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ИД «Финансы и кредит»






Finance and Credit

Formation of optimal capital structure of domestic corporations in times of crisis: Econometric analysis of determinants

Vol. 29, Iss. 4, APRIL 2023

Received: 13 January 2020

Received in revised form: 20 January 2020

Accepted: 31 January 2020

Available online: 27 April 2023

Subject Heading: BUSINESS VALUE

JEL Classification: E22, E44, F6, F15

Pages: 910–937


Valeriya V. METEL'SKAYA Kuban State University (KubSU), Krasnodar, Russian Federation


Subject. The article addresses building the optimal capital structure in the face of financial globalization, taking into account the ever-changing factors of external economic and geopolitical environment, including the financial crisis.
Objectives. The purpose is to perform empirical tests of hypotheses about the nature of corporate financial leverage dependence on traditional determinants during and after the financial crisis in Russia's emerging market. I used a large data set on 49 public companies in seven leading sectors of the Russian economy from 2011 to 2017.
Methods. The study employs the correlation and regression analysis.
Results. The results of correlation and regression analysis show that the application of traditional theories of capital structure in the current conditions of financial globalization in a developing country is ineffective for forming an optimal capital structure; macroeconomic factors have a significant impact on the formation of corporate capital structures, which is particularly reflected during and after the crisis; the financial crisis has a considerable impact on the capital structure of companies; the determinant of stock market development has a real impact on leverage and plays an important role in financial decision-making after the financial crisis.
Conclusions. I revealed inverse relationship between the leverage and variable size of companies after financial crisis, which contradicts to the trade-off theory and corresponds to the pecking order theory. This supports the hypothesis that macroeconomic factors are crucial, but the variable of stock market development has increased essentially as compared to the pre-crisis period.

Keywords: leverage, capital structure, trade-off theory, pecking order theory, stock market


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