International Journal of Innovation and Applied Studies
ISSN: 2028-9324     CODEN: IJIABO     OCLC Number: 828807274     ZDB-ID: 2703985-7
Friday 05 June 2020






Custom Search


Connect with IJIAS

  Call for Papers - June 2020     |     Now IJIAS is indexed in EBSCO, ResearchGate, ProQuest, Chemical Abstracts Service, Index Copernicus, IET Inspec Direct, Ulrichs Web, Google Scholar, CAS Abstracts, J-Gate, UDL Library, CiteSeerX, WorldCat, Scirus, Research Bible and getCited, etc.  

Determinants of Capital Structure in Nigeria

Volume 3, Issue 4, August 2013, Pages 999–1005

 Determinants of Capital Structure in Nigeria

Oladele John AKINYOMI1 and Adebayo OLAGUNJU2

1 Financial Studies Department, Redeemer University, Mowe, Ogun State, Nigeria
2 Financial Studies Department, Redeemer University, Mowe, Ogun State, Nigeria

Original language: English

Received 29 May 2013

Copyright © 2013 ISSR Journals. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.


Capital structure represents one of the most discussed concepts in financial management. Capital structure refers to how a company finances its operations whether through shareholders equity-fund or debt or a combination of both. Various internal and external factors contribute to the choice of these sources of fund. The external factors include factors such as tax policy, capital market conditions and tax policy, among others. Meanwhile, the internal factors are those that relate to individual firm characteristics. This study examines the determinants of capital structure in Nigeria using the descriptive research design. The population comprised of the eighty-six manufacturing firms that are listed in the Nigerian Stock Exchange. The sample firms were selected using the simple random sampling method. Secondary data obtained from the annual accounts of 24 randomly selected manufacturing firms for 10 years period culminating in 240 firm-year observations. The results of the regression analysis revealed that leverage (a measure of capital structure) has a negative relationship with firm size and tax on one hand and a positive relationship with tangibility of assets, profitability and growth on the other hand. However, only with tangibility of assets and firm size that significant relationship is established. It is recommended for future researchers to carry out similar studies in multiple sectors.

Author Keywords: Capital Structure, Leverage, Tangibility, Firm Growth, Manufacturing.

How to Cite this Article

Oladele John AKINYOMI and Adebayo OLAGUNJU, “Determinants of Capital Structure in Nigeria,” International Journal of Innovation and Applied Studies, vol. 3, no. 4, pp. 999–1005, August 2013.