Gadjah Mada International Journal of Business
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INTERDEPENDENT ANALYSIS OF LEVERAGE, DIVIDEND, AND MANAGERIAL OWNERSHIP POLICIES: Agencies Perspectives
Get PDFThis paper attempts to investigate interdependent mechanism among leverage, dividend, and managerial ownership policies. This paper considers firm size and economic conditions to control their effect on the relationship among the three policies. The interrelationship between leverage, dividend, and managerial ownership policies will be tested using two-stage least squares. Five exogenous variables are employed in simultaneous equation: current assets and structure of assets as leverage determinants, book to market and return on investment as dividend determinants, and relative return to risk as managerial ownership determinant. The research employs year 1994-2004 data, with 1717 firm years. The research findings can be summarised as follows. First, there is a negative relationship between managerial ownership and leverage policies as suggested by agency theory. Second, there is a relationship between managerial ownership and dividend policies, but the relationship between leverage and dividend is insignificant. Third, the relationship between leverage and dividend is insensitive to economic condition and firm size. Fourth, all exogenous variables have significant effect on endogenous variables, except relative return. Fifth, the effects of exogenous variables are not sensitive to control variables. Sixth, we find that managers show self-interest behaviours by reducing managerial ownership when the economic condition worsens
Competitive Intensity as a Quasi-moderator of the Relationship between Innovative Efforts and Performance
Get PDFThis study empirically investigates the moderating effect of competitive intensity on the relationship between innovative efforts and performance. The study proposes that a firm’s competitive intensity acts as a quasi-moderator of the relationship between innovative efforts and performance.The results support the predictions of the study. The results indicate that competitive intensity moderates the relationship between innovative efforts and performance such that when competitive intensity is high, the relationship between innovative efforts and performance is positive, and vice versa, when the competitive intensity is low, the relationship between innovative efforts and performance is negative. Furthermore, the results reveal that competitive intensity has a positive relationship to the level of innovative efforts but has a negative relationship to performance
Using International Trade Data for Evaluating the Product Specific Competitiveness and Supplied Product Quality of Countries: A Successful Example of Applied Theory
Get PDFThis paper proposes a simple regression-based method for reducing the complexity of decisions in the international procurement process. Based on foreign trade data, the method uses indicators, which allow a product specific cross-section and longitudinal-section valuation of the international competitiveness and the supplied product quality of all potential supplier countries. The method thus provides a variety of information for procurement departments, including the present level and the dynamic of competitiveness and product quality for the potential supplier countries within every product group of the international product nomenclature (Combined System and the Harmonised System). Potential supplier countries --the companies of which have proven to be particularly competitive in the different product quality stages-- are identified. This pre-selection of countries enables the companies to limit their search for potential suppliers to the selected supplier countries. High search costs are subsequently reduced and trend prognoses can be constructed
An Examination of Perceived Quality, Satisfaction, and Loyalty Relationship: Applicability of Comparative and Noncomparative Evaluation
Get PDFThis paper evaluates alternative measurement approaches to investigating the relationship amongst perceived quality, customer satisfaction, and loyalty. The authors define and measure the constructs within a relative attitudinal framework and compare these results to a noncomparative or individual evaluation of brands. In addition, loyalty is measured by and defined as a behavioral and attitudinal loyalty. The object of this research is teh botol whilst the subjects are undergraduate students in Surabaya and Yogyakarta. The proposed model, with satisfaction as a mediator between quality and loyalty, is found to be an acceptable representation of data across three brands of teh botol and for both comparative and noncomparative evaluation. The use of relative attitude, however, indicates a much stronger relationship amongst perceived quality, satisfaction, and loyalty than the attitude towards a brand when they are performed in individual evaluation. With respect to predictive ability, this study’s findings suggest that comparative evaluation has higher degree of applicability than does noncomparative evaluation
The Existence of Overall Satisfaction in Service Customer Relationships
Get PDFGarbarino and Johnson (1999) find that there is no correlation between overall satisfaction and loyalty in the field of customer relationship. Their finding indicates that satisfaction is no longer an important issue in managing service organizations. This research investigates the existence of satisfaction in service organizations, which have relationships with customers. Contrary to Garbarino and Johnson’s (1999) finding, this research finds that overall satisfaction, through commitment, has a relationship with loyalty. Hence, customer satisfaction is still a main issue with respect to managing service organizations, especially service organizations that have customer-relationship strategy. Survey method was conducted to test 12 hypotheses, and the sample of this research is customers of credit cardholders and supermarket cardholders. Sample size is 382 consisting of 196 (51.3%) credit cardholders and 186 (48.7%) supermarket cardholders. Data were analyzed using two-step structural equation modelling technique. In addition, this research also shows that investigators and managers should pay attention to affects, because affects have a unique role in relationship customer behavior
