In this paper, we examine the relationship between political risk as an international environmental determinant of capital structure as well as other factors that contribute to capital structure including leverage, foreign exchange risk, agency costs of debt, and collateral value of assets. We conducted this research on a sample of 200 Singaporean, non-financial, listed domiciled multinational firms over the period of 2005 to 2009. The results suggest that political risk is irrelevant to the multinational capital structure, foreign exchange risk, agency costs of debt, and (netted) collateral value of assets. We find that the results remain unchanged after controlling for size and industry. The findings produce evidence that foreign exchange risk, as another international factor is also irrelevant to the Singaporean multinational capital structure choice. Additionally, agency costs of debt and (netted) fixed assets have a negative association with leverage for Singaporean multinational corporations.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:umu-45273 |
| Date | January 2011 |
| Creators | Rasaei, Janet, Nguyen, Kim |
| Publisher | Umeå universitet, Handelshögskolan vid Umeå universitet, Umeå universitet, Handelshögskolan vid Umeå universitet |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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