EconPapers    
Economics at your fingertips  
 

The relationship between capital structure and ownership structure: New evidence from Jordanian panel data

Basil Al-Najjar and Peter Taylor

Managerial Finance, 2008, vol. 34, issue 12, 919-933

Abstract: Purpose - The study aims to investigate the comparatively under-researched relationship between ownership structure and capital structure in an emerging market. It is also one of the first studies to apply both single and reduced-form equation methods using a panel data approach. Findings - The results demonstrate that Jordanian firms follow the same determinants of capital structure as occur in developed markets, namely: profitability, firm size, growth rate, market-to-book ratio, asset structure and liquidity. In addition, institutional ownership structure is found to be determined by: assets structure, business risk (BR), growth opportunities and firm size. Finally, the results reveal that assets tangibility, firm size, growth opportunities and BR are considered to be joint determinants of ownership structure and capital structure. Practical implications - The practical implication of the study is that investors and managers should consider both capital structure and ownership structure when they take their investment decisions. Originality/value - This is the first study of the interaction between institutional ownership and capital structure in Jordan where there are differences, as regards institutional and financial structures, relative to those in developed markets.

Keywords: Corporate ownership; Capital structure; Jordan (search for similar items in EconPapers)
Date: 2008
References: Add references at CitEc
Citations: View citations in EconPapers (19) Track citations by RSS feed

Downloads: (external link)
http://www.emeraldinsight.com/10.1108/030743508109 ... RePEc&WT.mc_id=RePEc (text/html)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:mfipps:v:34:y:2008:i:12:p:919-933

Ordering information: This journal article can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://emeraldgroupp ... s/journals.htm?id=mf

Access Statistics for this article

Managerial Finance is currently edited by Professor Don T Johnson

More articles in Managerial Finance from Emerald Group Publishing
Bibliographic data for series maintained by Virginia Chapman ().

 
Page updated 2020-03-29
Handle: RePEc:eme:mfipps:v:34:y:2008:i:12:p:919-933