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The firm specific determinants of capital structure and the influence of the financial crisis: Evidence from Dutch firms.

Wagenvoort, M.L.J. (2016) The firm specific determinants of capital structure and the influence of the financial crisis: Evidence from Dutch firms.

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Abstract:This paper aims to identify whether the financial crisis had an influence on the determinants of capital structure for Dutch firms. It does so by comparing data of two timeframes namely the pre-crisis period (2006-2007) and crisis period (2008-2009). The determinants that are of interest for the study include; profitability, tangibility, size, growth opportunities and liquidity. The variables are regressed against the dependent variable leverage. The results hold that the mean value of leverage increased during the financial crisis. This indicates that companies searched for external financing when profitability and liquidity levels were diminishing. Furthermore the determinants profitability, tangibility, size and liquidity all seem to be positively related to leverage before the crisis. Whilst the variable growth opportunities appears to be negatively related to leverage. During the crisis the value of the coefficients changed although the direction of the relationship stays the same for all variables except profitability.
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:International Business Administration BSc (50952)
Link to this item:http://purl.utwente.nl/essays/71326
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