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Corporate investment, financing, and dividend policies in the high-tech industry

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  • Wang, David Han-Min
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    Abstract

    The agency theory, transactional cost economics, and traditional strategic management perspectives have provided several key corporate financial policies. However, these policies have generally been discussed and established separately. This study explores the causal structure of corporate financial strategies for the high-tech firms in Taiwan and China. By employing path analysis and directed graphs model, this paper explores the causal relationships among investment, financing, dividend policies, and corporate performance. The results show that the investment expenditures by Taiwan's firms positively affect financial performance and the increased borrowings jeopardize company's profits. However, the financing decisions of China's firms have a positively effect on their capital expenditures. The findings suggest that firms across the Strait adopt different strategies in financial decision environments.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Business Research.

    Volume (Year): 63 (2010)
    Issue (Month): 5 (May)
    Pages: 486-489

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    Handle: RePEc:eee:jbrese:v:63:y:2010:i:5:p:486-489

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    Web page: http://www.elsevier.com/locate/jbusres

    Related research

    Keywords: Causal relationship Directed graphs model Financial policy Path analysis;

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    Cited by:
    1. Schoubben, Frederiek & Van Hulle, Cynthia, 2011. "Stock listing and financial flexibility," Journal of Business Research, Elsevier, vol. 64(5), pages 483-489, May.
    2. Deng, Lu & Li, Sifei & Liao, Mingqing & Wu, Weixing, 2013. "Dividends, investment and cash flow uncertainty: Evidence from China," International Review of Economics & Finance, Elsevier, vol. 27(C), pages 112-124.
    3. Hsu, Po-Hsuan & Wang, Chong & Wu, Chaopeng, 2013. "Banking systems, innovations, intellectual property protections, and financial markets: Evidence from China," Journal of Business Research, Elsevier, vol. 66(12), pages 2390-2396.

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