Gadjah Mada International Journal of Business
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TAX COSTS AND CORPORATION DIVIDEND POLICY: Evidence from the 1986 U.S. Tax Reform Acts
Get PDFScholes and Wolfson (1992) predict that following the 1986 TaxReform Act, the tax cost of the corporate form relative to that of the partnership form (the incremental tax cost) increased significantly. This study hypothesizes that since dividends represent a tax disadvantaged form of income relative to capital gains, then in response to an increase in incremental tax costs, corporations would decrease their dividend payout ratios. The response is expected to be stronger for corporations owned byshareholders with long investment horizons because the tax cost saved from decreasing dividend payout ratios is an increasing function of shareholders’ investment horizon. The empirical tests support the hypothesis and show a negative relationship between the change in incremental tax costs and the change in dividend payout ratios for firms with long average investment horizons
THE PREDICTIVE CONTENT OF DISAGGREGATED NORMAL INCOME: An Empirical Study in the JSX
No full textThe main objective of this study is to examine a hypothesis that the predictive content of normal income disaggregated into operating income and nonoperating income outperforms that of aggregated normal income in predicting future cash flow. To test the hypothesis, linear regression models are developed. The model parameters are estimated based on fifty-five manufacturing firms listed in the Jakarta Stock Exchange (JSX) up to the end of 1997.This study finds that empirical evidence supports the hypothesis. This evidence supports arguments that, in reporting income from continuing operations, multiple-step approach is preferred to single-step one
DETERMINANTS OF ENTREPRENEURIAL INTENTION: The Case of Norwegian Students
Get PDFThis paper aims to identify determinants of entrepreneurial intentions among young people. The empirical basis is Norwegian students, while an objective is also to create a basis for comparative studies among different economic and cultural contexts. Independent variables in the study include demographic factors and individual background, personality traits, and contextual elements like access to capital and information. The individual perceptions of self-efficacy and instrumental readiness are the variables that affect entrepreneurial intentions most significantly. Age, gender and educational background have no statistically significant impact. Generally, the level of the entrepreneurial intentions among Norwegian students is relatively low, which may be explained by social status and economic remuneration of entrepreneurs compared with employees in the Norwegian context
NORMATIVE MODERATORS OF IMPULSE BUYING BEHAVIOR
Get PDFPrior research has presented the moderating role of normative evaluations in the relationship between the impulsive buying trait and consumers’ buying behaviors. In this article the authors show that consumer tendency to buy something spontaneous, unreflectively and immediately can be perceived as a factor which describes buying impulsiveness. This article also shows conceptual and empirical evidence that there is some support for the moderating role of normative evaluations in the relationship between buying impulsiveness and impulse buying behaviors. Significance occurs when consumers believe that act on impulse is suitable. The result suggests that consumers’ normative evaluation can moderate the link between the trait and behavioral aspects of impulse buying
SERVICE QUALITY: Understanding customer Perception and Reaction, and Its Impact on Business
No full textThis paper is an attempt to explain the process and outcomes of customer services levels and how they shape customer perceptions (of their relationship with services providers) and reactions. As an entirely conceptual work, this paper proposes a model for understanding the pathway and the end of good and bad customer service. Implications of the study on theory and practice are discussed
FORMALIZING PRODUCT COST DISTORTION: The Impact of Volume-Related Allocation Bases on Cost Information
No full textThe purpose o f this study is to formally analyze product cost distortions resulting from the process of allocating costs to products based on Activity-Based Costing (ABC) and the conventional product costing systems. The model developed in this paper rigorously shows the impact of treating costs that are not volume related as if they are. The model demonstrates that the source of product cost distortion is the difference between the proportion of driver used by each product in ABC and the proportion of the base used by the same product in the conventional costing systems. The difference arises because the conventional costing systems ignore the existence of batch-related and product-related costs. The model predicts a positive association between volume and size diversity with product cost distortions. When interaction between volume and size diversity exists, the distortion is either mitigated or exacerbated. The magnitude of the distortion is jointly determined by the size of the differences and the size of the total indirect costs
FACTORS AFFECTING EFFECTIVENESS OF CHANGE INITIATIVES: Evidence from Malaysian Firms
Get PDFThis paper investigates various system models and change guidelines that deal with the dynamics of successful change. It seeks to find out whether Malaysian organizations which have achieved successful change outcomes would have also managed the change process in accordance to the general guidelines derived from the literature on effective management of change. Primary data for this study was obtained by conducting a mailed questionnaire survey among executives and managers of seventeen Malaysian organizations. The main method of analysis is by looking at the correlation between an organization’s scores on the relevant items in the change process scales and the organization’s perceived effectiveness of change, as measured by the organization’s change effectiveness scores.The general finding confirms and reinforces the literature on effective change management. It was found that organizations that were perceived by staff to have achieved successful change outcomes, were also perceived to have managed the change processes well in accordance to general principles derived from research on organizational change
A MECHANISM AND DETERMINANTS OF AN AGENCY-COST EXPLANATION FOR DIVIDEND PAYMENTS
No full textThis study explains the dividend puzzle using the agency-cost frame work suggested by Easterbrook (1984). Easterbrook hypothesized that shareholders in firms, who increase cash dividend payout and ‘simultaneously' raise debts to finance their investments are likely to be wealthier than those in firms who only increase their cash dividend payout. He provided the mechanism that shareholders use the dividend payments to force managers to go to the capital markets to raise funds. Therefore, he argued that dividend policy influences the financing policy. A system of simultaneous equation using three-stage generalized least square method is used to test the hypotheses. Among the variables to proxy the investment opportunity set, market-to-book ratio, market-to-book assets ratio and accounting earnings-per-share-to-price ratio are the best proxies. Attempt is made to obtain better proxies for the investment opportunity set using an instrument variable method. The system is robust to alternate investment opportunity variables as well as to the instrumental variables. The findings are as follows. For the firms that increase cash dividend payout and raise debt simultaneously, (a) dividend policy is not a shareholders' mechanism, but a manager's accounting-based decision with accounting earnings and retained earnings as the major determinants, (b) dividend policy influences financing policy, but not the other way around, (c) increasing dividend payment decreases shareholders' wealth, but increasing debt subsequently increases shareholders' wealth with a net effect positive to shareholders' wealth, and (d) dividend policy is independent from investment policy
The Consumption Paradigm in Marketing
No full textThis article elaborates consumption paradigm in marketing. In background, this paper reviews different perspectives of consumption: economic perspective and marketing perspective. In ontology, this work describes various issues regarding consumption view. In epistemology, this article demonstrates how marketers especially researches explore the consumption phenomena. In methodology, the article describes experiential marketing –one of applied consumption paradigm in marketing, which could be an alternative choice of marketing practices
PRICE ANDVOLUME EFFECTS ASSOCIATED WITH CHANGES IN THE LQ 45 INDEX AND THE MSCI EQUITY INDEX LISTS
No full textThis paper examines price and trading volume behavior surrounding announcements of changes in the composition of the liquidity (LQ) 45 and the Morgan Stanley Capital International (MSCI) Equity Index at the Jakarta Stock Exchange. Unlike listing studies in the developed markets, the announcements of the LQ45 Index changes have no impact on share price and trading volume. This may be due to the small role of Indonesian domestic institutional investors and purely rule-based characteristics of the LQ45 Index. On the contrary, the markets do respond to the changes in Indonesian stocks composition of the MSCI Equity Index. It seems that global portfolio managers, who dominate trading at the Jakarta Stock Exchange, rebalanced their portfolio when the changes in the MSCI Equity Index occurred because their performances are generally benchmarks to the return on the Index