Abstract

This research examines the influence of dividend policy and leverage on firm value with agency cost as an intervening variable in manufacturing companies in the consumer goods industry sector listed at Indonesia Stock Exchange in the period of 2012-2016. The type of research used is associative research. Anumber of populationin this research are 42 firms. Sampling technique used purposive sampling, so selected 14 firms as research sample.Research variables consist of Dividend policy proxied byDividend Per Share (DPS), Leverage proxied byDebt to Equity Ratio (DER), Agency cost proxied by effectiveness, and firm value proxied byPrice to Book Value (PBV).Data analysis uses simple regression, path analysis, and Sobel test.The research resultindicates that dividend policy has a significant negative effect on Agency cost. Leverage has a negative significant effect on Agency cost. Dividend policy has a significant positive effect on firm value. Leverage has a significant positive effect on firm value. Agency cost has a significant negative effect on firm value. The test results using path analysis and sobel test show that Agency cost is able to mediate the influence of dividend policy on firm value. Nevertheless, Agency cost is unable to mediate the effect of leverage on firm value.
 
 Keywords : Firm value, Dividend policy,Leverage, Agency cost, Intervening variable

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