apital structure adjustment in Latin American firms: An empirical test based on the Error Correction Model

Autor:	Jorge A. Muñoz Mendoza, Carlos L. Delgado Fuentealba, null Carmen L., Sandra M. Sepúlveda Yelpo, null Edinson E., null Diego A.
Rok vydání:	2023
Předmět:	Marketing Economics and Econometrics Management of Technology and Innovation Strategy and Management Business and International Management Finance
Zdroj:	Estudios Gerenciales. :50-66
ISSN:	2665-6744 0123-5923 2000-2017
DOI:	10.18046/j.estger.2023.166.5432
Popis:	The objective of this article is to analyze the capital structure adjustment of Latin American firms through the pecking order and trade-off theories using a sample of 975 non-financial firms for the period 2000-2017. The results support the existence of a target capital structure. Adjustment speeds ranged between 48.9% and 74.3% and generate a rapid convergence of leverage towards its target level. Financial deficits explained less than half of the changes in debt, which contradicts the pecking order theory. The results of the error correction model indicated that companies dynamically deviate from their long-term capital structure. The convergence speeds in the partial adjustment model increased up to 69.5% and 91.7% with the error correction method. These results are relevant for firms and investors.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::5f2a1e64e8ea1f8fd1a21e028b8858aa https://doi.org/10.18046/j.estger.2023.166.5432 Zobrazit plný text záznamu