Similarity : INVESTMENT OPPORTUNITY SET, OWNERSHIP STRUCTURE AND FUNDING POLICY: AN AGENCY THEORY APPROACH

Khoirul, Hikmah and Tulus, Haryono and Djuminah, Djuminah and Nasrulloh, Rifqi Syarif (2019) Similarity : INVESTMENT OPPORTUNITY SET, OWNERSHIP STRUCTURE AND FUNDING POLICY: AN AGENCY THEORY APPROACH. Lekantara.

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Abstract

The objective of this study is to evaluate and analyze the influence of Invesment Opportunity Set (IOS) towards funding policy of a company as well as the influence of two moderating variables, public and foreign ownership, towards the relationship between IOS and funding policy. The researchers involved control variables in order to describe the influence of IOS and funding policy. The control variables were firm size, business risk and profitability. The population was all companies listed in Indonesian Stock Exchange between 2008 and 2016. The sampling method was purposive sampling. The data analysis methods were regression model for panel data, Eviews and Factor Analysis. Based on the data analysis, IOS has negative influence towards funding policy. As the result, companies with lower debt to equity ratio in their funding structure tend to use their own capital (equity financing) to eliminate agency issues. Government ownership strengthened the influence of IOS towards funding place both before and after the control variables were involved. This showed that government can influence policy-making in the company and government regulation can either improve or become hindrance for performance. Foreign ownership also strengthened the influence of IOS towards funding policy, both before and after the control variables were involved. Therefore, companies can get higher amount of investment through foreign ownership in terms of, for example, management system, technology and innovation, skills and marketing. In addition, companies can hire well-experienced managers who can improve their performance.

Item Type:	Other
Uncontrolled Keywords:	Investment Opportunity Set, Government ownership, Foreign Ownership, Funding Policy, Firm Size, Business Risk, Profitability and Agency Theory
Subjects:	H Social Sciences > HB Economic Theory
Divisions:	Faculty of Law, Arts and Social Sciences > School of Management
Depositing User:	Tri Yuliani
Date Deposited:	25 Apr 2022 06:48
Last Modified:	25 Apr 2022 06:48
URI:	http://repository.unu-jogja.ac.id/id/eprint/194

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