Journal of Economics, Business, & Accountancy Ventura
Vol. 23 No. 1 (2020): April - July 2020

The Effect of Corporate Characteristics on Capital Structure in Indonesia

Albart, Nicko (Unknown)
Sinaga, Bonar Marulitua (Unknown)
Santosa, Perdana Wahyu (Unknown)
Andati, Trias (Unknown)



Article Info

Publish Date
30 Jul 2020

Abstract

This study aims to determine the effect of corporate characteristics on the company's capital structure, which plays a fundamental role in the proportion of debt and equity financing risks. The research method used is purposive sampling. This research's population is non-financial issuers listed on the Indonesia Stock Exchange with quarterly data for the period of 2010-2017. The analysis is performed using panel data with six independent variables and two control variables. The results of this study indicate that profitability and institutional ownership have a negative effect on capital structure. In contrast, market ratios, firm size, and managerial ownership have a positive effect on capital structure. Debt decision making must consider financial and ownership characteristics, especially if there is institutional or government ownership in the company because company characteristics have a significant effect on the company's capital structure.

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Journal Info

Abbrev

jebav

Publisher

Subject

Economics, Econometrics & Finance

Description

Journal of Economics, Business and Accountancy (JEBAV) addresses economics, business, banking, management and accounting issues that are new developments in business excellence and best practices, and methodologies to determine these in manufacturing and financial service organisations. It considers ...