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

Kasım Kiracı, Nurhan Aydin


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.


low-cost airlines; Pecking order theory; trade-off theory; panel data analysis.

JEL Codes

G32; L93; C23.

Full Text:



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DOI: http://dx.doi.org/10.2478/saeb-2018-0018


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