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Pecking order or just peck order is the colloquial term for a hierarchical system of social organization in chickens. It was first described from the behaviour of poultry by Thorleif Schjelderup-Ebbe in 1921 under the German terms Hackordnung or Hackliste and introduced into English in 1927.
The original usage of "pecking order" referred to the expression of dominance of birds. Dominance in chickens is expressed in various behaviours including pecking which was used by Schjelderup-Ebbe as a measure of dominance and leadership order. In his 1924 German-language article he noted that "defense and aggression in the hen is accomplished with the beak".
This emphasis on pecking led most subsequent studies on fowl behaviour to use it as a primary observation. However, it was also noted that roosters tended to leap and use their feet in conflicts. The term dominance hierarchy is often used for this phenomenon in other animals.
It is a basic concept in social stratification and social hierarchy that has its counterpart in other animal species, including humans. Still, the term "pecking order" is often used synonymously; the "pecking order" was the first studied example of the social hierarchy among animals.
The basic concept behind the establishment of the pecking order among, for example, chickens, is that it is necessary to determine who is the 'top chicken,' the 'bottom chicken' and where all the rest fit in between. The establishment of the dominance hierarchy is believed[according to whom?] to reduce the incidence of intense conflicts that incur a greater expenditure of energy. The dominance level determines which individual gets preferential access to resources such as food and mates.
Pecking order theory in finance 
Donaldson observed that firms prefer first to finance investment with retained earnings, then, when they need outside funding, they prefer to issue severe debt instead of equity. It suggests that capital structures are determined largely by the history of needs for external finance. Pecking-order theory explains negative intra-industry correlation between profitability and debt to equity ratio, and the negative share price reaction on announcement of an equity issue (i.e. information asymmetric).
See also 
- Perrin, P.G., (1955). Pecking order 1927-54. American Speech, 30(4): 265-268
- Schjelderup-Ebbe, 1975 p. 36 cited in Rajecki, D.W. (1988)
- Rajecki, D.W. (1988). Formation of leap orders in pairs of male domestic chickens. Aggressive Behavior, 14(6): 425-436
- "The Chicken Industry". PETA.org. Retrieved 2013-05-11.
Further reading 
- Schjelderup-Ebbe, T. (1975). Contributions to the social psychology of the domestic chicken [Schleidt M., Schleidt, W.M., translators]. In, Schein, M.W. (ed); "Social Hierarchy and Dominance. Benchmark Papers in Animal Behavior, Volume 3." Stroudsburg, PA: Dowden, Hutchinson and Ross, pp. 35–49. (Reprinted from Zeitschrift fuer Psychologie, 1922, 88:225-252.)
- Pinder, S. (Jun, 2007). Financing Decisions. University of Melbourne Financial Management (333-641) lecture notes.
- Peirson, G., Brown, R., Easton, S. & Howard, P. (2003). Business Finance. North Ryde, NSW, Australia: McGraw-Hill Australia. ISBN 0-07-471439-2.