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- Comparison of static models in optimization of the determinants of the Portuguese SME capital structurePublication . Lourenco, Antonio; Mata, Mário Nuno; Arsénio, TiagoPurpose: This research aims to study the determinants of Portuguese companies’ capital structure. These results can be useful: 1) as guidelines for capital structure optimization and 2) as a support for efficient decisions in what concerns to capital structure. The literature shows that classical determinants of capital structure present statistical significance and pursue the expected sign for different econometric models tested. Method: The study follows a quantitative design research, with data collected in Amadeus from 500 SME`S in Portugal. The data spans from 2009 to 2018 totaling 4500 observations. We consider three dependent variables, i.e., total, medium and long term and short-term debt. In addition, we also employ seven independent variables (dimension; growth; liquidity; profitability; tangibility; profitability and business risk and singularity). We used a panel data approach based on fixed effects (FE) and of random effects models (RE). Findings: We found that there is no significant divergence of the experimental results obtained in the OLS model, with the fixed effects model and the random effects model, and the expected signals for some independent variables are generally the hypotheses formulated. If we compared both econometric models, it is verified that regardless of the model used, or of the dependent variable analyzed, some of the independent variables are statistically significant in all analyzed models. Furthermore, we also found evidence that the same expected signals are in agreement with the standard financial theory. These empirical findings may suggest good indicators for making more efficient decisions about the determinants of the capital structure. Research limitations/implications: The main contribution of this work is mainly in which econometric models had best results (according to existing theories) to analyse capital structures of companies. We found that the econometric model chosen for the analysis of the variables must be analysed insofar as some of the independent variables are sensitive to the expected signal and statistical significance, depending on the selected model. Practical implications: These findings will be very useful to top managers in the process of deciding the optimal structure of capital without neglecting the long run financial sustainability of the companies. Originality/value: This study is different because go beyond the classical capital structure determinants and also shows a comparison between different econometric models.
- Another look into the relationship between economic growth, carbon emissions, agriculture and urbanization in Thailand: a frequency domain analysisPublication . Mata, Mário Nuno; Oladipupo, Seun Damola; Rjoub, Husam; Ferrão, Joaquim; Altuntaş, Mehmet; Martins, Jessica Nunes; Kirikkaleli, Dervis; Dantas, Rui; Lourenco, AntonioThis empirical study assesses the effect of CO2 emissions, urbanization, energy consumption, and agriculture on Thailand’s economic growth using a dataset between 1970 and 2018. The ARDL and the frequency domain causality (FDC) approaches were applied to assess these interconnections. The outcome of the bounds test suggested a long-term association among the variables of investigation. The ARDL outcomes reveal that urbanization, agriculture, energy consumption, and CO2 emissions positively trigger Thailand’s economic growth. Additionally, the frequency domain causality test was used to detect a causal connection between the series. The main benefit of this technique is that it can detect a causal connection between series at different frequencies. To the understanding of the authors, this is the first study in the case of Thailand that will apply the FDC approach to capture the causal linkage between GDP and the regressors. The outcomes of the causality test suggested that CO2 emissions, urbanization, energy consumption, and agriculture can predict Thailand’s economic growth in the long term. These outcomes have far-reaching implications for economic performance and Thailand’s macroeconomic indicators.
- The effect of inventory leanness on firms’ credit ratings: the case of PakistanPublication . Carvalho, Paulo Viegas; Shah, Syed Hammad Hussain; Zaheer, Abrish; Mata, Mário Nuno; Lourenco, AntonioInventory leanness requires that firms minimize inventory mistreatment and misuse. A firm performance deteriorates because of high inventory misuse, and because of such an issue, the effect on the firm’s credit rating can also be seen. This study examines the effect of inventory leanness on firms’ credit ratings. It aims to create an understanding of the relationship between inventory leanness and the firm’s financial performance and provides insight into the credit rating system of Pakistan. We analyze secondary Pakistan data between 2008 and 2017. Among the sixty firms on Pakistan Stock Exchange that are rated by PACRA, only thirty-eight have complete data available on their respective websites. By using panel data analysis, the results indicate that inventory leanness and credit ratings are positively related. In an added analysis, we evaluate the financial performance in the context of credit rating by using control variables (size, leverage, and capital intensity ratio) and dummy variables (loss and subordinate debt). Our results are consistent with earlier studies.