CEU Electronic Theses and Dissertations, 2009
| Author | Malasic, Vanja |
|---|---|
| Title | CAPITAL MARKETS DEVELOPMENT AND THEIR INFLUENCE ON THE CAPITAL STRUCTURE OF TRADED CROATIAN COMPANIES |
| Summary | The paper looks at the results of the 2002 Securities Market Act in Croatia on the capital structure of listed and traded Croatian joint stock companies. The act required that all qualifying joint stock companies list their stocks on the new joint stock companies quotation regardless whether they were or wished to be listed. In addition, the act demanded companies listed on the newly formed joint stock companies quotation to submit their quarterly financial and business results which was not the case before. It would be expected that with the increased transparency of the equity markets and greater market capitalization companies would resort to equity financing following the act. However, the paper finds that companies did not increase their shareholder's equity. Moreover, companies seemed to follow behavior predicted by the pecking order theory using internal financing when available, and debt financing when external financing was needed. Their reluctance to use the equity markets indicates that costs of equity remain high for Croatian companies possibly due to high informational asymmetry. |
| Supervisor | Attila Ratfai |
| Department | Economics MA |
| Full text | https://www.etd.ceu.edu/2009/malasic_vanja.pdf |
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