The Impact of Financial Structure on Debt Evidence from Listed Companies in the USA

Abstract

This study explores the factors that influence corporate debt levels by focusing on key firm-specific characteristics such as firm size, profitability, environmental variability, growth, tangible assets, and liquidity. Using statistical techniques including correlation analysis, multicollinearity testing, and multiple regression, the study examines how these variables explain differences in firms’ debt levels. The results show that firm size, tangible assets, and liquidity have a significant and positive impact on debt. This suggests that larger firms, those with more physical assets, and firms with stronger liquidity positions are more likely to rely on higher levels of debt financing. On the other hand, profitability, environmental variability, and firm growth do not show a statistically significant effect, even though their relationships with debt are positive. These findings offer useful insights for managers and policymakers. In particular, improving liquidity management, strengthening asset investment, and developing long-term financial strategies can enhance firm performance. Future research can expand this model by including additional firm-level, market-level, and macroeconomic variables to provide a deeper understanding of debt behavior.