THE EXISTENCE OF THE PECKING ORDER THEORY OF CAPITAL STRUCTURE ON CROATIAN CAPITAL MARKET

The purpose of this paper is empirical testing of the pecking order theory of the capital structure on Croatian capital market. The survey included 17 non-financial corporations listed on the Zagreb Stock Exchange for the period 2008 – 2016, i.e. all the listed companies for which all the required data were available. Companies from financial sector were excluded from the sample. The existence of the pecking order theory was carried out according to the regression model of Shyam- Sunders and Myers (1999). The results indicate the rejection of the hypothesis of the existence of a strong form of pecking order theory and suggest acceptance of the weak form of pecking order theory. The result is in accordance with other certain studies for the other markets.