This paper examines the dynamics of financial in presence of ownership concentration of newly created firms. Our objective is to test the empirical role of the trade-off theory to explain the financial behaviour of business start-up. We use a sample of 114 business start-ups and we use the panel data estimation over the period 2006-2010. Our results show that start-up firms adjust slowly to target ratio for first years of operation. Ownership dispersion accelerates adjustment to debt funding. Asset tangibility remains the main determinants of debts funding for business start-up.
Capital Structure, Trade-off Theory, start-up, Dynamic Structure, Costs of Adjusting, Corporate Finance, ownership concentration.
"Ownership concentration Dynamic trade off theory And debt funding of business start-up,"
The Journal of Entrepreneurial Finance:
Available at: https://digitalcommons.pepperdine.edu/jef/vol23/iss1/3
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