The effect of capital structure on firm efficiency and product competitive market of Listed Companies in Tehran Stock Exchange

Subject Areas : Journal of Investment Knowledge

Bahram Korzbor ¹ , Shadi Shahverdiani ²

1 - Master of accounting, Department of accounting, Shahr-e-Qods Branch, Islamic Azad University, Tehran, Iran
2 - Assistant Professor, Department of business administration, Shahr-e-Qods Branch, Islamic Azad University, Tehran, Iran (corresponding author)

Received: 2017-03-12 Accepted : 2017-09-06 Published : 2017-10-23

Keywords: Capital Structure, Efficiency, Product Competitive Market,

Abstract :

Many theorists of financial markets believe that capital structure has a significant impact on corporate efficiency and product competitive market. In this regard, the impact of capital structure on firm efficiency and product competitive market has been studied at Tehran Stock Exchange in the following research. Therefore, in order to examine the variables of capital structure, efficiency, and product competitive market, the ratio of financial leverage, method of data envelopment analysis, and herfindahl-hirschman index and Tobin’s Q index to be used respectively. On this basis, data of 92 listed companies in Tehran Stock Exchange over the period of 2005 to 2012 was gathered and were studied by econometric models and regression method. The results show that capital structure has significant effect on efficiency and product market competition (According to the Tobin’s Q index) and The results show that capital structure has no significant  effect on product market competition (According to the herfindahl-hirschman index).

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