TY - JOUR
T1 - The determinants of capital structure
T2 - Evidence from China
AU - Huang, Guihai
AU - Song, Frank M.
N1 - Funding Information:
We thank Chong-en Bai, Chun Chang, Joe Lu, Keith Wong, Jack Zhang, the anonymous referee and participants in the economics and finance workshop held at the University of Hong Kong, at the conference on China and World in the 21st Century held at Hong Kong Baptist University, and at the 14th Association for Chinese Economic Studies (ACES) Annual Conference held at the University of Sydney for helpful comments and Xia Li for excellent research assistance. We also thank Tom Hughes Wilhelm at MUST for editing assistance. The paper is partially funded by grants from Shanghai Stock Exchange. Guihai Huang also acknowledges the financial support of an HKU-PRC Swire doctoral scholarship and a research grant given by the Macao Foundation in 2004.
PY - 2006
Y1 - 2006
N2 - This paper employs a new database containing the market and accounting data (from 1994 to 2003) from more than 1200 Chinese-listed companies to document their capital structure characteristics. As in other countries, leverage in Chinese firms increases with firm size and fixed assets, and decreases with profitability, non-debt tax shields, growth opportunity, managerial shareholdings and correlates with industries. We also find that state ownership or institutional ownership has no significant impact on capital structure and Chinese companies consider tax effect in long-term debt financing. Different from those in other countries, Chinese firms tend to have much lower long-term debt.
AB - This paper employs a new database containing the market and accounting data (from 1994 to 2003) from more than 1200 Chinese-listed companies to document their capital structure characteristics. As in other countries, leverage in Chinese firms increases with firm size and fixed assets, and decreases with profitability, non-debt tax shields, growth opportunity, managerial shareholdings and correlates with industries. We also find that state ownership or institutional ownership has no significant impact on capital structure and Chinese companies consider tax effect in long-term debt financing. Different from those in other countries, Chinese firms tend to have much lower long-term debt.
KW - Capital structure
KW - China capital market
KW - State owned enterprises
KW - Tax effect
UR - http://www.scopus.com/inward/record.url?scp=33644600454&partnerID=8YFLogxK
U2 - 10.1016/j.chieco.2005.02.007
DO - 10.1016/j.chieco.2005.02.007
M3 - Article
AN - SCOPUS:33644600454
SN - 1043-951X
VL - 17
SP - 14
EP - 36
JO - China Economic Review
JF - China Economic Review
IS - 1
ER -