Determinants of capital structure: Evidence from Istanbul stock exchange

ABSTRACT: This thesis aims to explain determinants of capital structure evidence from istanbul stock exchange from three companies (Turkcell ,Vodafone and Deutesche Telekom).The two main theories used are for trade-off theory and pecking order theory. The essential of the pecking order is the manager's of capital structure decision are influenced by the market perception of manager's superior information. The trade-off theory provides support for manager's trade-off between benefits and costs of debt .the conventional model is also used in the analysis in the order to increase the robustness of the results . We find that dynamic partial-adjustment model of the trade-off theory seems to explain better the choice of capital structure in the analyzed period than pecking order theory . Keywords: capital structure, pecking order theory, trade-off theory. …………………………………………………………………………………………………………………………