Capital Structure Volatility and the Role of Macroeconomic Variables ‎‎(Evidence From the Companies Listed on the Tehran Stock Exchange)‎

Document Type : Scientific-research

Authors

1 PhD student in Financial Engineering, Faculty of Management, Yazd University

2 Associate Professor, Faculty of Economics, Management and Accounting, Yazd University

Abstract

Volatility in companies’ capital structure has disrupted managers’ concentration required to ‎create, maintain, and increase return and, consequently, attempts to improve the company’s ‎performance. One of the managers’ tasks is to decide on an appropriate mix of financial resources ‎of the company, i.e., the capital structure. This research aims to study the role of macroeconomic ‎variables in the capital structure volatility for companies listed on the Tehran Stock Exchange. ‎The sample consisted of 89 companies listed in the Tehran Stock Exchange during the period ‎‎2014-2018, chosen by the systematic random sampling method. The results indicate that the ‎volatility of the short-term and long-term debt structure increases with an increase in the inflation ‎rate. Moreover, the volatility decreases as the interest rate increase. Furthermore, the long-term ‎debt structure of the companies rises slightly as the economic growth rate increases.‎

Keywords


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