Abstract: This research analyses the influence of agency cost—using percentage of stock ownership by various clusters as proxy measurements, namely institutional ownership, insider ownership, and ownership dispersion (stock ownership by the public)—market risk (beta), and investment opportunities on dividend policy. The population in this research is companies listed on the Indonesia Stock Exchange during a 2005–2008 observation period, using purposive sampling as a sampling technique. This research was designed as descriptive research and verification of this research was carried out using secondary data. Data was analysed by using data panel regression analysis and the statistical hypothesis was tested with the F-test and t-test. The result of the research and testing of the hypothesis indicates that variables such as institutional ownership, insider ownership, and ownership dispersion (public ownership), plus market risk, and investment opportunities significantly influence dividend policy. Partial institutional ownership, ownership dispersion (public), and investment opportunity have a positive and significant impact on the dividend policy at α = 0.05, insider ownership influence is also positive and significant at α = 0.1, while the beta has a positive but not significant effect.
Keywords: agency cost, beta, investment opportunities, and dividend.
Title: The Influence of Agency Cost, Market Risk, and Investment Opportunities on Dividend Policy
Author: DADANG PRASETYO JATMIKO
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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