CAPITAL STRUCTURE AND FINANCIAL CRISIS: EVIDENCE USING GMM ESTIMATION

Year 2021, Volume: 4 Issue: 2, 163 - 178, 13.02.2022

Mohamed Makaran

https://doi.org/10.55065/intraders.1037171

Abstract

Abstract
The Financial crisis (FC) displayed a crucial impact on the financial markets, incredibly decreasing security issuance by companies. A standout amongst the outcome of the interruption of the capital furthermore lending markets created by financial crisis might have been enhancing the level of debt in firm capital structures. Therefore, this paper uses Dynamic Panel Data (GMM) Estimator in order to investigate the impact financial crisis on capital structure over a sample of 15 cement firms that are recorded on Istanbul Stock Exchange from 2005 to 2015. Financial debt is utilized as evaluation of dependent variables (DV) while, Size, Growth, Tangibility and Profitability are used in assessment of independent variables (IV).
The results indicate that there is connection between firm’s capital structure and financial crisis. Furthermore; the results express that firm size, tan, growth, NDTS are positive associated with leverage while profitability and leverage are negatively related.

Keywords

Keywords: Capital Structure, Leverage, Liquidity, Financial Crisis, and Cement Companies.

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