Proceedings of the 2nd International Academic Conference on Blockchain, Information Technology and Smart Finance (ICBIS 2023)

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Study on the Relationship Between Corporate Financial Leverage and Financial Performance Based on Linear Multiple Regression Model via Stata System

Authors
Haomin Wu1, Zezhou Zhao2, Weicheng Zhai3, *
1Faculty of Liberal Arts & Professional Studies, York University, Toronto, ON, M3J 1P3, Canada
2School of Finance, Nanjing University of Finance and Economics, Nanjing, 210046, Jiangsu, China
3Economics, University of California, La Jolla, San Diego, CA, 92023, USA
*Corresponding author. Email: wzhai@ucsd.edu
Corresponding Author
Weicheng Zhai
Available Online 10 August 2023.
DOI
10.2991/978-94-6463-198-2_6How to use a DOI?
Keywords
Financial Leverage; Financial Performance; Listed company
Abstract

The size of corporate financial leverage is one of the important factors affecting corporate financial performance. The proportion of debt capital in corporate assets will bring additional benefits and risks to enterprises through the financial leverage effect, which will affect the value of the company, and then affect the performance of the company. However, scholars have not had a unified understanding of the relationship between financial leverage and enterprise performance for a long time. Based on the research of China’s A-share listed companies from 2015 to 2019 from CSMAR database, this paper empirically tests the relationship between the capital structure of listed companies and their profitability by using a linear multiple regression model. Research shows that financial leverage has a significant negative impact on corporate performance. Based on the empirical results, this paper gives some suggestions on how to control financial leverage.

Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2nd International Academic Conference on Blockchain, Information Technology and Smart Finance (ICBIS 2023)
Series
Atlantis Highlights in Computer Sciences
Publication Date
10 August 2023
ISBN
10.2991/978-94-6463-198-2_6
ISSN
2589-4900
DOI
10.2991/978-94-6463-198-2_6How to use a DOI?
Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Haomin Wu
AU  - Zezhou Zhao
AU  - Weicheng Zhai
PY  - 2023
DA  - 2023/08/10
TI  - Study on the Relationship Between Corporate Financial Leverage and Financial Performance Based on Linear Multiple Regression Model via Stata System
BT  - Proceedings of the 2nd International Academic Conference on Blockchain, Information Technology and Smart Finance (ICBIS 2023)
PB  - Atlantis Press
SP  - 49
EP  - 58
SN  - 2589-4900
UR  - https://doi.org/10.2991/978-94-6463-198-2_6
DO  - 10.2991/978-94-6463-198-2_6
ID  - Wu2023
ER  -