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

Kiracı Kasım () and Aydin Nurhan ()
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Kiracı Kasım: Department of Aviation Management, Iskenderun Technical University, Turkey
Aydin Nurhan: Faculty of Economics and Administrative Sciences, Anadolu University, Turkey

Scientific Annals of Economics and Business, 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.

Keywords: low-cost airlines; Pecking order theory; trade-off theory; panel data analysis (search for similar items in EconPapers)
JEL-codes: C23 G32 L93 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:aicuec:v:65:y:2018:i:3:p:227-246:n:3

DOI: 10.2478/saeb-2018-0018

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