Speed of adjustment of capital structure: empirical study

• Ano de defesa: 2015
• Autor(a) principal: Lopes, Natalia Cristina
• Orientador(a): Mergulhão, João de Mendonça
• Tipo de documento: Dissertação
• Tipo de acesso: Acesso aberto
• Idioma: eng
• Palavras-chave em Português: Corporate finance; Capital structure; Finanças corporativas; Velocidade de ajustamento
• Palavras-chave em Inglês: Adjustment speed; Macroeconomic variables
• Link de acesso: http://hdl.handle.net/10438/13493

We analyze the impact of firm-specific characteristics as well as economic factors on the speed of adjustment to the target debt ratio. Using different methods, we document speeds of adjustment ranging from 14.4% to 37%. The results indicate that the speed of adjustment is affected by business-cycle variables: The interaction term related to term spread reveals, as expected, faster adjustment in booms than in recessions and a negative relationship between short term spread and adjustment speed. We also show that the speed of adjustment becomes stationary when the increasing fractions of zero-debt firms are considered.