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A Panel Data Analysis of Capital Structure Determinants: An Empirical Study of Non-Financial Firms in Oman

Author

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  • Dharmendra Singh

    (Department of Business and Economics, Modern College of Business and Science, Oman.)

Abstract

The aim of this research paper is to examine the firm-specific determinants of the capital structure for non-financing companies of Oman. Based on the existing literature and theories of capital structure, the probable determinants of capital structure are identified. The analysis is performed using panel data techniques; fixed and random effects, for a sample of 61 companies listed on the Muscat Securities Market during 2011-2015. The results suggest that tangibility, profitability and liquidity are having negative relationship with the leverage, whereas firm size and growth opportunity are positively related to the leverage. Non-debt tax shields do not appear to be significantly related to leverage of Omani firms. Pecking order theory is most successful in explaining the determinants of capital structure of the Omani companies. The results of this paper suggest that findings are consistent with the capital structure studies on other developed and developing countries. The study has important policy implications for the finance managers of the firms in Oman.

Suggested Citation

  • Dharmendra Singh, 2016. "A Panel Data Analysis of Capital Structure Determinants: An Empirical Study of Non-Financial Firms in Oman," International Journal of Economics and Financial Issues, Econjournals, vol. 6(4), pages 1650-1656.
    • Handle: RePEc:eco:journ1:2016-04-48
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    Citations

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    Cited by:

    1. Fauzi Thalib & Herdiyana Herdiyana & Ayi Wahid, 2019. "Tax and not Tax on Capital Structure of Real Estate and Property Company," International Journal of Economics and Financial Issues, Econjournals, vol. 9(2), pages 87-95.
    2. Maciej Stradomski & Katarzyna Schmidt, 2020. "Firm specific determinants of capital structure in European advanced developing countries," Bank i Kredyt, Narodowy Bank Polski, vol. 51(3), pages 263-292.
    3. Kanika Sachdeva & Abhishek Agarwal, 2023. "Factor influencing leveraging decision of Indian companies: evidence from panel data analysis," International Journal of Business and Globalisation, Inderscience Enterprises Ltd, vol. 35(1/2), pages 134-146.
    4. Hana Bawazir & Anis Khayati & Fatema AbdulMajeed, 2021. "Corporate governance and the performance of non-financial firms: the case of Oman," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 8(4), pages 595-609, June.
    5. Endri Endri & Bob Mustafa & Oscar Rynandi, 2019. "Determinants of Debt Policy of Real Estate and Property Companies Listed on the Indonesia Stock Exchange," International Journal of Economics and Financial Issues, Econjournals, vol. 9(2), pages 96-104.

    More about this item

    Keywords

    Leverage; Determinants; Capital Structure; Oman;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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