A study about the determinant factors of the capital structure of Brazilian companies: a quantile regression analysis

Abstract

Purpose: The present paper aims to analyses the determinants of capital structure of ninety-four organizations from the five hundred largest Brazilian companies according to 2018 Exame magazine yearbook. Methodology: For this research we used information from financial statements of the five hundred largest Brazilian companies. Data inference was made through descriptive statistical analysis and quantile regression analysis. The data was obtained through the companies’ websites and through economática software. The descriptive and econometric analysis were performed using Stata 12 software. Results: The results indicate that the variables such as size and structure of the assets are significant in some quantiles to determine how companies adopt a particular capital structure. In addition, the results indicate the relationship between firm size and total debt level is positive for 25th quantile of the sample. Another point to note is that the asset structure variable has a positive relationship with the long-term debt variable for the 75th and 95th quantiles. Contributions of the study: This research is an important contribution for finance literature considering that the quantile regression method was used. The scarcity of research using this method is notorious. Moreover, the results obtained in other works on the subject are not yet convergent about the relevant variables to determine the capital structure.

Keywords

• capital structure; quantile regression; indebtedness; third-part capital; owner capital.