Study On Economic Growth And Capital Structure Dynamics Of Real Estate Enterprises

When the internal and external environment changes, the dynamic capitalstructure theory believes that companies will adjust its capital structure according tothe circumstances, so enterprise target capital structure choice is a dynamic process.Companies will change its capital structure to the target one according to the changingenvironment. Then, how does China’s real estate companies’ capital structure adjust?What is the adjustment speed in the different stages of economic growth? Whatfactors affect the adjustment speed? Under the condition of the related national realestate regulation policy, what the different of real estate enterprise’s capital structurespeed will be? The real estate enterprise’s capital structure dynamic adjustment theorywill be analyzed and tested with the above problems in this paper. Specifically, thispaper tries to answer the questions as follow:1. How does economic growth affect thespeed of real estate listed company capital structure adjustment, what are thesimilarities and differences under different growth stages for the capital structureadjust speed of real estate companies?2. What factors affect the capital structureadjustment speed, and what the relationships between those factors and the targetcapital structure?This paper reviewed and summarized the dynamic adjustment of capital structurerelated theories and literatures, and analyzed the characteristics of China’s real estatecompanies.On the basis of using empirical research method and using dynamicadjustment model of capital structure, and through the study data of2000-2012realestate listed companies, the author tested the real estate enterprise’s capital structureadjustment speed, and draw the main conclusions:1.The speed of the capital structureof listed companies of real estate and gross domestic product (GDP) growth rate wassignificantly positive correlation, and short-term interest rates significantly negativecorrelation;2. When in a stage of rapid economic growth,the real estate listedcompanies’ capital structure adjustment speed faster than economic growth in a slowerphases.Real estate listed companies have faster speed to adjust its capital structure tothe target one in the economic rapid growth.3.The real estate listed companies havefaster capital structure adjustment speed when the country did not publish relevantregulation policy than released period.