Reviewing Influential Factors on Capital Structure of Firms Listed in Tehran Security Exchange with Emphases on Production Market Competition

• Main Authors: Hosein Etemadi, Javad Montazeri
• Format: Article
• Language: fas
• Published: University of Tehran 2013-11-01
• Series: بررسی‌های حسابداری و حسابرسی
• Subjects: Product market competition; Capital structure; Static Model; dynamic model; Tehran Security Exchange
• Online Access: https://acctgrev.ut.ac.ir/article_35673_3699a23d5741732ea45bdc06f471d5b5.pdf
• ISSN: 2645-8020; 2645-8039

This study examines the relationship between product market competition and other factors affecting the capital structure of listed companies in Tehran stock exchange. The main objective of this study is to identify the effect of market competition on financial leverage (debt absorption) along with other factors affecting the company total debt absorption. Study period is 5-year from 1385 to 1389. To determine product market competition as the independent variable, Tobin’s Q ratio is used. The dependent variable used to calculate the capital structure is financial leverage ratio which is equal to total debt to total assets ratio. Other independent variables, as other effective factors on capital structure such as profitability, firm size, collateral value of assets, the company's growth, non-debt tax shields, uniqueness of assets is the ability to generate internal resources and current ratio. In this study of 178 companies (890 years - co) used as a sample and to test the research hypotheses pool/panel regression is used in both static and dynamic. Results shows that in static model, profitability effect, inventory ratio to fix assets divided by total assets and current ratio to capital structure is negative and significant and product market competition and also non debt tax shield to capital structure is positive and significant. In dynamic model, profitability effect, inventory ratio to fix assets divided by total assets and current ratio to capital structure is negative and significant and product market competition and also non debt tax shield to capital structure is positive and significant.