The Impact of Managerial Discretion and Control Challenges on Dynamic Capital Structure

2003 ◽  
Author(s):  
Sergei Polevikov
Keyword(s):  
Capital Structure ◽  
Managerial Discretion ◽  
And Control ◽  
The Impact ◽  
Dynamic Capital Structure

scholarly journals The influence of firm, industry and concentrated ownership on dynamic capital structure decision in emerging market

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Razali Haron ◽  
Naji Mansour Nomran ◽  
Anwar Hasan Abdullah Othman ◽  
Maizaitulaidawati Md Husin ◽  
Ashurov Sharofiddin
Keyword(s):  
Capital Structure ◽  
Emerging Market ◽  
Generalized Method Of Moments ◽  
Dynamic Environment ◽  
Order Theory ◽  
Ownership Concentration ◽  
Content Type ◽  
Dynamic Panel Model ◽  
The Impact ◽  
Dynamic Capital Structure

Purpose This study aims to evaluate the impact of firm, industry level determinants and ownership concentration on the dynamic capital structure decision in Indonesia and analyses the governing theories. Design/methodology/approach This study uses the dynamic panel model of generalized method of moments-System (one-step and two-step) by using a panel data from 2000 to 2014 to examine the relationship between the determinants and leverage. The results are robust to the various definitions of leverage, heterogeneity, autocorrelation, multicollinearity and endogeneity concern. Findings Growing firms and firms operating in a highly concentrated industry use high level of debt, taking advantage of the tax shield (trade-off theory). However, if the firms are operating in a highly dynamic environment, they take on less debt as to avoid bankruptcy risk. Firms in Indonesia opt for debt financing perhaps to act as a controlling mechanism to mitigate agency conflicts that may exist between the large controlling shareholders and the minority. Aged and highly profitable firms with high tangible and intangible assets and liquidity level operating in a high dynamic environment follow the pecking order theory. Research limitations/implications This study does not perform each industry regression individually. All the industries are pooled together, as the main focus of this study is to examine the factors affecting leverage of firms in general without giving particular attention to individual industry. Originality/value The insights on the impact of ownership concentration and industry characteristics are novel especially on Indonesia, thus fill the gap in the literature.

scholarly journals A comparative study of the impact of sanctions on the oil and cement companies listed in Tehran Stock Exchange: Forecasting and Future Trends

2021 ◽  
Vol 3 (2) ◽  
Author(s):  
Alireza Orangian ◽  
Vida Varahrami ◽  
Elaheh Orangian
Keyword(s):  
Capital Structure ◽  
Stock Exchange ◽  
Future Trend ◽  
Cement Industry ◽  
Leverage Ratio ◽  
Corporate Managers ◽  
Oil Companies ◽  
Petroleum Companies ◽  
And Control ◽  
The Impact

Imposing sanctions can have several malicious effects on a developed or developing economy and Iran is not an exception to this matter. The main purpose of this paper is to determine whether imposing oil sanctions have a significant impact on oil, gas and petroleum companies’ capital structure or not. Furthermore, a comparison between oil industry and cement industry and a prediction of oil companies’ capital structure trend are conducted. The most innovative aspect of our study is to evaluate the influence of sanctions on a firm-specific variable rather than macroeconomic level. To address this problem, we investigate oil and cement companies listed in Tehran Stock Exchange from 2006 to 2018. The leverage ratio indicating capital structure, sanction dummy variable and ROA, tangibility of assets, capital market return, economic growth and inflation rate are dependent variable, independent variable and control variables, respectively. The data are obtained from companies’ financial statements and we use OLS regression to estimate our equations. The results indicate that the 2012 oil sanctions against Iran affect the oil companies’ leverage ratio negatively and the future trend reveals that the share of equity in capital structure will increase. Moreover, we inspect no significant relationship between oil sanctions and cement companies’ capital structure. Therefore, government policymakers should plan strategies to lift or limit the oil sanctions and oil corporate managers should find some reasonable routes for balancing their companies’ capital structure to exploit debt financing benefits.

scholarly journals The impact of family involvement in business on capital structure decisions: a literature review

2019 ◽  
Vol 16 (1) ◽  
pp. 258-266 ◽  
Author(s):  
Amr Ahmed Moussa ◽  
Khairy Elgiziry
Keyword(s):  
Capital Structure ◽  
Family Involvement ◽  
Ownership Structure ◽  
Management Style ◽  
Debt Financing ◽  
Direct Impact ◽  
Unique Form ◽  
Financial Policies ◽  
And Control ◽  
The Impact

Family-controlled firms are a unique form of business because of the special nature of its ownership structure, management style, and financing needs. Moreover, these firms face difficulty in achieving a balanced mix of available financing alternatives (i.e., debt and equity), and this mix has a direct impact on the firms’ profitability, risk, and value. Therefore, the purpose of this study is to review the literature on how family involvement in business via ownership, management, and control affects capital structure decisions. The review showed that in a comparison with nonfamily businesses, family-controlled firms on average have higher debt levels. Additionally, family ownership is positively associated with debt financing, and the participation of family members in a firm’s top management leads to an increase in the firm’s overall debt level. Insights generated from the current study highlight the critical influence of family involvement in business on key financial policies such as capital structure decisions.

scholarly journals Does pyramiding have an impact on firm’s capital structure decision among Malaysian distress companies?

