concentration to analyse their effects on capital structure and corporate performance, especially in developing countries. Therefore, the purpose of this research was to investigate the effects of ownership on capital structure and corporate performance in South Africa. Ownership in this study was subdivided into ownership concentration and ownership type. The Herfindahl index was the measure of ownership concentration at the top one, two, three, five and 10 shareholding levels and the types of ownerships consisted of institutional investors, families, government, management, foreigners, companies, Public Investment Corporation, black people and other shareholders. Dependent variables in the relationship with capital structure were long-term debt, short-term debt and total debt ratios based on market value and book value, and the leverage factor. Corporate performance was measured by return on assets, return on equity, TobiniÌ8℗¿℗ưs Q, economic value-added and market value-added as the dependent variables. Capital structure and other theories were used to examine the relationship between ownership and capital structure and results from previous studies were also used to investigate the relationship between ownership and corporate performance. To achieve these objectives, the research used an unbalanced panel of data from 205 non-financial companies listed for an 11-year period from 2004 to 2014 and the fixed effects and the generalised method of moments models to analyse the data. The study found that ownership concentration, ownership by the Public Investment Corporation and black people had negative effects on capital structure. An implication for ownership concentration is that as it increased, the shareholders preferred to use less debt, perhaps meaning that they did not consider it important to take advantage of the monitoring capability associated to debt. Similar reasoning could be attributed to the Public Investment Corporation although an aversion to risk could also be a possible explanation. Due to the way black shareholdings have traditionally been funded in South Africa, such shareholders could shun debt. Ownership by institutions, families, directors, companies and foreigners had positive effects on capital structure. These results implied that some shareholders, such as institutional investors, companies and foreign investors could prefer to use debt in monitoring management. Findings for managerial ownership and capital structure could imply that these types of shareholders used debt to avoid diluting their shareholdings due to their limited wealth. The effect of government ownership on capital structure was mixed. Foreign ownership and ownership by other shareholders had positive effects on corporate performance. The implications of these findings are that foreign investors monitor and provide skills and technology to their investee firms, thereby increasing the performance of these firms. Ownership by management, institutions, black shareholders and the Public Investment Corporation had negative effects on corporate performance. These findings could imply managerial entrenchment, lack of monitoring by the Public Investment Corporation and institutional investors or low levels of shareholdings to enable them to commit resources to investee firms and inadequate experience on the part of black shareholders.

Download or read book Impact of Ownership Structure on Dividend Policy and Capital Structure written by Jan Khan and published by . This book was released on 2016 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study primarily investigates the impact of ownership structure on capital structure and dividend policy in Pakistan. Data is drawn from 50 non-financial companies included in KSE 100 Index for the period 2006 to 2014. In this study leverage and dividend payout are used as dependent variables, while managerial ownership and institutional ownership are explanatory variables. Profitability, sales growth and size of firm are used as control variables. Results of this study reveal that institutional ownership has significant and negative impact on capital structure but significant and positive impact on dividend payout ratio. On the other hand results suggest that managerial ownership negatively affects dividend payout ratio. Moreover results reveal that both of these strategic decisions affect each other negatively.Most of the researchers in Pakistan analyzed the impact of ownership structure on these two strategic decisions separately. But in this study, an advanced empirical technique - two stage least square (2SLS) - is used to find out the impact of ownership structure on both of these strategic decisions (Capital structure and Dividend policy). This technique also helps to determine the two-way relationship between these two strategic decisions.

Download or read book Impact of Capital Structure on Investors Perception written by Dr. Udayakumari Vidhyasagara Menon and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This research is an attempt to study the perception of investors in Oman towards capital structure decision of firms. More specifically, it tries to understand whether capital structure decision matters to investors while taking their investment decisions in the case of Oman for equity stocks. Data was collected using a structured questionnaire from 350 respondents using stratified random sampling. Results provide clear evidence that only few investors believed in indicators like ownership structure and changes in their pattern can provide signals about the future price trends. Furthermore, the survey results also revealed that majority of investors rely on TV news for taking investment decisions. The results provide clear evidence that though stock markets have been functioning in Oman for the last several years, there is a need to increase awareness about financial markets among the people. The investors especially women were not well informed investors. This will have long term impact on capital markets, as better informed investors help in creating efficient stock markets thereby better utilizing financial resources.

Download or read book The influence of the ownership structure of a hotel firm on capital investment decisions written by Karine Bourget and published by . This book was released on 2009 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Corporate Financial Decisions and Market Value written by Giovanni Marseguerra and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 181 pages. Available in PDF, EPUB and Kindle. Book excerpt: How do managers of a firm choose between alternative finan cial policies? Can the choice of a particular financial policy affect the value of the firm? Since the early 1960s, the debate on these questions has been lively and interesting as economists have inves tigated the effect on the value of the firm of relaxing the various assumptions in the celebrated Modigliani-Miller theory. Further more, even if we stick to the MM-assumptions (that is, we assume perfect and complete capital markets, no taxes and symmetric information), and we therefore know that only optimally chosen investments determine firm's value, another interesting question arises: How does the structure of ownership affect investment de cisions (and, in turn, values)? This research monograph attempts to analyze some of the issues involved in this debate. It belongs to the area of mathematical economics and is intended to appeal to mathematical economists as well as economists and mathemati cians. It is meant to deal with economically relevant problems in a mathematically adequate way. To decide whether or not it succeeds in this task, it is up to the reader. I am greatly indebted to Dr. Margaret Bray for her supervi sion of my PhD thesis in Economics at the London School of Eco nomics from which this book resulted. She helped me as friend and adviser through many struggles in the last three years and invested a great amount of work in this thesis.

