DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS

Leverage ratio is the ratio which indicates what percentage of firms’ assets are subsidized through foreign assets. Besides, it can be an indicator of firms’ risk degrees. Particularly when the leverage ratio is high, the risk degree of firms increases. On the other hand, this ratio can be an indica...

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Autores principales:	İsmail TUNA, Serdar BUDAK, Sibel ÖLMEZ CANGİ, Veysel YILMAZ
Formato:	article
Lenguaje:	DE EN FR TR
Publicado:	Fırat University 2019
Materias:	leverage ratio, capital structure, macroeconomic variables, bist industry, ardl Social Sciences H Social sciences (General) H1-99
Acceso en línea:	https://doaj.org/article/975f9dd6e4304461baf259f77fe23864
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spelling	oai:doaj.org-article:975f9dd6e4304461baf259f77fe238642021-11-24T09:20:43ZDETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS2148-416310.9761/JASSS7345https://doaj.org/article/975f9dd6e4304461baf259f77fe238642019-08-01T00:00:00Zhttps://jasstudies.com/index.jsp?mod=tammetin&makaleadi=831383284_24-Yrd.%20Do%C3%A7.%20Dr.%20%C4%B0smail%20Tuna.pdf&key=28551https://doaj.org/toc/2148-4163Leverage ratio is the ratio which indicates what percentage of firms’ assets are subsidized through foreign assets. Besides, it can be an indicator of firms’ risk degrees. Particularly when the leverage ratio is high, the risk degree of firms increases. On the other hand, this ratio can be an indicator of the return on equity by the leverage effect. So as to assess the effect of the macroeconomic variables on the leverage ratio which includes such significant data about the firms, 126 manufacturing industry firms listed in ISE, active between the years of 2003-2013 and excluded from the financial sector and holdings of which data could be reached has been included in this study. Macroeconomic variables (producer price index (PPI), interest rate (interest of government debt securities), industrial production index and exchange rate (USD)) have been included in the model as the independent variables, while the leverage ratios of the 126 firms (total foreign assets/total assets) have been taken as the dependent variables. In the study, in which the quarterly data have been used, primarily, augmented Dickey-Fuller (ADF) and Phillips Perron (PP) unit root tests have been applied. Thus, it has been determined whether the variables are stable at the same level. In order to obtain the information about the short and long term parameters, the bound test and autoregressive distributed lag model (ARDL), which were defined in Pesaran and Shin’s (1999) as well as Pesaran, Shin and Smith’s (2001) studies, have been applied. At this point, that the coefficient of error correction term is positive means the model digresses the balance, and conversely, that it is negative means the model approaches the balance. According to the bound test F statistics applied to the model set up in the findings section of the study, it has been concluded that a cointegration relation may exist at 1% level. As for the ARDL test results, it has been found that there is a positive cointegration relation between the leverage ratio and producer price index (PPI) as well as the industrial production index.İsmail TUNASerdar BUDAKSibel ÖLMEZ CANGİVeysel YILMAZFırat Universityarticleleverage ratio, capital structure, macroeconomic variables, bistindustry, ardlSocial SciencesHSocial sciences (General)H1-99DEENFRTRJournal of Academic Social Science Studies , Vol 10, Iss 63, Pp 331-340 (2019)
institution	DOAJ
collection	DOAJ
language	DE EN FR TR
topic	leverage ratio, capital structure, macroeconomic variables, bist industry, ardl Social Sciences H Social sciences (General) H1-99
spellingShingle	leverage ratio, capital structure, macroeconomic variables, bist industry, ardl Social Sciences H Social sciences (General) H1-99 İsmail TUNA Serdar BUDAK Sibel ÖLMEZ CANGİ Veysel YILMAZ DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS
description	Leverage ratio is the ratio which indicates what percentage of firms’ assets are subsidized through foreign assets. Besides, it can be an indicator of firms’ risk degrees. Particularly when the leverage ratio is high, the risk degree of firms increases. On the other hand, this ratio can be an indicator of the return on equity by the leverage effect. So as to assess the effect of the macroeconomic variables on the leverage ratio which includes such significant data about the firms, 126 manufacturing industry firms listed in ISE, active between the years of 2003-2013 and excluded from the financial sector and holdings of which data could be reached has been included in this study. Macroeconomic variables (producer price index (PPI), interest rate (interest of government debt securities), industrial production index and exchange rate (USD)) have been included in the model as the independent variables, while the leverage ratios of the 126 firms (total foreign assets/total assets) have been taken as the dependent variables. In the study, in which the quarterly data have been used, primarily, augmented Dickey-Fuller (ADF) and Phillips Perron (PP) unit root tests have been applied. Thus, it has been determined whether the variables are stable at the same level. In order to obtain the information about the short and long term parameters, the bound test and autoregressive distributed lag model (ARDL), which were defined in Pesaran and Shin’s (1999) as well as Pesaran, Shin and Smith’s (2001) studies, have been applied. At this point, that the coefficient of error correction term is positive means the model digresses the balance, and conversely, that it is negative means the model approaches the balance. According to the bound test F statistics applied to the model set up in the findings section of the study, it has been concluded that a cointegration relation may exist at 1% level. As for the ARDL test results, it has been found that there is a positive cointegration relation between the leverage ratio and producer price index (PPI) as well as the industrial production index.
format	article
author	İsmail TUNA Serdar BUDAK Sibel ÖLMEZ CANGİ Veysel YILMAZ
author_facet	İsmail TUNA Serdar BUDAK Sibel ÖLMEZ CANGİ Veysel YILMAZ
author_sort	İsmail TUNA
title	DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS
title_short	DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS
title_full	DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS
title_fullStr	DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS
title_full_unstemmed	DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS
title_sort	determining the effects of macroeconomic variables on firms’ leverage ratios
publisher	Fırat University
publishDate	2019
url	https://doaj.org/article/975f9dd6e4304461baf259f77fe23864
work_keys_str_mv	AT ismailtuna determiningtheeffectsofmacroeconomicvariablesonfirmsleverageratios AT serdarbudak determiningtheeffectsofmacroeconomicvariablesonfirmsleverageratios AT sibelolmezcangi determiningtheeffectsofmacroeconomicvariablesonfirmsleverageratios AT veyselyilmaz determiningtheeffectsofmacroeconomicvariablesonfirmsleverageratios
_version_	1718415624951037952

DETERMINING THE EFFECTS OF MACROECONOMIC VARIABLES ON FIRMS’ LEVERAGE RATIOS

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