La structure du capital et la profitabilit\'e: Le cas des entreprises industrielles fran\c{c}aises

TL;DR

This study investigates how capital structure affects the profitability of French industrial firms from 1999 to 2006, finding no significant influence regardless of company size, using a dynamic panel analysis with GMM.

Contribution

It provides empirical evidence on the non-effect of capital structure on profitability in French industrial firms, applying GMM to a large sample over multiple years.

Findings

Capital structure does not influence profitability.

Results are consistent across firm sizes.

Uses dynamic panel GMM methodology.

Abstract

The objective of this article is to analyze the impact of capital structure on profitability. This impact can be explained by three essential theories: signaling theory, tax theory and the agency costs theory. A sample of 1846 French industrial firms are taken over the period 1999-2006, as a dynamic panel study by using the generalized method of moments (GMM). We show that capital structure has no influence on the profitability of French firms, regardless the size of the company.