Advanced Search
MyIDEAS: Login

Investigation of Target Capital Structure for Electronic Listed Firms in Taiwan

Contents:

Author Info

  • Chien-Chung Nieh
  • Hwey-Yun Yau
  • Wen-Chien Liu
Registered author(s):

    Abstract

    This paper investigates the existence of an optimal debt ratio for the electronic listed firms in Taiwan, using balanced panel data for a sample of 143 selected electronics companies listed in the Taiwan Stock Exchange (TSE) from the first quarter of 1999 to the third quarter of 2004. The result shows that there is a single threshold effect of debt ratio on firm value when return on equity (ROE) is used to proxy firm value. Furthermore, based on our combined findings of ROE and earnings per share (EPS) triple threshold estimations, we find that the appropriate debt ratio range for the electronic listed firms in Taiwan should not be over 51.57 percent or below 12.37 percent. To ensure and enhance the firm's value, the optimal range of debt ratio should be within 12.37 percent and 28.70 percent. The implications of the findings for financial managers and shareholders' welfare are discussed.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://mesharpe.metapress.com/link.asp?target=contribution&id=62L50574674R1112
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by M.E. Sharpe, Inc. in its journal Emerging Markets Finance and Trade.

    Volume (Year): 44 (2008)
    Issue (Month): 4 (July)
    Pages: 75-87

    as in new window
    Handle: RePEc:mes:emfitr:v:44:y:2008:i:4:p:75-87

    Contact details of provider:
    Web page: http://mesharpe.metapress.com/link.asp?target=journal&id=111024

    Related research

    Keywords: capital structure; debt-to-assets ratio; firm value; panel threshold effect;

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:mes:emfitr:v:44:y:2008:i:4:p:75-87. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Nguyen).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.