Examining the Concurrent Effects of Specific Corporate Traits and Macroeconomic Variables on Capital Structure

Abstract

The main purpose of this study is to investigate the effects of the specific characteristics of the company and the macroeconomic variables on the capital structure of the companies accepted in the Tehran Stock Exchange between 2007 and 2014 using the panel data approach. To measure specific characteristics of a company, the profitability ratio, payable dividends ratio and the stock price performance ratio were applied; also, variables such as GDP growth rate, exchange rate, inflation rate, interest rate and the ratio of the amount of bank credits as macroeconomic variables have been employed. The results of this research showed that in the whole industry, the variables of profitability ratio, the payable dividends ratio and the ration of the amount of bank credits have a negative and significant effect, and GDP growth rate has a positive and significant effect on capital structure. Similarly, the results show that the effects of specific corporate variables differ from macroeconomic variables on capital structure according to the type of industry.