The Empirical Research For The Influence Factors Of Capital Structure

Based on the empirical research of previous scholars on the capital structureinfluence factors, this paper summed up the three-levels relatively importantinfluence factors—macro environment, industry environment, companycharacteristic factors, and formed multi-level system of capital structureinfluencing factors. This system can not only explore how the factors influence thecapital structure, but also found the influence between various factors. Theapplication of structure equation model has to be able to realize the researchpurpose, it combines regression analysis, factor analysis, path analysis andmultivariate variance analysis, it is more comprehensive than the factor analysis ininfluencing factor of capital structure. In addition, the research of industryenvironment factors is based on the industry life cycle, and has a qualitativeanalysis by using strategic financial knowledge.The empirical results show that the company characteristic factors are the decisivepower of leading to capital structure adjustment, the change of externalenvironment factors is also performed on the company level, causing theadjustment and change of the capital structure. The debt shield, company scale andgrowth affect the capital structure positively, profitability and volatility negativelyaffect the capital structure. Industry life cycle through company characteristicfactors such as profitability, growth and firm scale positively affects the capitalstructure decision, macroeconomic fluctuation through the industry and companylevel such as volatility negatively affects the capital structure decision.