Determinants of Funding Sources of Capital – A Sectored Approach in Brazil

18 Pages Posted: 22 Nov 2014

See all articles by Marcos Alves da Silva

Marcos Alves da Silva

Universidade Federal de Uberlândia

Mario Kuniy

Mackenzie Presbyterian University

Wilson Toshiro Nakamura

Mackenzie Presbiterian University - PPGAE

Date Written: November 21, 2014

Abstract

The study of sources of capital financing of companies has been the focus for researchers empirically test theories of capital structure. Identify an optimal capital structure (if any!) is no easy task, due to the dependence of several dynamic variables; temporal and sectored. So the consensus seems distant, representing an interesting field of study. The objective of this work is to analyze the variables determining the capital structure of Brazilian non-financial companies within sectored scopes, in the period 1998-2013, using the Brazilian Database (Macrodados Sistemas Gerenciais). To design such revision of the most robust theories related to the capital structure are Pecking Order Theory (POT) and Trade-Off Theory (TOT). This work innovates in addressing the segmented view of business performance. It was found that 55.6% of the variation can be explained by variables included in the model . With the fixed effects model with dummy variables and White’s robust correction, it appears that the various observations are statistically different across sectors. This finding reinforces the idea of the importance of the approach to the industry for the study of Capital Structure. Each sector has specific characteristics that lead to the composition of different sources of funding.

Keywords: Sectored Indicators of Business Performance, Pecking Order Theory, Trade-Off Theory

JEL Classification: G10, G30

Suggested Citation

Alves da Silva, Marcos and Kuniy, Mario and Nakamura, Wilson Toshiro, Determinants of Funding Sources of Capital – A Sectored Approach in Brazil (November 21, 2014). Available at SSRN: https://ssrn.com/abstract=2529127 or http://dx.doi.org/10.2139/ssrn.2529127

Marcos Alves da Silva (Contact Author)

Universidade Federal de Uberlândia ( email )

Av. João Naves de Avila, 2121
Uberlândia, Minas Gerais 38400-902
Brazil

Mario Kuniy

Mackenzie Presbyterian University ( email )

lucas.jr@ericsson.com
São Paulo

Wilson Toshiro Nakamura

Mackenzie Presbiterian University - PPGAE ( email )

Rua da Consolacao, 896 - 5o. andar
01302-907 Sao Paulo
Brazil
+55 11 236 8669 (Phone)
+55 11 236 8600 (Fax)

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