Corporate ownership and capital structure: evidence from Romania
This study explores the relation between local and foreign corporate ownership and capital structure of Romanian listed companies (as proxied by debt ratio, short-term debt ratio, and long-term debt ratio in total assets). Our empirical analysis indicates that corporations, as shareholders of public...
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| Format: | Article |
| Language: | English |
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Alexandru Ioan Cuza University of Iasi
2019-06-01
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| Series: | Eastern Journal of European Studies |
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| Online Access: | http://ejes.uaic.ro/articles/EJES2019_1001_TAR.pdf |
| _version_ | 1819043495930757120 |
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| author | Alina ȚARAN |
| author_facet | Alina ȚARAN |
| author_sort | Alina ȚARAN |
| collection | DOAJ |
| description | This study explores the relation between local and foreign corporate ownership and capital structure of Romanian listed companies (as proxied by debt ratio, short-term debt ratio, and long-term debt ratio in total assets). Our empirical analysis indicates that corporations, as shareholders of public companies, determine a reduction in the overall need of external debts of the investee firms. However, foreign corporate shareholders promote a short-term indebtedness policy of non-financial companies listed on the regulated segment of Bucharest Stock Exchange. In contrast, local corporate shareholders have a negative influence on the short-term debt of their affiliates. Our findings provide a better understanding of financing decisions of domestic entities, and consequently, may contribute to efficient investing and management decisions of business actors in Romania, and other European frontier markets. |
| first_indexed | 2024-12-21T09:57:42Z |
| format | Article |
| id | doaj.art-6df8a6ebbec84409953d7d8193937dfc |
| institution | Directory Open Access Journal |
| issn | 2068-651X 2068-6633 |
| language | English |
| last_indexed | 2024-12-21T09:57:42Z |
| publishDate | 2019-06-01 |
| publisher | Alexandru Ioan Cuza University of Iasi |
| record_format | Article |
| series | Eastern Journal of European Studies |
| spelling | doaj.art-6df8a6ebbec84409953d7d8193937dfc2022-12-21T19:08:01ZengAlexandru Ioan Cuza University of IasiEastern Journal of European Studies2068-651X2068-66332019-06-01101133150Corporate ownership and capital structure: evidence from RomaniaAlina ȚARAN0Izmir University of Economics, Izmir, TurkeyThis study explores the relation between local and foreign corporate ownership and capital structure of Romanian listed companies (as proxied by debt ratio, short-term debt ratio, and long-term debt ratio in total assets). Our empirical analysis indicates that corporations, as shareholders of public companies, determine a reduction in the overall need of external debts of the investee firms. However, foreign corporate shareholders promote a short-term indebtedness policy of non-financial companies listed on the regulated segment of Bucharest Stock Exchange. In contrast, local corporate shareholders have a negative influence on the short-term debt of their affiliates. Our findings provide a better understanding of financing decisions of domestic entities, and consequently, may contribute to efficient investing and management decisions of business actors in Romania, and other European frontier markets.http://ejes.uaic.ro/articles/EJES2019_1001_TAR.pdfforeign ownershipdebt ratiosfrontier marketsdeveloping economiesCentral and Eastern European countries |
| spellingShingle | Alina ȚARAN Corporate ownership and capital structure: evidence from Romania Eastern Journal of European Studies foreign ownership debt ratios frontier markets developing economies Central and Eastern European countries |
| title | Corporate ownership and capital structure: evidence from Romania |
| title_full | Corporate ownership and capital structure: evidence from Romania |
| title_fullStr | Corporate ownership and capital structure: evidence from Romania |
| title_full_unstemmed | Corporate ownership and capital structure: evidence from Romania |
| title_short | Corporate ownership and capital structure: evidence from Romania |
| title_sort | corporate ownership and capital structure evidence from romania |
| topic | foreign ownership debt ratios frontier markets developing economies Central and Eastern European countries |
| url | http://ejes.uaic.ro/articles/EJES2019_1001_TAR.pdf |
| work_keys_str_mv | AT alinataran corporateownershipandcapitalstructureevidencefromromania |