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Publication
The impact of family control on capital structure on emerging economies
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| 1.24 MB | Adobe PDF |
Advisor(s)
Abstract(s)
Family firms are the leading pillar of the economy in most emerging and developed economies, representing between 60% to 90% of non-governmental gross domestic product (GDP). Therefore, Family firms’ decisions about their capital structure have a significant weight on a country’s economy, and the study on how the determinants of capital structure is affected by family firms’ decisions has become an important research topic. However, so far, despite the significant expansion of firms from emerging countries in recent years, the studies regarding Latin American family firms are limited. Therefore, the work examined how family governance-related factors impacts capital structure decisions in multinationals firms from Latin America, and how the board of directors and female presence within the board can influence its effect. The work is empirically tested by an unbalanced data panel model using the Generalized Method of Moments (GMM) system of 85 firms from six Latin American countries for the period 2011-2021. The capital structure determinants results were mostly mixed, with family firm control showing a mostly positive effect on the levels of indebtedness, while Gender Diversity showed the contrary effect. Macroeconomic factors demonstrated that they impact the capital structure in emerging economies.
Description
Keywords
Capital structure Family firms Emerging economies Board of directors Gender diversity