What determines leverage in selected countries of Central and Eastern Europe in the automotive industry

Petra Růčková, Nicole Skuláňová
2020 Journal of administrative and business studies  
Keywords Abstract Financial structure Pro itability Liquidity Non-debt tax shield Asset structure GDP In lation Interest rate The subject of this article is to analyse the inancial structure of companies belonging to the second and third sector. The issue of sources of funding is one of the fundamental decisions of inancial managers and has been a much-debated topic in the last century. A number of studies have been written throughout this period, but there is still no consensus, and there is
more » ... ill a need to expand this area with new knowledge for other countries and sectors. The analysis covers medium and large companies engaged in automotive industry and is located in eleven selected countries including the Visegrad France. The period under review is between 2010 and 2018. The input data come from the Orbis and World Bank database. The research deals with the impact of pro itability, liquidity, asset structure, non-debt tax shield, GDP, in lation and basic interest rate on the total, long-term and short-term debt of companies. Panel regression using the GMM method is used to determine the impact of individual factors on debt levels. The main conclusion of the research is that companies in both sectors are mainly affected by the determinants of the external environment, most of all by changes in interest rates. This research builds on existing knowledge and seeks to disseminate it by focusing on speci ic sectors. From a practical point of view, the results of the research could help companies from the researched sector to optimize their sources of inancing with regard to the in luence of external determinants, which proved to be more signi icant.
doi:10.20474/jabs-6.5.5 fatcat:h2a5gbavazaslkwvr53zhvprwm