In examining the adjustment-speed in dynamic capital structure choice of the firms, the present study utilizes a Dynamic Partial Adjustment Model, and extends the work of Drobetz and Wanzenried (2006). The study explores that firms’ recapitalization policy allows dynamic adjustments in leverage revision through two decision variables-the target leverage, and the adjustment-speed. We evidence that firms’ dynamic recapitalization is subject to changes in the firm-specific as well as the macroeconomic variables, where both the target leverage and the adjustment-speed are determined by firms’ reactive and/or pro-active adjustment behaviors.