An International Survey of the Evidence of the Pecking Order Theory of Corporate Financing

Abstract

Despite theoretical continuing developments in many past years, our understanding of the relationship between theories and practical corporate financing decisions remains incomplete. Therefore, this paper aims to supply the comprehensive material for better understanding of the capital structure, in particular, of the pecking order theory of corporate financing. With this aim, more specifically, we first survey literature related to the pecking order theory in order to widely introduce the empirical evidence including not only for the US but also for other international countries. Furthermore, introducing literature that conducted survey research as well, we also survey the international practical situations of corporate financing decisions related to the pecking order theory.