THE DTERMINANTS OF FINANCIAL STRUCTURE IN THE ALGERIAN ENTERPRISES: A COMPARATIVE STUDY BETWEEN THE SMEs AND LARGE COMPANIES

Abstract

The aim of this work is to identify the determinants of the financing structure of the Algerian companies, using the financial statements of 83 large companies and 165 SMEs over the period 2008-2010. This is done through a comparative study between SMEs and large companies in order to verify the existence of a size effect and, subsequently, test the homogeneity of Algerian SMEs in terms of mode of financing. The results of our research indicate that the Algerian SMEs and large companies have almost the same determinants of financial structure, i.e. the debt rate, the rate of sustainable growth and profitability. The undercapitalization of SMEs has negative repercussions on their financial structure and, consequently, on their growth.