The Determinants of Capital Structure in a Tax Free Environment: An Extreme Bounds Analysis

No Thumbnail Available
Issue Date
2012
Authors
Moosa, Imad
Sbeiti, Wafaa
Keywords
Type
Journal Article
Peer-Reviewed
Abstract
Extreme bounds analysis is used to identify the determinants of capital structure in a tax-free environment, using data from Oman. The results show some evidence for the importance of liquidity, tangibility, growth opportunities and stock price performance. The findings are more supportive of the pecking order theory than the trade-off theory, but in general they imply that the capital structure decision does matter, even in the absence of taxes.
Citation
External link