Innovative Journal of Business and Management

This research uses the non-linear model to measure the impact of capital structure on financial performance of Vietnamese state-owned enterprises (SOEs). The study results show that there are different relations between capital structure and financial performance at different thresholds. For example, in the range of (0.040; 0.703), capital structure (measured by the ratio of long-term debt on equity) is positively related to financial performance (measured by the ratio of profitability on equity), outside that range, the relation is negative. In this study, we find out that quadratic and cubic non-linear models have a significant in measuring the relationship between capital structure and financial performance.

It has become the new fact of the twenty-first century that the Western world, we have known is fast trailing its ascendancy to be replaced by a new global system shaped by the so-called BRICS comprising Brazil, Russia, India China and South Africa. This is the way, how many historians, academicians, economists, and students of world politics are now viewing the prospects of the global system. This article does not argument the economic facts, nor does it presume that the world will look the same in 50 years time as it is now. It does, conversely, question the thought that there is an enticing ‘power shift’ from west to East. Purposely, it makes a number of decisive wiles pertaining to the new tale. Firstly, what is obviously changing in the world and what is underestimated. Secondly, it is accurate that many new economies are pretentious in the world economy, but their careful examination is must and when such an examination is undertaken, it becomes increasingly clear that the rise of BRICS is a daunting challenge to western world.