EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH
The study examines the effects of macroeconomic factors and on capital structure of non- financial firms in Africa. Using a recent data for an advanced dynamic model (2step system generalized methods of moment (GMM)) technique for a panel data model of 406 non-financial firm of 8 developing African...
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| Format: | Article |
| Language: | English |
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Department of Accounting and Finance, Federal University Gusau
2020-04-01
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| Series: | Gusau Journal of Accounting and Finance |
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| Online Access: | https://journals.gujaf.com.ng/index.php/gujaf/article/view/16 |
| _version_ | 1818236343261593600 |
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| author | Ahmed Balarabe Musa |
| author_facet | Ahmed Balarabe Musa |
| author_sort | Ahmed Balarabe Musa |
| collection | DOAJ |
| description |
The study examines the effects of macroeconomic factors and on capital structure of non- financial
firms in Africa. Using a recent data for an advanced dynamic model (2step system generalized
methods of moment (GMM)) technique for a panel data model of 406 non-financial firm of 8
developing African nations. The findings reveal that macroeconomic variables are determinant of
capital structure of non-financial in Africa. The findings show that financial managers can benefit
from raising additional capital as macroeconomic conditions are favorable. Moreover,
shareholders should employ firm managers with good knowledge of macroeconomic conditions and
also encourage them raise debt capital needed to fund positive investment. Lastly, Policymakers
should enact policies that promote financial market development because such policies would
complement the banks’ financing strategies and firms would have more access to debt capital.
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| first_indexed | 2024-12-12T12:08:21Z |
| format | Article |
| id | doaj.art-5c1119906e4d422bbc59fd1ae81edca9 |
| institution | Directory Open Access Journal |
| issn | 2756-665X |
| language | English |
| last_indexed | 2024-12-12T12:08:21Z |
| publishDate | 2020-04-01 |
| publisher | Department of Accounting and Finance, Federal University Gusau |
| record_format | Article |
| series | Gusau Journal of Accounting and Finance |
| spelling | doaj.art-5c1119906e4d422bbc59fd1ae81edca92022-12-22T00:24:56ZengDepartment of Accounting and Finance, Federal University GusauGusau Journal of Accounting and Finance2756-665X2020-04-0111EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACHAhmed Balarabe Musa0Nuhu Bamalli Polytecnic, Zaria The study examines the effects of macroeconomic factors and on capital structure of non- financial firms in Africa. Using a recent data for an advanced dynamic model (2step system generalized methods of moment (GMM)) technique for a panel data model of 406 non-financial firm of 8 developing African nations. The findings reveal that macroeconomic variables are determinant of capital structure of non-financial in Africa. The findings show that financial managers can benefit from raising additional capital as macroeconomic conditions are favorable. Moreover, shareholders should employ firm managers with good knowledge of macroeconomic conditions and also encourage them raise debt capital needed to fund positive investment. Lastly, Policymakers should enact policies that promote financial market development because such policies would complement the banks’ financing strategies and firms would have more access to debt capital. https://journals.gujaf.com.ng/index.php/gujaf/article/view/16Capital StructureMacroeconomic FactorsDeveloping AfricaGeneralized Methods of Moment (GMM) |
| spellingShingle | Ahmed Balarabe Musa EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH Gusau Journal of Accounting and Finance Capital Structure Macroeconomic Factors Developing Africa Generalized Methods of Moment (GMM) |
| title | EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH |
| title_full | EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH |
| title_fullStr | EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH |
| title_full_unstemmed | EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH |
| title_short | EFFECT OF MACROECONOMIC FACTORS ON CAPITAL STRUCTURE OF FIRMS IN DEVELOPING AFRICA: A TWO-STEP GMM APPROACH |
| title_sort | effect of macroeconomic factors on capital structure of firms in developing africa a two step gmm approach |
| topic | Capital Structure Macroeconomic Factors Developing Africa Generalized Methods of Moment (GMM) |
| url | https://journals.gujaf.com.ng/index.php/gujaf/article/view/16 |
| work_keys_str_mv | AT ahmedbalarabemusa effectofmacroeconomicfactorsoncapitalstructureoffirmsindevelopingafricaatwostepgmmapproach |