Corporate leverage and monetary policy transmission mechanism in India: A dynamic approach.

IF 0.7 Q4 BUSINESS, FINANCE

Asian Academy of Management Journal of Accounting and Finance Pub Date : 2021-12-10 DOI:10.21315/aamjaf2021.17.2.8

Aishwarya Nagpal, Megha Jain

引用次数: 1

Abstract

The macroeconomic policies of a nation have a major bearing on the financial performance of the companies and their potential sustainability and growth. This study investigates the impact of monetary policy on the corporate leverage adjustment through microscopic monetary policy transmission channels, mainly the interest rate and credit channels, using a sample of 422 manufacturing firms in India from 2011 to 2017 by employing partial adjustment model. The findings suggest that contractionary monetary policy cuts down overall corporate debt. The study further asserts that corporate debt in Indian firms demonstrates target behaviour and the speed at which firms adjust their actual debt ratios towards target debt ratios is a function of not only firm-specific characteristics but also macroeconomic conditions prevailing in the country, proxied by monetary policy indicators in our study. The study has critical policy implications as the balance sheet situation of corporates is a crucial factor in the financial stability of the economy.

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印度企业杠杆与货币政策传导机制:动态分析。

一个国家的宏观经济政策对公司的财务业绩及其潜在的可持续性和增长有着重大影响。本文以2011 - 2017年印度422家制造业企业为样本，采用部分调整模型，通过微观货币政策传导渠道，主要是利率和信贷渠道，考察了货币政策对企业杠杆调节的影响。研究结果表明，紧缩的货币政策降低了整体企业债务。该研究进一步断言，印度公司的公司债务表现出目标行为，公司将实际负债率调整到目标负债率的速度不仅是公司特定特征的函数，也是该国普遍存在的宏观经济状况的函数，由我们研究中的货币政策指标所代表。该研究具有重要的政策意义，因为企业的资产负债表状况是经济金融稳定的关键因素。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Asian Academy of Management Journal of Accounting and Finance BUSINESS, FINANCE-

CiteScore

1.50

自引率

0.00%

发文量

审稿时长

20 weeks

期刊介绍： To provide a forum for the exchange of ideas and dissemination of empirical findings and analytical research in the specialized areas of accounting and finance with special emphasis on scholarly works with policy implications for countries in the Asia Pacific. The following are some of the topical subject areas relevant to the journal (but are not limited to): Accounting • Financial reporting and accounting standards • Auditing issues • Value based accounting and its relevance • Theory of accounting firm • Environmental auditing • Corporate governance issues • Public sector accounting Finance • Valuation of financial assets • International capital flows • Ownership and agency theory • Stock market behavior • Investment and portfolio management • Islamic banking and finance • Microstructures of financial markets