Firm Size and Capital Structure Decisions: Evidence From Turkish Lodging Companies

Year 2011, Volume: 1 Issue: 1, 1 - 11, 01.03.2011

Erdinc Karadeniz , Serkan Yılmaz Kandır , Omer Iskenderoglu Yıldırım Beyazit Onal

https://izlik.org/JA23UR86ZF

Abstract

Aim of this study is to investigate the role of firm size on capital structure decisions of
Turkish lodging companies. In this context, a survey questionnaire is developed and sent to unquoted
Turkish lodging companies. 163 lodging companies answered the survey and they are classified
according to their sizes. Empirical findings reveal that firm size is a significant factor for capital
structure decisions of Turkish lodging companies. Firm size seems to affect lodging companies in
using incentives, issuing common stock, using personal debt and determining target debt ratio. Most of
the empirical findings seem to support pecking order theory.

Keywords

Firm Size , Capital Structure , Pecking Order Theory , Trade-off Theory , Lodging Companies

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