Factors that Determine the Capital Structure: An Empirical Study on Low-cost Airlines

Kasım Kiracı and Nurhan Aydin

Scientific Annals of Economics and Business (continues Analele Stiintifice), 2018, vol. 65, issue 3, 227 - 246

Abstract: The purpose of this study is to identify the factors that determine the capital structure of low-cost airlines. Accordingly, it is aimed to test the factors that determine the capital structure in low-cost airlines in the context of capital structure theories. In the study, 15 airline companies, which had continuous financial data during the 2004-2015 period, were examined empirically. Panel data analysis was used as a method in the study. Findings of the study show that low-cost airlines generally operate based on the trade-off theory while borrowing in the short-term and based on the pecking order theory while borrowing in the long-term. JEL Codes - G32; L93; C23

Keywords: low-cost airlines; Pecking order theory; trade-off theory; panel data analysis (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (1)

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