The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia

Ratna Emilia; Ratna Wardhani

The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia

Department of Accounting

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › peer-review

Abstract

This research aims to examine the impact of political connection on cost of debt with corporate governance as moderating variable. Sample of this thesis are non-financial industries companies which listed in Indonesian Stock Exchange on 2012-2015 with total 176 companies. The measurement of political connection in this study using Faccio (2006) model and the cost of debt measurement using Bliss and Gul (2012) model. The first result of this thesis indicates that political connection has positive influence on cost of debt. Second, corporate governance has negative impact on cost of debt. Third, corporate governance as a moderating variable strengthen the positive relation between political connection and cost of debt. The implication of this thesis is by the presence of the influence of political connection in the company, can reduce the cost of debt are getting higher due the creditor assumes that the company which has political connection riskier than a company that did not have any political connection. Good corporate governance can reduce the impact of political connection.

Original language	English
Title of host publication	Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019
Subtitle of host publication	Education Excellence and Innovation Management through Vision 2020
Editors	Khalid S. Soliman
Publisher	International Business Information Management Association, IBIMA
Pages	9399-9409
Number of pages	11
ISBN (Electronic)	9780999855126
Publication status	Published - 1 Jan 2019
Event	33rd International Business Information Management Association Conference: Education Excellence and Innovation Management through Vision 2020, IBIMA 2019 - Granada, Spain Duration: 10 Apr 2019 → 11 Apr 2019

Publication series

Name	Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020

Conference

Conference	33rd International Business Information Management Association Conference: Education Excellence and Innovation Management through Vision 2020, IBIMA 2019
Country/Territory	Spain
City	Granada
Period	10/04/19 → 11/04/19

Keywords

Corporate governance
Cost of debt
Political connection

Cite this

Emilia, R., & Wardhani, R. (2019). The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia. In K. S. Soliman (Ed.), Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020 (pp. 9399-9409). (Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020). International Business Information Management Association, IBIMA.

Emilia, Ratna ; Wardhani, Ratna. / The impact of political connection on cost of debt with corporate governance as a moderating variable : Evidence from Indonesia. Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020. editor / Khalid S. Soliman. International Business Information Management Association, IBIMA, 2019. pp. 9399-9409 (Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020).

@inproceedings{517741d548fa4acd8c9cc7baf6ab9c7b,

title = "The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia",

abstract = "This research aims to examine the impact of political connection on cost of debt with corporate governance as moderating variable. Sample of this thesis are non-financial industries companies which listed in Indonesian Stock Exchange on 2012-2015 with total 176 companies. The measurement of political connection in this study using Faccio (2006) model and the cost of debt measurement using Bliss and Gul (2012) model. The first result of this thesis indicates that political connection has positive influence on cost of debt. Second, corporate governance has negative impact on cost of debt. Third, corporate governance as a moderating variable strengthen the positive relation between political connection and cost of debt. The implication of this thesis is by the presence of the influence of political connection in the company, can reduce the cost of debt are getting higher due the creditor assumes that the company which has political connection riskier than a company that did not have any political connection. Good corporate governance can reduce the impact of political connection.",

keywords = "Corporate governance, Cost of debt, Political connection",

author = "Ratna Emilia and Ratna Wardhani",

year = "2019",

month = jan,

day = "1",

language = "English",

series = "Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020",

publisher = "International Business Information Management Association, IBIMA",

pages = "9399--9409",

editor = "Soliman, {Khalid S.}",

booktitle = "Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019",

note = "33rd International Business Information Management Association Conference: Education Excellence and Innovation Management through Vision 2020, IBIMA 2019 ; Conference date: 10-04-2019 Through 11-04-2019",

}

Emilia, R & Wardhani, R 2019, The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia. in KS Soliman (ed.), Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020. Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020, International Business Information Management Association, IBIMA, pp. 9399-9409, 33rd International Business Information Management Association Conference: Education Excellence and Innovation Management through Vision 2020, IBIMA 2019, Granada, Spain, 10/04/19.

The impact of political connection on cost of debt with corporate governance as a moderating variable : Evidence from Indonesia. / Emilia, Ratna; Wardhani, Ratna.

Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020. ed. / Khalid S. Soliman. International Business Information Management Association, IBIMA, 2019. p. 9399-9409 (Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020).

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › peer-review

TY - GEN

T1 - The impact of political connection on cost of debt with corporate governance as a moderating variable

T2 - 33rd International Business Information Management Association Conference: Education Excellence and Innovation Management through Vision 2020, IBIMA 2019

AU - Emilia, Ratna

AU - Wardhani, Ratna

PY - 2019/1/1

Y1 - 2019/1/1

N2 - This research aims to examine the impact of political connection on cost of debt with corporate governance as moderating variable. Sample of this thesis are non-financial industries companies which listed in Indonesian Stock Exchange on 2012-2015 with total 176 companies. The measurement of political connection in this study using Faccio (2006) model and the cost of debt measurement using Bliss and Gul (2012) model. The first result of this thesis indicates that political connection has positive influence on cost of debt. Second, corporate governance has negative impact on cost of debt. Third, corporate governance as a moderating variable strengthen the positive relation between political connection and cost of debt. The implication of this thesis is by the presence of the influence of political connection in the company, can reduce the cost of debt are getting higher due the creditor assumes that the company which has political connection riskier than a company that did not have any political connection. Good corporate governance can reduce the impact of political connection.

AB - This research aims to examine the impact of political connection on cost of debt with corporate governance as moderating variable. Sample of this thesis are non-financial industries companies which listed in Indonesian Stock Exchange on 2012-2015 with total 176 companies. The measurement of political connection in this study using Faccio (2006) model and the cost of debt measurement using Bliss and Gul (2012) model. The first result of this thesis indicates that political connection has positive influence on cost of debt. Second, corporate governance has negative impact on cost of debt. Third, corporate governance as a moderating variable strengthen the positive relation between political connection and cost of debt. The implication of this thesis is by the presence of the influence of political connection in the company, can reduce the cost of debt are getting higher due the creditor assumes that the company which has political connection riskier than a company that did not have any political connection. Good corporate governance can reduce the impact of political connection.

KW - Corporate governance

KW - Cost of debt

KW - Political connection

UR - http://www.scopus.com/inward/record.url?scp=85074091672&partnerID=8YFLogxK

M3 - Conference contribution

T3 - Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020

SP - 9399

EP - 9409

BT - Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019

A2 - Soliman, Khalid S.

PB - International Business Information Management Association, IBIMA

Y2 - 10 April 2019 through 11 April 2019

ER -

Emilia R, Wardhani R. The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia. In Soliman KS, editor, Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020. International Business Information Management Association, IBIMA. 2019. p. 9399-9409. (Proceedings of the 33rd International Business Information Management Association Conference, IBIMA 2019: Education Excellence and Innovation Management through Vision 2020).

The impact of political connection on cost of debt with corporate governance as a moderating variable: Evidence from Indonesia

Abstract

Publication series

Conference

Keywords

Other files and links

Fingerprint

Cite this