The Influence of Macroeconomic Conditions on the Speed of Recovery of the Capital Structure of Companies: An Empirical Study on Manufacturing Companies in Indonesia

DOI

10.2991/978-94-6463-443-3_16How to use a DOI?

Keywords

Capital Structure; Macroeconomic; Speed of Recovery

Abstract

In the wake of the COVID-19 pandemic, which began in 2020-2021, the capital structures of companies underwent significant changes due to the decline in the macroeconomic environment, the restriction of company operational activities, and, in some cases, the cessation of operations altogether. As a result, the company’s capital was utilized to finance daily operational costs. To survive this challenging period, companies sought to reestablish their optimal capital structure. The speed at which a company recovers its capital structure (recovery speed) is of critical importance, as it plays a key role in determining whether the company can return to its pre-crisis performance level or even achieve a new, improved level of performance. This study examines the relationship between GDP, inflation, exchange rate, and interest rate and the recovery speed of the capital structure of manufacturing companies listed on the Indonesia Stock Exchange. Using a purposive sampling method, a sample of 167 manufacturing companies was selected for the period 2019-2021. The research method employed was a causal or explanatory approach with multiple regression analysis processed via the SPSS 27 application. The study’s findings indicate that GDP and interest rate have a partial influence on the recovery speed of the capital structure, but do not exert a significant influence when considered together.

Copyright

© 2024 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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TY  - CONF
AU  - Pierdijono Hartono
AU  - Nugraha Nugraha
AU  - Toni Heryana
PY  - 2024
DA  - 2024/06/26
TI  - The Influence of Macroeconomic Conditions on the Speed of Recovery of the Capital Structure of Companies: An Empirical Study on Manufacturing Companies in Indonesia
BT  - Proceedings of the 8th Global Conference on Business, Management, and Entrepreneurship (GCBME 2023)
PB  - Atlantis Press
SP  - 102
EP  - 108
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-443-3_16
DO  - 10.2991/978-94-6463-443-3_16
ID  - Hartono2024
ER  -