THE INFLUENCE OF EQUITY OWNERSHIP TOWARDS LEVERAGEIN MANUFACTURING COMPANY LISTED AT THE INDONESIAN STOCK EXCHANGE FOR 2005-2008

Nurazi, Ridwan and Paulus, Suluk Kananlua and Intan, Zoraya (2017) THE INFLUENCE OF EQUITY OWNERSHIP TOWARDS LEVERAGEIN MANUFACTURING COMPANY LISTED AT THE INDONESIAN STOCK EXCHANGE FOR 2005-2008. In: Malaysia Indonesia International Conference on Economic Management and Accounting (MIICEMA), 25 - 26 November 2010, Universiti Kebangsaan Malaysia.

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Abstract

This research investigates the influence of ownership structure tow ards fir ms’ levera ge in the magnit ude of firms’ growth o pportunit ies ( high growth and low growth opportunities). According to free cash flow hypothesis, leverage is used by manager as an instrument to reduce the overinvestment. The leverage and the ownership structure can also be used as a control mechanism in affecting the financing decision. There are 24 manufacturing companies used as sample in this research. Those companies should have managerial ownership or institutional ownership during 2005-2008 and should be listed in the Indonesian Stock Exchange during that time. In the methodology, hypothesis testing is used in this research. The data are analyzed through multiple regression analysis using SPSS (statistical package for social science) for Windows Version 15. The variables analyzed are managerial ownership, institutional ownership, size, fixed asset, R&D expenses, growth, interest tax credit and net operating loss towards debt or leverage. Simultaneously, using FTest, there is a significant influence between independent variables with dependent variable (leverage) in high growth firms and low growth firms. Partially, the result shows that there is no causal or influence relationship between ownership structure that consists of managerial ownership and institutional ownership towards leverage at the companies with high growth opportunities and the companies with low growth opportunities. In high growth firms, only variables fixed asset and size have significant influence towards leverage. In low growth firms, variables growth, fixed assets, and size have significant influence towards leverage.

Item Type: Conference or Workshop Item (Paper)
Subjects: H Social Sciences > H Social Sciences (General)
Divisions: Faculty of Economy > Department of Management
Depositing User: 161 Septi Septi
Date Deposited: 19 Jan 2017 07:40
Last Modified: 19 Jan 2017 07:40
URI: http://repository.unib.ac.id/id/eprint/11618

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