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Summary Of Theories In Capital Structure Decisions

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  • Herczeg Adrienn

    (Univrsity of Debrecen,)

Abstract

Defining the optimal capital structure is a critical decision for any organization. This decision is important not only because of the need to maximize returns, but also because of the impact such a decision has on an organization's ability to deal with its competitive environment. There are many theories for this theme, but all the same, researchers have not found the optimal capital structure. In Hungary the capital structure of enterprises changed significantly since 1990, but it is true, that their decisions about the capital can not fit with neither theoretical appeal totally. There is no universal theory of the debt-equity choice, and no reason to expect one.

Suggested Citation

  • Herczeg Adrienn, 2014. "Summary Of Theories In Capital Structure Decisions," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 912-918, July.
    • Handle: RePEc:ora:journl:v:1:y:2014:i:1:p:912-918
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    File URL: http://anale.steconomiceuoradea.ro/volume/2014/n1/100.pdf
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    References listed on IDEAS

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    1. Hovakimian, Armen & Opler, Tim & Titman, Sheridan, 2001. "The Debt-Equity Choice," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 36(1), pages 1-24, March.
    2. Stulz, ReneM., 1990. "Managerial discretion and optimal financing policies," Journal of Financial Economics, Elsevier, vol. 26(1), pages 3-27, July.
    3. Fama, Eugene F., 1984. "The information in the term structure," Journal of Financial Economics, Elsevier, vol. 13(4), pages 509-528, December.
    4. Diamond, Douglas W, 1989. "Reputation Acquisition in Debt Markets," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 828-862, August.
    5. Malcolm Baker & Jeffrey Wurgler, 2002. "Market Timing and Capital Structure," Journal of Finance, American Finance Association, vol. 57(1), pages 1-32, February.
    6. Harris, Milton & Raviv, Artur, 1988. "Corporate control contests and capital structure," Journal of Financial Economics, Elsevier, vol. 20(1-2), pages 55-86, January.
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    Cited by:

    1. Marcin Kedzior & Barbara Grabinska & Konrad Grabinski & Dorota Kedzior, 2020. "Capital Structure Choices in Technology Firms: Empirical Results from Polish Listed Companies," JRFM, MDPI, vol. 13(9), pages 1-20, September.

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    More about this item

    Keywords

    capital structure; theories;

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General

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