Simultaneous analysis of insider ownership, debt and dividend policies as mechanism to control agency problems
PRAMONO, Agus, Prof.Dr. Mas'ud Machfoedz, MBA
2002 | Tesis | Magister Manajemen-
The ownership separation and control in the modern corporation creates two parties that have different interest, the managers (agent) and the owner (principals). Sometime the agent does not work at the principals interest, so the equity agency problems arise. Agency theory suggest several ways to reduce this conflict by using increase insider ownership, debt policy, and dividend policy. Several researchers found the interdependency among them. The objective of this study is to test whether there is substitutability from financial policies : debt and dividend, with non financial policy, insider ownership. Based on cross section data, using simultaneous analysis, the results of this study indicate that there is substitutabjlity between dividend and insider ownership. The used of dividend policy to control agency problems will create solution in the existence of free cash flow in the firm.
Kata Kunci : Keagenan,Struktur Modal dan Dividen, Simultaneous Analysis, Agency Problems, Insider Ownership, Debt Policy, Dividend Polic
