Deterninants of Capital Structure in International Joint Ventures Located in Korea

초록

This study investigates whether capital structure in international joint ventures conforms to the norms of dominant partners,follows the local norms, or has mixtures of local and foreign norms, or varies to exploit economic opportunities and firm specific advantage. The results of this study show that it follow neither local nor foreign norms. Factors such as industry classification, size, tax rate and years of establishment are not significant determinants of capital structure, either. Percentage of foreign owned equity and profitablity are significant factors. Importance of own-ership and profitability seems to suggested that firm specific or environmental variables play an impotant role in deciding capital strcutures in international joint ventures.