Abstract:
This research study is carried out with objective to investigate the significance of macro economic indicators including GDP, inflation rate, rate of interest, and currency exchange rate, and size of company on capital structure with controlling role of leverage, profitability of company, and tangibility of assets of all non-financial sectors of Pakistan Stock Exchange. Data for this research was collected from 2001 to 2019 and panel regression (fixed and random effect) was applied with both data with and without crisis period (2007 to 2009). Also, in this study standard industrial classification of Fama and French (2012) used to check significance of 12 industries’ dummies. Results have shown the significant impact of GDP on capital structure combinedly for non-financial sector. While, significant impact of GDP on capital structure for non-financial sector only. When data was run with crisis period dummy only GDP found significant for capital structure to the non-financial sector and when data was run with SIC codes dummy then also GDP found significant for capital structure to the non-financial sector.
