Financial crisis and determinants of the capital structure of Spanish maritime transport firms

Abstract

The purpose of this article is to analyze how the financial crisis affects the determinants of the capital structure of Spanish maritime transport firms according to both the trade-off and pecking order theories. Additionally, we test whether these effects differ between short and long-term debts. Using a sample of 225 firms (1,805 observations) between 2001 and 2015, we find that firms’ liquidity and profitability are the main drivers of leverage before the crisis, whereas, during the crisis, leverage is also explained by non-debt tax shields and the level of tangible assets. Besides, our results show that the capital structure decisions of Spanish maritime transport firms are mainly determined by the pecking order theory, especially during the crisis. In this way, the pecking order theory plays an important role on total and short-term debts both before and during the crisis. However, the pecking order theory is only relevant in explaining long-term debt during the crisis. Before the crisis, there are no conclusive results about whether long-term debt is determined by the trade-off or the pecking order theory.