THEORETICAL APPROACHES ON OPTIMAL CAPITAL STRUCTURE
Journal Title: Challenges of the knowledge society ( Provocari ale societatii cunoasterii ) - Year 2019, Vol 11, Issue 13
Abstract
F. Modigliani and M. Miller demonstrated in 1958 that in the context of perfect market the financial structure of the firm does not influence its value. Since then, many researchers have approached the issue of financial structure in less restrictive hypotheses. Without reaching a consensus, they have tried to prove that the optimal capital structure exists. The goal of this article is to synthesize the literature on the financial structure and to relate the theories to known empirical evidence. The main models of the optimal financial structure belong to the agency theory, the signalling theory, the transaction cost economics and the pecking order theory. Financing decision varies according to a number of factors that may influence capital structure differently: firm profitability, dividend policy, growth opportunities, asset specificity, corporate tax shield, company size and some macroeconomic factors such as inflation rate and capital market condition.
Authors and Affiliations
Maria Zenovia GRIGORE, Mariana GURĂU
Keywords
Related Articles
- EP ID EP591027
- DOI -
- Views 158
- Downloads 0
CIVIL ACTION SETTLEMENT IN CRIMINAL PROCEEDINGS THE DANGER RELATED CRIMES
Article 1357 para. (1) Civil Code stipulates that “one that causes harm to another by an unlawful act committed with guilt is obliged to repair it”. In this study, we propose to analyze whether and to what extent, a dang...
CONSIDERATIONS REGARDING THE CHOICE, BY THE EUROPEAN INSTITUTIONS, OF THE LEGAL BASIS OF ACTS, DURING THE LEGISLATIVE PROCEDURES OVERVIEW OF THE CASE LAW OF THE COURT OF JUSTICE OF THE EUROPEAN UNION
An important moment in the conduct of legislative procedures within the European Union is located right at their onset. Thus, the initiator of an act finds himself in a position to have recourse to its legal basis, since...
THE ECJ CASE-LAW ON THE ANNULMENT ACTION: GROUNDS, EFFECTS AND ILLEGALITY PLEA
For practitioners in the field, but also for academicians it is equally important to know that there exists, under certain circumstances, the possibility of bringing an action for annulment, having as object the legally...
MANAGEMENT OF CLASSIFIED INFORMATION WITHIN THE ORGANISATION FOR INTERDICTION OF CHEMICAL WEAPONS
In the relation with international bodies, the Romanian authorities must observe its own rules related to security of confidential information, and in the relations with other authorities, branches, companies from Romani...
ORGANIZATIONAL PERFORMANCE AND LEARNING FROM THE PERSPECTIVE OF AN OPEN SYSTEM
A learning organization must be constituted in a dynamic environment of constant changes, prepared to engage and interact in systemic and systematic way with the context in which it operates. The present work intends to...