Abstract
Asymmetric infomation has caused difficulties for investors in the financial market when the enterprises have high competitiveness in the market but there are acts of using unusual capital structure. Investment decisions on the stock market of investors will be negatively affected by asymmetric information. In particular, the manufacturing enterprises have made an important contribution to Vietnam’s economic structure. Therefore, the authors conduct research to assess the impact of product market competition on the capital structure of manufacturing enterprises listed in the Vietnam stock market from 2010 to 2018. By analyzing panel data through the Generalized Method of Moments (GMM), the research results indicate: Competitiveness factors HHI has a negative impact on debt ratio (DR)—the results support the predation theory. When businesses are highly competitive, there will be a tendency to reduce the debt ratio. At the same time, the research results also show the variables ROA and CGIR have negative effects on DR. GRTA and NDTS variables do not affect the DR of manufacturing enterprises. The results of this study will help investors to make their decisions more wisely.
Highlights
1.1 Introduce the ProblemIn the international economical integration period, business entities come under pressure from their domestic rivals and have to directly compete with foreign enterprises
By analyzing panel data through the Generalized Method of Moments (GMM), the research results indicate: Competitiveness factors Hirschman Index (HHI) has a negative impact on debt ratio (DR)—the results support the predation theory
The results show that the reliable GMM model with AR (2) and Hansen test has p-value greater than 0.05
Summary
In the international economical integration period, business entities come under pressure from their domestic rivals and have to directly compete with foreign enterprises. They need to carefully plan and calculate their strategies before making decisions. In the industry and construction sectors, processing and manufacturing industries continue to be a bright spot contributing to economic growth with a high increase of 12.98%. This growth rate was lower than 2017, it was much higher than the average increase in the years 2012–2016. The processing and manufacturing sectors continue to play a key role, boosting the overall growth of the industry with an increase of 12% ( lower than the 14% increase of 2017 but still higher than the increase of the years 2012–2016); electricity production and distribution industry ensures sufficient electricity supply for production and consumption of the population with a 10% increase; water supply and waste and wastewater treatment industry increased by 6.3%; the mining industry decreased by 2% (mainly due to the 11% decrease in crude oil exploitation) (GSO, 2019)
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