Business, Management and Accounting
8 years ago

Dutch SMEs Unlock Funding Secrets: Profitability and Liquidity Key to Capital Structure

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Determinants of the capital structure of Dutch SMEs
E.F. van 't Hul

Paper Summary

The study looked at what factors affect how Dutch small and medium-sized businesses (SMEs) choose their financial structure. They used data from 2010 to 2012 and analyzed over 5000 observations. The results showed that factors like non-debt tax shields, profitability, and liquidity play a big role in how Dutch SMEs decide on their capital structure. The pecking order theory was found to be the most important in explaining these decisions.

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