Kapitalstruktur och tillväxt : Svenska SMF:s kapitalstruktur och dess samband med tillväxt.

Sammanfattning

Abstract Title: Capital structure and growth: The relationship between capital structure and growth in Swedish SMEs. Authors: Benjamin Eriksson and Carl Jacobsson Background: The role of capital structure in firm growth has long been a central topic in corporate finance research. However, previous studies present mixed finding, particularly in the context of small and medium-sized enterprises (SMEs), where financing conditions differ from those of larger firms. In addition, growth is operationalized in various ways, contributing to a fragmented understanding of the relationship. The creates uncertainty regarding how capital structure relates to different dimensions of growth, especially in a Swedish context characterized by a predominantly bank-based financing system. Purpose: The purpose of this study is to examine and analyze the relationship between capital structure and growth in Swedish SMEs, with a focus on how this relationship varies depending on the measure of growth applied. Theory: The study is based on the pecking order theory and the trade-off theory, which provide complementary perspectives on firms financing decisions. While pecking order-theory emphasized internal financing, trade-off-theory highlights the balance between the benefits and costs of debt. Method: A quantitative approach is applied using panel data from Swedish manufacturing firms over the period 2015-2025. The dataset consists of 2830 observations. Three separate regression models are estimated, where growth is measured by changes in the number of employees, net sales and total assets. Results and conclusion: The results show that capital structure has a positive and statistically significant relationship with all growth measures, although the strength of the relationship varies. The effect is strongest for total assets and weakest for employment, indicating that capital structure is more closely related to financial expansion than to operational growth. For net sales, a non-linear relationship is identified, where the effect diminishes at higher levels of leverage. Overall, the findings indicate that the relationship between capital structure and growth is not uniform but varies across different dimensions of firm growth. Keywords: SME, Capital structure, growth, Pecking order theory, Trade-off theory and OLS estimation.