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Financial Risk Study of the Construction Sector SMEs

Author

Listed:
  • Nicoleta BARBUTA-MISU

    (Faculty of Economics and Business Administration, Dunarea de Jos University of Galati, Romania.)

Abstract

The importance given to the problem of capital structure comes from the influence of debts on return on equity and the financial risk induced by debts. This paper is actually an analysis of the evolution of financial risk on the construction sector during 2001 – 2011 on a sample of 11 enterprises in the Galati County – Romania. To carry out this study were used two methods, rely on breakeven point and leverage effect. The study of aggregate data reveal a low fluctuating trend of financial risk, which shows that by the end of 2008 the effects of the economic and financial crisis still have not felt as much as is shown starting with 2009. The conclusion that emerges in this study is that the world crisis produced major effects on construction sector, but they could be seen a little bit later before the onset of it. The effects are disastrous for economy (lack of work, offs of staff etc.), which is why the government began to seek solutions to relaunch this sector.

Suggested Citation

  • Nicoleta BARBUTA-MISU, 2012. "Financial Risk Study of the Construction Sector SMEs," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 3, pages 31-38.
    • Handle: RePEc:ddj:fseeai:y:2012:i:3:p:31-38
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    File URL: http://www.ann.ugal.ro/eco/Doc2012.3/Barbuta-Misu.pdf
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    References listed on IDEAS

    as
    1. Augustin Landier & David Sraer & David Thesmar, 2009. "Financial Risk Management: When Does Independence Fail?," American Economic Review, American Economic Association, vol. 99(2), pages 454-458, May.
    2. Barbuta Misu, Nicoleta, 2009. "Modelling the Financial Performance of the Building Sector Enterprises – The case of ROMANIA," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 195-212, December.
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    Cited by:

    1. Gratiela Dana BOCA & Lindita MUKAJ, 2016. "Barriers in Sustainable Knowledge Management Model in Education," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 3, pages 19-28.

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    More about this item

    Keywords

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    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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