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Pecking order view of capital structure

• The argument that external financing transaction costs, especially those associated with the problem of adverse selection, create a dynamic environment in which firms have a preference, or pecking-order of preferred sources of financing, when all else is equal. Internally generated funds are the most preferred, new debt is next, debt-equity hybrids are next, and new equity is the least preferred source.

 
 

Follow this link for all the terms related to capitalorder.

 
 Embedded terms in definition
 Adverse selection
Debt
Equity
Transaction costs
 
 Related Terms
 
Agency cost view
At the opening order
Average cost of capital
Bankruptcy cost view
Bankruptcy view
Buy limit order
Buy stop order
Capital
Capital account
Capital adequacy
Capital allocation decision
Capital appreciation
Capital asset
Capital asset pricing model
Capital budget
Capital budgeting
Capital cost allowance
Capital expenditure
Capital flight
Capital gain
Capital gains yield
Capital impairment rule
Capital lease
Capital loss
Capital market
Capital market efficiency
Capital market imperfections view
Capital market line
Capital rationing
Capital stock
Capital structure
Capital surplus
Change in net working capital
Complete capital market
Complex order
Conditional order
Contingent order
Corporate tax view
Cost of capital
Cost of limited partner capital
Day order
Debt capital
Debt to capital ratio
Dedicated capital
Designated order turnaround
Economic order quantity
Efficient capital market
Equity capital
Exchange rate risk capital budgeting
Fill or kill order
Financial or capital lease
Financial structure
Gigo garbage in, garbage out in capital budgeting
Hard capital rationing
Human capital
Invested capital
Issued share capital
Legal capital
Limit order
Limit order book
Liquidity theory of the term structure
Marginal cost of capital
Marginal cost of capital schedule
Market order
Negotiable order of withdrawal
Net working capital
Net working capital recapture
Nondiversifiability of human capital
Open good til cancelled order
Open order
Opportunity cost of capital
Optimal capital structure
Or better order
Order
Order book official
Order costs
Order support system
Other capital
Outstanding share capital
Pecking order
Perfect capital market
Perfect market view of capital structure
Perfect market view of dividend policy
Personal tax view of capital structure
Pie model of capital structure
Planned capital expenditure program
Pre sale order
Pro forma capital structure analysis
Real capital
Real options capital budgeting
Regulatory capital
Resting order
Risk capital budgeting
Sell limit order
Signaling view on dividend policy
Soft capital rationing
Sophisticated approaches to capital budgeting
Static theory of capital structure
Stop limit order
Stop loss order
Stop order
Taking a view
Target capital structure
Tax differential view of dividend policy
Taxable capital gain
Term structure
Term structure of interest rates
Term structure of interest rates and volatility
Total capital
Traditional view of dividend policy
Uniform net capital rule
Unrestricted order
Venture capital
Weighted average cost of capital
Working capital
Working capital management
Working capital ratio

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