IDEAS home Printed from https://ideas.repec.org/a/taf/oaefxx/v8y2020i1p1822018.html
   My bibliography  Save this article

Agency conflicts, firm value, and monitoring mechanisms: An empirical evidence from Indonesia

Author

Listed:
  • Faisal Faisal
  • M. Shabri Abd Majid
  • A. Sakir
  • David McMillan

Abstract

Using a linear model, previous studies on the ownership concentration–firm performance nexus have produced inconsistent empirical findings and found no consensus concerning the measure of agency conflict control mechanism. Using a non-monotonic model and a combination of agency conflict control mechanisms, this study contributes to the existing literature by examining the moderating roles of additional blockholders, dividends, foreign ownership types in determining the effect of ownership concentration on performance of 580 Indonesia’s firms during the 2009–2018 period. Employing panel piecewise and moderated regression models, the study documented that the ownership concentration–firm performance relationship had followed a non-monotonic pattern, proving both monitoring and expropriation hypotheses exist for non-financial firms in Indonesia. These findings highlighted the important role of additional blockholders, dividends, foreign ownership types as moderating variables, and debt as a predictor to influence firm performance, functioning as the control mechanisms for the agency conflicts in Indonesia.

Suggested Citation

  • Faisal Faisal & M. Shabri Abd Majid & A. Sakir & David McMillan, 2020. "Agency conflicts, firm value, and monitoring mechanisms: An empirical evidence from Indonesia," Cogent Economics & Finance, Taylor & Francis Journals, vol. 8(1), pages 1822018-182, January.
    • Handle: RePEc:taf:oaefxx:v:8:y:2020:i:1:p:1822018
    DOI: 10.1080/23322039.2020.1822018
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23322039.2020.1822018
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23322039.2020.1822018?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tong, Tong & Chen, Xiaoyue & Singh, Tarlok & Li, Bin, 2022. "Corporate governance and the outward foreign direct investment: Firm-level evidence from China," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 962-980.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oaefxx:v:8:y:2020:i:1:p:1822018. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/OAEF20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.