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Contaduría y administración

Print version ISSN 0186-1042


GUTIERREZ PONCE, Herenia; MORAN MONTALVO, Christian  and  POSAS MURILLO, Ricardo. Determinants of capital structure: an empirical study of the manufacturing sector at Ecuador. Contad. Adm [online]. 2019, vol.64, n.2.  Epub Dec 10, 2019. ISSN 0186-1042.

The objective of this study is to discover the determinants of the capital structure of 304 companies in the manufacturing sector of Guayaquil, during the period 2012-2016 and which theory best condenses the financing decisions of companies. The importance of it lies in verifying the determinants of indebtedness in companies in a developing country and comparing the results with the predictions of the Trade-off and the Pecking Order theories. As a methodology, a panel data structure has been used together with a fixed effects model. After reviewing the literature, an Ordinary Least Squares regression model was used to discover the correlation and statistical significance between the dependent variable (debt ratio) and a set of selected independent variables. In this study, the Pecking Order theory had a greater explanatory power than the Trade-off theory. However, no statistical evidence was found to support the importance of growth expectations on the corporate capital structure.

Keywords : G32; C12; Financing; capital structure; manufacturing; leverage; Trade-off; Pecking Order.

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