Capital Structure Among Latin American Companies
Abstract
This paper reports the results of an empirical study of the determinants of capital structure of large Latin American companies. Variations with regard to the country, industry, and size of a company are examined for a sample of two hundred and thirty large companies located in twentytwo Latin American countries. This study is the first to examine the capital structures of this large set of Latin American companies. The results of this study indicate that while size does not seem to be significant, both country and industry are significant determinants of capital structure in Latin America not only in bivariate tests but also in multivariate statistical tests. Multinational and diversified companies, therefore, cannot assume uniformity of capital structure across countries and industries in Latin America and, they must take these differences into account in developing and setting capital structure, financing, evaluation, and management policies for their subsidiaries.
Citation
Aggarwal, R. and Baliga, G. (1987), "Capital Structure Among Latin American Companies", Managerial Finance, Vol. 13 No. 1, pp. 3-11. https://doi.org/10.1108/eb013575
Publisher
:MCB UP Ltd
Copyright © 1987, MCB UP Limited