A study of macroeconomic activities and capital structure decision of technology sector in Bursa Malaysia / Mohd Khairul Amir Zollkefly

This study uses panel data which comprises of both time series and cross-sectional data involving multiple numbers of companies. By using the seemingly related regression approach, it is critical to mitigate the effect of macroeconomic factors on capital structure decisions of firms under technology sectors which are listed in Bursa Malaysia over the period of 2005 until 2009. The study is testing the relationships between the capital structure decisions of the companies and various macroeconomic variables in Malaysia. The study applies the multivariate cointegration methodology to establish the possible causal relations between these variables. Using factor analysis and panel data regression techniques, this study demonstrates the evidence of positive relationships between real capital structure decisions and measures of aggregate economic activity which are including inflation rate, overnight policy rate (OPR), gross domestic product (GDP) and size of firm.