Research On The Determinants Of Capital Structure Of China's Military Industry Listed Company Based On Panel Data

The research on capital structure in the west has become one of the most critical issues of corporate finance since the MM theorem had been known. Capital structure and its influencing factors have contact with corporate governance, corporate growth, corporate strategy and corporate values. How to choose the companys'capital structure has become"The Mystery of Capital Structure"of modern economists. The puzzle of determinants of capital structures for Chinese listed companies is much tougher.With the comprehensively promoting of military industry listed enterprises, people pay more attention to the military industry listed company. As representatives of the military defense industry, the military listed company is an important window demonstrating China's military and economic strength and military-technical level. Meanwhile, it is the needs for the country's strategic security .Its good or bad performance will be an important impact on China's national defense. Therefore, this article draws on research related to domestic and foreign scholars'findings. With the analytical tools named stata10.0, the financial datas of 42 mlilitary industry listed company from 2004 to 2008 have been used to do model estimation and empirical analysis on the determinants of capital structure. Thus, doing those to test various factors on capital structure of the military industry listed company. Then, with the lagged dependent variable, this paper uses dynamic adjustment panel data model to estimate the capital structure adjustment model with GMM and further analyze the adjustment of the capital structure and its affecting factors. According to the conclusion of empirical study, suggestions on how to optimize the capital structure of military industry listed companies are presented.