You have no items in your shopping cart.
ABSTRACT
The study investigates the relationship between firm age, firm growth and capital structure of 12 manufacturing firms in Nigeria and Ghana for a period of 7 years (2011 to 2017). Three methods were used in the empirical analysis of the study. These are the descriptive statistics, correlation coefficient, and the panel data analysis. The statistical tools employed are the descriptive statistics and correlation analysis which were used to provide the initial background characterization of the data set. The panel data econometric analysis was used for the main analysis of the study.
The findings from the empirical analysis revealed that, firm age has significant negative relationship with capital structure of manufacturing firms in Nigeria and Ghana; firm growth does not have any significant relationship with capital structure of manufacturing firms; while risk has significant negative impact on capital structure, firm size is positive and significantly related with capital structure of manufacturing firms in Nigeria and Ghana.
The study recommends among others that, management should ensure that the age of the firm in its life cycle is consistently matched with debt financing decision in order to determine the best mix of debt and equity that will eventually maximize returns and the wealth of the shareholders. Also, corporate managers must make sure that they subject the growth rate of their firms to critical analysis before making any financing decision in relation to determining the best mix of debt and equity in their capital structure.
