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How do political connection and intellectual capital affect the debt usage of majority shareholders? Evidence in Indonesia

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  • Adi Kurniawan Yusup
  • Cicilia Erna Susilawati

Abstract

This research intends to examine majority shareholder ownership's effect on debt moderated by political connection and intellectual capital. This study uses 747 firm-year observations of non-financial companies in Indonesia from 2018-2020. The finding shows that majority ownership has an inverted U-shape relationship on debt, but its effect is less significant in non-family firms. Political connection does not act as a moderator, while intellectual capital does only for family firms. Meanwhile, political connection and intellectual capital together alleviate majority ownership and debt relationship for both types of companies.

Suggested Citation

  • Adi Kurniawan Yusup & Cicilia Erna Susilawati, 2023. "How do political connection and intellectual capital affect the debt usage of majority shareholders? Evidence in Indonesia," International Journal of Business and Emerging Markets, Inderscience Enterprises Ltd, vol. 15(1), pages 34-52.
    • Handle: RePEc:ids:ijbema:v:15:y:2023:i:1:p:34-52
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