English
Ciência-IUL
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Descrição Detalhada da Publicação
Título Revista
Mathematics
Ano (publicação definitiva)
2021
Língua
Inglês
País
Suíça
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Abstract/Resumo
Debt structure composition is an essential topic of discussion for the management of capital structure decisions. Researchers made extensive efforts to understand the criteria for selecting debts, specifically, to know about the reasons for debt specialization, concealed in identifying its predictors. This question is essential not only for establishing the field of debt structure but also for the financial managers to design corporate financial strategy in a way that leads to attaining an optimal debt structure. Sophisticated financial modeling is applied to identify the core predictors of debt specialization, influencing the strategic choices of optimal debt structure to address this issue. Data were collected from 419 non-financial companies listed at the Karachi Stock Exchange from 2009 to 2015. This study has validated debt specialization by showing that short-term debts maintain their position over the years and remain the most popular type of loan among Pakistani firms. Further, it provides a comprehensive view of the cross-sectional differences among the firms involved in debt specialization by applying a holistic approach. Results show that small, growing, dividend-paying companies, having high expense and risk ratios, followed the debt specialization strategy. This strategy enables firms to reduce their agency conflicts, transaction costs, information asymmetry, risk management and building up their good market reputation. Conclusively, we have identified the gross profit margin, long-term debt to asset ratio, firm size, age, asset tangibility, and long-term industry debt to asset ratio as reliable and core predictors of debt specialization for sustainable business growth.
Agradecimentos/Acknowledgements
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Palavras-chave
Debt specialization,Corporate financial strategy,Optimal debt structure,Agency conflicts,Transaction cost,Information asymmetry,Financial modeling,Risk management
Classificação Fields of Science and Technology
- Economia e Gestão - Ciências Sociais
Prémios
Debt specialization; Corporate financial strategy; Optimal debt structure; Agency conflicts; Transaction cost; Information asymmetry; Financial modeling; Risk management
Registos de financiamentos
| Referência de financiamento | Entidade Financiadora |
|---|---|
| UIDB/04466/2020 | Fundação para a Ciência e a Tecnologia |
Contribuições para os Objetivos do Desenvolvimento Sustentável das Nações Unidas
Com o objetivo de aumentar a investigação direcionada para o cumprimento dos Objetivos do Desenvolvimento Sustentável para 2030 das Nações Unidas, é disponibilizada no Ciência-IUL a possibilidade de associação, quando aplicável, dos artigos científicos aos Objetivos do Desenvolvimento Sustentável. Estes são os Objetivos do Desenvolvimento Sustentável identificados pelo(s) autor(es) para esta publicação. Para uma informação detalhada dos Objetivos do Desenvolvimento Sustentável, clique aqui.