2005 ◽  
Vol 2 (4) ◽  
pp. 93-106 ◽  
Author(s):  
Fauzias Mat Nor ◽  
Amin Noordin Bany-Ariffin
Keyword(s):  
Capital Structure ◽  
Cash Flow ◽  
Ownership Structure ◽  
Direct Result ◽  
Control Rights ◽  
Financing Decisions ◽  
Pyramidal Ownership ◽  
Cash Flow Rights ◽  
And Control ◽  
The Impact

It is documented by La Porta, Lopez and Shleifer (1999) that ultimate owners around the world usually control an array of affiliated companies through hierarchical intermediary corporations forming pyramidal holdings. A direct result of this pyramidal ownership structure is divergence of cash flow rights from control rights in the hand of the largest shareholders (Claessens, Djankov and Lang 2000). This paper investigates the impact of this separation of cash flow rights from control rights resulting from these pyramidal forms of ownership structure on firm’s capital structure. In particular, our objective is to examine whether such separation affects the financing decisions among Malaysian listed distressed companies. Even though it is not conclusive our findings somewhat lend support to the leverage-increasing non-dilution entrenchment effect on corporate leverage, whereby the separation of cash flow rights and control rights leads to the increase of leverage among the distressed companies. Consequently, excessive use of leverage in order to protect ultimate owner’s dominance in these companies then leads to disastrous financial valuation.

Suppressed, but Not Forgotten

2011 ◽  
Vol 70 (1) ◽  
pp. 5-11 ◽  
Author(s):  
Beat Meier ◽  
Anja König ◽  
Samuel Parak ◽  
Katharina Henke
Keyword(s):  
Memory Trace ◽  
Thought Suppression ◽  
Test Phase ◽  
Indirect Test ◽  
Final Test ◽  
Test Experiment ◽  
And Control ◽  
Cue Words ◽  
The Impact

This study investigates the impact of thought suppression over a 1-week interval. In two experiments with 80 university students each, we used the think/no-think paradigm in which participants initially learn a list of word pairs (cue-target associations). Then they were presented with some of the cue words again and should either respond with the target word or avoid thinking about it. In the final test phase, their memory for the initially learned cue-target pairs was tested. In Experiment 1, type of memory test was manipulated (i.e., direct vs. indirect). In Experiment 2, type of no-think instructions was manipulated (i.e., suppress vs. substitute). Overall, our results showed poorer memory for no-think and control items compared to think items across all experiments and conditions. Critically, however, more no-think than control items were remembered after the 1-week interval in the direct, but not in the indirect test (Experiment 1) and with thought suppression, but not thought substitution instructions (Experiment 2). We suggest that during thought suppression a brief reactivation of the learned association may lead to reconsolidation of the memory trace and hence to better retrieval of suppressed than control items in the long term.

Research Participation Experiences of Informants of Suicide and Control Cases

Crisis ◽  
2010 ◽  
Vol 31 (5) ◽  
pp. 238-246 ◽  
Author(s):  
Paul W. C. Wong ◽  
Wincy S. C. Chan ◽  
Philip S. L. Beh ◽  
Fiona W. S. Yau ◽  
Paul S. F. Yip ◽  
...  
Keyword(s):  
Ethical Issues ◽  
Research Participation ◽  
Self Report ◽  
Initial Contact ◽  
Psychological Autopsy ◽  
Autopsy Study ◽  
The People ◽  
And Control ◽  
The Impact

Background: Ethical issues have been raised about using the psychological autopsy approach in the study of suicide. The impact on informants of control cases who participated in case-control psychological autopsy studies has not been investigated. Aims: (1) To investigate whether informants of suicide cases recruited by two approaches (coroners’ court and public mortuaries) respond differently to the initial contact by the research team. (2) To explore the reactions, reasons for participation, and comments of both the informants of suicide and control cases to psychological autopsy interviews. (3) To investigate the impact of the interviews on informants of suicide cases about a month after the interviews. Methods: A self-report questionnaire was used for the informants of both suicide and control cases. Telephone follow-up interviews were conducted with the informants of suicide cases. Results: The majority of the informants of suicide cases, regardless of the initial route of contact, as well as the control cases were positive about being approached to take part in the study. A minority of informants of suicide and control cases found the experience of talking about their family member to be more upsetting than expected. The telephone follow-up interviews showed that none of the informants of suicide cases reported being distressed by the psychological autopsy interviews. Limitations: The acceptance rate for our original psychological autopsy study was modest. Conclusions: The findings of this study are useful for future participants and researchers in measuring the potential benefits and risks of participating in similar sensitive research. Psychological autopsy interviews may be utilized as an active engagement approach to reach out to the people bereaved by suicide, especially in places where the postvention work is underdeveloped.

Using Work Domain Analysis to Evaluate the Impact of Digitization on Command and Control

2008 ◽  
Author(s):  
Daniel P. Jenkins ◽  
Neville A. Stanton ◽  
Paul M. Salmon ◽  
Guy H. Walker
Keyword(s):  
Command And Control ◽  
Domain Analysis ◽  
Work Domain Analysis ◽  
And Control ◽  
The Impact ◽  
Work Domain
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