The Determinants of Capital Structure: Evidence from Russia

Journal of Corporate Finance Research, Vol. 11, No. 4, pp. 54-69, 2017

16 Pages Posted: 3 Apr 2019

Multiple version iconThere are 2 versions of this paper

Date Written: 2017

Abstract

The study aims to identify the capital structure determinants of the listed Russian firms. The determinants are the factors that would affect firm financial leverage. The capital structures theories and their applications are considered in the article. The study is based on a sample of 48 publicly-traded non-financial firms over the period 2009-2015. The random-effects model is employed for estimations while the OLS approach is used to measure the industry impact on capital structure. It is found that the most significant capital structure determinants of Russian firms are industry mean leverage, firm size with positive effect and growth opportunities with negative one. Profitability, non-debt tax shields and the stock market conditions with negative impact are less important. Business risk, growth opportunity measured as capital expenditures to total assets, tangibility of assets, uniqueness of assets, average tax rate, industry group of Energy firms, lending and inflation rates are irrelevant determinants. Another finding is that the Oil & Gas and Metal firms tend to have lower debt level compared to the firms from other industries.

Keywords: capital structure, leverage, capital structure determinants, panel data analysis, OLS

JEL Classification: G30, G32

Suggested Citation

Ilyukhin, Evgeny, The Determinants of Capital Structure: Evidence from Russia (2017). Journal of Corporate Finance Research, Vol. 11, No. 4, pp. 54-69, 2017. Available at SSRN: https://ssrn.com/abstract=3346250

Evgeny Ilyukhin (Contact Author)

York University ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

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