Download or read book Ownership Structure and Investor Protection written by Marco Klapper and published by GRIN Verlag. This book was released on 2012-06-22 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: Bachelor Thesis from the year 2012 in the subject Business economics - Business Management, Corporate Governance, grade: 1,3, University of Tubingen, language: English, abstract: It is the purpose of this paper to examine to what extent ownership structure can alleviate the agency problem and limit managerial expropriation of small shareholders. Since stock options and other forms of equity are frequently used as compensation for managers, special emphasis is placed on the question of how managerial ownership can affect agency costs and firm value. To evaluate the impact of ownership patterns on shareholder value, this paper surveys and reinterprets scientific advances in the corporate governance literature. A significant part of the analysis covers the interrelation of inside ownership, corporate policies, and shareholder value; as well as the role of endogeneity.

Download or read book Corporate Governance of State Owned Enterprises written by World Bank Publications and published by World Bank Publications. This book was released on 2014-10-02 with total page 391 pages. Available in PDF, EPUB and Kindle. Book excerpt: This Toolkit provides an overall framework with practical tools and information to help policymakers design and implement corporate governance reforms for state-owned enterprises. It concludes with guidance on managing the reform process, in particular how to prioritize and sequence reforms, build capacity, and engage with stakeholders.

Download or read book Corporate Capital Structures in the United States written by Benjamin M. Friedman and published by University of Chicago Press. This book was released on 2009-05-15 with total page 404 pages. Available in PDF, EPUB and Kindle. Book excerpt: The research reported in this volume represents the second stage of a wide-ranging National Bureau of Economic Research effort to investigate "The Changing Role of Debt and Equity in Financing U.S. Capital Formation." The first group of studies sponsored under this project, which have been published individually and summarized in a 1982 volume bearing the same title (Friedman 1982), addressed several key issues relevant to corporate sector behavior along with such other aspects of the evolving financial underpinnings of U.S. capital formation as household saving incentives, international capital flows, and government debt management. In the project's second series of studies, presented at the National Bureau of Economic Research conference in January 1983 and published here for the first time along with commentaries from that conference, the central focus is the financial side of capital formation undertaken by the U.S. corporate business sector. At the same time, because corporations' securities must be held, a parallel focus is on the behavior of the markets that price these claims.

Download or read book Corporate Ownership Capital Structure and Investment written by Mika Ihamuotila and published by . This book was released on 1994 with total page 182 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Financial Constraints Capital Structure and Dividend Policy written by Ala'a Adden Awni Abuhommous and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The economic reforms in Jordan during the last two decades have highlighted and promoted the role that non-financial firms play within the Jordanian economy. The ability of firms to play this role is in major part determined by the structure of the financial system in which they operate, and in particular whether this financial system is able to make capital available efficiently to those firms that need it. Whether this is the case can be investigated by analysing the impact of firm characteristics on some of the most important financial decisions taken by these firms, and how these decisions are influenced by the presence of market imperfections. The thesis examines the relation between the financing and investment decisions, where the effect of financial constraints on the firm's investment decision is investigated. In particular, this thesis focuses on how financial constraints affect different firms by investigating the extent to which the reliance on internal cash flow is affected by firm characteristics such as size, age, dividend payout ratio, and market listing. We find that Jordanian firms are financially constrained, but that these constraints do not appear to be related to firm characteristics. Further, results show that Jordanian firms use debt rather than equity to finance their investment. The second empirical chapter focuses on the main determinants of firms' capital structure. Here the results show that Jordanian firms follow the pecking order theory, where profitability and liquidity have a negative impact on the level of debt. Size and market to book value have a positive impact, supporting the view that there are significant constraints on debt financing since indicators of the financial health of the firms affect their capital structure ratio. There is also evidence that ownership structure affects the firm's access to debt. The final empirical chapter examines the impact of firm characteristics on dividend policy, and shows that profitability and market to book value have a positive impact on dividend policy, implying that firms with better access to capital or credit pay dividends. This implies that firms retain earnings in order to ensure that they have sufficient capital to invest, confirming the initial result that Jordanian firms are financially constrained. There is also evidence of the impact of ownership structure, consistent with the predictions of agency cost theory, while institutional investors appear to follow the prudent-man restrictions, being positively associated with firms that pay dividends. This thesis confirms the presence of market imperfections that have a significant influence on the financial decisions taken by Jordanian firms. The consistent evidence of the importance of retained earnings shows that these firms face substantial constraints in terms of their access to external funds, despite the reforms to the Jordanian financial system over the last two decades.

Download or read book The Debt equity Choice written by Ronald W. Masulis and published by . This book was released on 1988 with total page 168 pages. Available in PDF, EPUB and Kindle. Book excerpt: