ABSTRACT
This chapter seeks to extend previous research by ascertaining if the capital structure and profitability effects noted above extend to firms listed on the AMEX as well. It also seeks to determine what factors are causing these profitability and capital structure effects. Firms in the utilities and financial services industries were eliminated from the base sample because of the potential biases associated with the heavy regulation of those industries. The coefficients of PPE are all positive and two are significant at the 10 percent level or better. Four of the coefficients of Tobin's q are negative and three of these are significant at the 10 percent level or better. The debt ratios of the sample firms listed on the New York Stock Exchange declined somewhat during 1985–2003 while firms traded on the AMEX market had relatively stable debt ratios.
