Staff Publications

Staff Publications

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    'Staff publications' is the digital repository of Wageningen University & Research

    'Staff publications' contains references to publications authored by Wageningen University staff from 1976 onward.

    Publications authored by the staff of the Research Institutes are available from 1995 onwards.

    Full text documents are added when available. The database is updated daily and currently holds about 240,000 items, of which 72,000 in open access.

    We have a manual that explains all the features 

Record number 560802
Title Dynamic target capital structure and speed of adjustment in farm business
Author(s) Aderajew, Tamirat S.; Trujillo-barrera, Andres; Pennings, Joost M.E.
Source European Review of Agricultural Economics 46 (2019)4. - ISSN 0165-1587 - p. 637 - 661.
Department(s) WASS
Marketing and Consumer Behaviour
Publication type Refereed Article in a scientific journal
Publication year 2019
Abstract This paper quantifies the determinants and speed of adjustment to the target capital structure for a panel of 1,500 Dutch farms over the years 2001–2015. Using the System General Method of Moments (System-GMM) estimator, the results show that farm profitability, earnings volatility, asset tangibility and growth opportunity are important determinants of leverage. Leverage is highly persistent, i.e. the average adjustment speed is relatively low, with variations among farm types. This variation is mainly attributed to the difference in adjustment costs. Further, we show that the pecking order and signalling theories explain these leverage dynamics.
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