Home  Journals  Financial Analytics: Science and Experience  5(335) - 2017 May

A research into the effect of internal and external factors on the capital structure at various stages of the Russian companies' lifecycle

Vol. 10, Iss. 5, MAY 2017

Article PDF Version

Received: 3 February 2017

Received in revised form: 20 February 2017

Accepted: 28 February 2017

Available online: 15 May 2017

Subject Heading: ECONOMIC AND STATISTICAL RESEARCH

JEL Classification: D24

Pages: 482-492

https://doi.org/10.24891/fa.10.5.482

Importance The article studies micro- and macroeconomic determinants of the structure of the Russian public companies’ capital. We also focus on the effect and significance of regressors on the leverage of companies at various stages of lifecycle.
Objectives The research examines how the capital structure depends on internal variables, which indirectly relate to the company, and external ones, which result from the State policy and other aspects. We show that various regressors influence the capital structure at different stages of corporate lifecycle. Considering multicollinearity, the research is to find as much explained variables as possible that make the model more predictive.
Methods We applied the Anthony–Ramesh coefficient method to split companies into groups by lifecycle stage. The model is based on the multiple regression.
Results The economy and companies were found to be influenced by key macroeconomic indicators, which depended on Gross Domestic Product and supplement it. As for various methods for identifying the corporate lifecycle, only some methods involve reporting data, rather than methods based on estimates and judgments of experts. The article overviews principal micro- and macroeconomic determinants of the capital structure used in the Russian and foreign researches. We also found what aspects were significant for the Russian market at various stages of the lifecycle. The article proposes levers to steer the capital structure through internal factors and the model for forecasting the effect of external factors.

Keywords: capital structure, macroeconomic factor, microeconomic factor, corporate lifecycle, unconventional determinant

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