SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE
The capital structure theory has been applied extensively in corporate fi rms with mixed results. This article examines the role of capital structure on the performance of fi rms in South Africa’s agricultural sector following the pecking order theory. Survey data was collected from smallh...
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| Format: | Article |
| Language: | English |
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University of Life Sciences in Poznań
2015-12-01
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| Series: | Journal of Agribusiness and Rural Development |
| Subjects: | |
| Online Access: | http://www.jard.edu.pl/tom38/zeszyt4/art_67.pdf |
| _version_ | 1818262146528575488 |
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| author | Joseph Chisasa |
| author_facet | Joseph Chisasa |
| author_sort | Joseph Chisasa |
| collection | DOAJ |
| description | The capital structure theory has been applied extensively in corporate fi rms with mixed results. This article examines the role of capital structure on the performance of fi rms in South Africa’s agricultural sector following the pecking order theory. Survey data was collected from smallholder farmers in Mpumalanga and North West provinces during 2013. A total of 500 respondents were included in the survey using the multi-stage sampling technique of which 362 responses were received. Using the structural equation modeling approach, the study observes a positive and signifi cant relationship between capital structure and the performance of smallholder farmers. Both short-term and long-term debt contributes to improved productivity through the purchase of working capital requirements and the acquisition of capital equipment. Furthermore, the study reveals that land size has a positive infl uence on agricultural output. These empirical results suggest that channelling debt capital to farmers will improve their productivity. All models fi t indices applied con- fi rm the model was a good fi t to the data. |
| first_indexed | 2024-12-12T18:58:29Z |
| format | Article |
| id | doaj.art-844843d94b2b44d788f87d8c9f9be380 |
| institution | Directory Open Access Journal |
| issn | 1899-5241 1899-5772 |
| language | English |
| last_indexed | 2024-12-12T18:58:29Z |
| publishDate | 2015-12-01 |
| publisher | University of Life Sciences in Poznań |
| record_format | Article |
| series | Journal of Agribusiness and Rural Development |
| spelling | doaj.art-844843d94b2b44d788f87d8c9f9be3802022-12-22T00:15:09ZengUniversity of Life Sciences in PoznańJournal of Agribusiness and Rural Development1899-52411899-57722015-12-01438635–644SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVEJoseph Chisasa0UniversityThe capital structure theory has been applied extensively in corporate fi rms with mixed results. This article examines the role of capital structure on the performance of fi rms in South Africa’s agricultural sector following the pecking order theory. Survey data was collected from smallholder farmers in Mpumalanga and North West provinces during 2013. A total of 500 respondents were included in the survey using the multi-stage sampling technique of which 362 responses were received. Using the structural equation modeling approach, the study observes a positive and signifi cant relationship between capital structure and the performance of smallholder farmers. Both short-term and long-term debt contributes to improved productivity through the purchase of working capital requirements and the acquisition of capital equipment. Furthermore, the study reveals that land size has a positive infl uence on agricultural output. These empirical results suggest that channelling debt capital to farmers will improve their productivity. All models fi t indices applied con- fi rm the model was a good fi t to the data.http://www.jard.edu.pl/tom38/zeszyt4/art_67.pdfagriculturecapital structureSouth Africa |
| spellingShingle | Joseph Chisasa SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE Journal of Agribusiness and Rural Development agriculture capital structure South Africa |
| title | SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE |
| title_full | SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE |
| title_fullStr | SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE |
| title_full_unstemmed | SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE |
| title_short | SOURCES OF GROWTH IN SOUTH AFRICAN AGRICULTURE – A CORPORATE FINANCE PERSPECTIVE |
| title_sort | sources of growth in south african agriculture 8211 a corporate finance perspective |
| topic | agriculture capital structure South Africa |
| url | http://www.jard.edu.pl/tom38/zeszyt4/art_67.pdf |
| work_keys_str_mv | AT josephchisasa sourcesofgrowthinsouthafricanagriculture8211acorporatefinanceperspective |