Factors Explaining Management Preferences of Accounting for Goodwill Prior to the Implementation of IFRS 3: A Cross-Country Study
Get PDFThis study provides evidence on the cross sectional relationship between firm economic variables and management preferences in the selection of an accounting technique for goodwill. It examines goodwill accounting policy disclosures in the 2000/2001 annual reports of 269 listed companies in the five countries: Australia, Hong Kong, Indonesia, Malaysia, and Singapore. The key focus is management’s choice of accounting techniques for the treatment of goodwill.The results show that accounting practices for goodwill vary significantly across country of origins and across industry groups. Two economic variables significantly explain management preferences of accounting for goodwill. The finding shows that the higher a company’s financial leverage ratio the company managers prefer to write off goodwill immediately against income or to capitalize and amortize it in a sorter period of time. The higher a company’s size, the more likely the company would write-off of goodwill to balance sheet reserves. Thus, this study provides empirical evidence that management preferences of accounting for goodwill have economic consequences
Predicting TUrnover Intentions of Hotel Employees: The Influence of Employee Development Human Resource Management Practices and Trust in Organization
Get PDFThis study investigates the variables that may be predictive of hotel employees’ turnover intentions. The influence of trust in organization as a mediator in the proposed relationship is also examined. A total of 380 operational employees from 5-star rated hotels completed the questionnaires. Hierarchical regression analysis was used to test the relationships hypothesized in the model. Most of the hypotheses were supported. It is suggested that to enhance employees’ trust in organization and subsequently to reduce turnover intentions, hotels need to continue to provide training and development programs to their employees, conduct fair and formal appraisal system, and provide ample and clear career advancement to their employees. Limitations and suggestions for future studies are forwarded
Who Moves the Malaysian Stock Market— the U.S. or Japan?: Empirical Evidence from the Pre-, During, and Post-1997 Asian Financial Crisis
Get PDFThis paper examines long run co-movements between Malaysian stock market and the two largest stock markets in the world: the U.S. and Japan. By employing time-series analysis, i.e., cointegration, variance decompositions, and impulse response functions, the paper seeks to investigate which market actually leads the Malaysian stock market before, during, and after the 1997 Asian financial crisis periods. The results indicate that there is a co-movement of these markets only in the post crisis period. The Japanese stock market is found to significantly move the Malaysian stock market compared to U.S. stock market for the post-crisis period. At the same time, there seems to be a growing proportion of bilateral trade between Malaysia and Japan during the mentioned period. This finding seems to be consistent with the view that the stronger the bilateral trade ties between two countries, the higher the degree of co-movements (Masih and Masih 1999; Bracker et al. 1999; Pretorius 2002; Ibrahim 2003; Kearney and Lucey 2004). Our finding implies that the opportunities of gaining abnormal profits through investment diversification during the post-crisis period in the Malaysian and Japanese stock markets are diminishing as the markets move towards a greater integration. This further implies that any development in the Japanese economy has to be taken into consideration by the Malaysian government in designing policies pertaining to Malaysian stock market
The Role of Noninstrumental Justice and Age in Predicting Organizational Commitment: Evidence from Malaysia
Get PDFThe purpose of this paper is to determine the influence of the noninstrumental component of procedural justice on organizational commitment and whether this relationship is moderated by age. Regression analysis on a sample of 161 employees revealed that noninstrumental procedural justice had a significant effect on organizational commitment. The hypothesis concerning the role of age as a moderator was not supported. Implications for managerial practice and future research are discussed
PSYCHOLOGICAL CONTRACT VIOLATION AND ORGANIZATIONAL CITIZENSHIP BEHAVIOR
Get PDFA psychological contract is an implicit understanding between a group of employees and their employer that arose as a result of a particular leadership style. Psychological contract violation (PCV) is said to occur when there is a perceived breach of promise that leads to an emotional and affective response. The literature on PCV posits a number of antecedents and outcomes of PCV. This study seeks to develop a model of PCV by linking it with justice and organizational citizenship behavior (OCB). It is argued that the antecedents of PCV lead to a sense of injustice. These will then create the emotional response that is indicative of PCV. It is also argued that an outcome of this PCV experience is reduced OCB and the emergence of a new outlook towards employment relationship. Data was collected from a Malaysian company that initiated a voluntary separation scheme as part of an effort to downsize its work force. The finding of this study provides partial support for the model