Revisiting capital structure theory : a test of pecking order and static order trade-of model from Malaysian capital market

This study revisits the capital structure theory and test Pecking Order Hypothesis (POH) and Static Order Trade-off theory (STOT) using Malaysian Listed firms over a period from 1999 to 2002. The evidence from pecking order model suggests that the internal fund deficiency is the most important determinant that possibly explains the issuance of new debt in Malaysian capital market despite the lower predicting power.  While static trade off-model is not fit to explain the issuance of new debt issue in Malaysian capital market. This is an interesting findings that confirm the fact that Malaysian firms do not too much care about tax-shield benefit derive from employ both debt and non-debt tax-shield. The finn's size, which is used to neutralize the size effect, appears to provide some explanation for the variation in its capital structure policy choice; however asset structure and growth no evidence of static-order-trade-off is observed in Malaysian capital market.

Information ratings and capital structure

We examine the impact of information asymmetry on a firm's capital structure decisions with a unique information rating scheme that draws from 114 measures over five dimensions of information disclosures on each firm from 2006 to 2012. We find that a firm with high (low) information rating is related to low (high) debt financing and leverage. In particular, a firm that moves from the lowest to the highest information rating experiences a 7.8% reduction in firm leverage on average. This relationship is robust to firm characteristics, incentive conflicts, and the agreement theory of Dittmar and Thakor (2007). Our results suggest that information asymmetry is in-fluential on a firm's pecking order behavior independent of these effects.

Applicability of financial theories of capital structure to the Chinese cultural context: a study of privately owned SMEs

Using a new dataset of 1539 Chinese small and medium-sized enterprises this article investigates the firm-level determinants of capital structure and tests them against the predictions of financial theory. Firm size and profitability are both found to be related to leverage as posited by pecking-order theory. In contrast little support is found for the predicted relationship between asset structure and leverage. These findings are discussed in relationship to their Chinese cultural context. The managerial and policy implications of the research are then explored.

Determinants of capital structure of A-REITS and the global financial crisis

This paper contributes to the capital structure literature by investigating the determinants of capital structure of Australian Real Estate Investment Trusts (A-REITs) over the period 2006-2009. By using a panel approach and a Global Financial Crisis (GFC) dummy variable, our analysis incorporates the Global Financial Crisis (GFC) shock which appears to have affected the market after December 2007. We find that A-REIT size, profitability, tangibility, operating risk and number of growth opportunities impact similarly to many previous studies of international entities upon the degree of leverage. We also find mixed support for prevailing capital structure theories of Pecking Order, Trade-off and Agency Theory, but find that Market Timing Theory can be rejected over our sample period. With specific focus after onset of the GFC, we find that the relationship between capital structure and our independent variables is somewhat distorted. Consequently, the postulations of theory also become distorted whereby changes to capital structure come about because of the primary goal to survive, rather than managerial opportunism.

How do SMEs with single and multiple owners finance their operations differently? Empirical evidence from China

We study the impact of firm-level characteristics on the capital structures of private small and medium-sized enterprises (SMEs) as well as the differences between the capital structures adopted by SMEs with single and multiple owners in China. Our findings highlight the limited use of asset-based financing by Chinese SMEs. We also find that the propensity of SMEs with single-owners to use external debt was significantly less than those with multiple owners. Furthermore, our findings suggest that single-owned firms are subject to a more constrained pecking order than those with multiple owners.

An order-based theory of morality

The thesis argues that morality has a non-religious basis in the human need for order. Our need for order explains why we are the moral beings that we are. It also explains the kind of morality that people variously advocate and practice.

Reduced-order output feedback controllers for discrete-time systems

This article considers the stabilization by output feedback controllers for discrete-time systems. The controller can place all of the closed-loop poles within a specified disk D(-α, 1/β), centred at (-α,0) with radius 1/β, where | - α|  + 1/β < 1. The design method involves the decomposition of the system into two portions. The first portion comprises of all of the poles that are lying outside of the specified disk. A reduced-order model is constructed for this portion. The second portion comprises of all of the remaining poles of the system and is characterized by an H_∞-norm bound. The controller design is then accomplished by using H_∞-control theory. It is shown that, subject to the solvability of an algebraic Riccati equation, output feedback controllers can be systematically derived. The order of the controller is low, and can be as low as the number of the open-loop poles that are lying outside of the specified disk. A step-by-step design algorithm is provided. Numerical examples are given to illustrate the attractiveness of the design method.

Zygmunt Bauman : order, strangerhood and freedom

In the final decades of the 20th century, issues such as identity, Otherness and the role of social and cultural boundaries have been prominent in social theory, sociology and cultural studies. In this context, an analysis of Bauman's work is important because it raises pertinent questions pertaining to the nature of social and cultural boundaries and the nature of boundary construction under modernity. The metaphors of inside and outside and the idea of the boundary are significant in Bauman's critique of modernity's search for a meta-order and in his examination of strangerhood. The article illustrates how this ordering process manifests itself at the individual and societal levels of modernity. Bauman's contention is that modernity's search for a meta-order leads to the construction of boundaries and to exclusionary practices. It is the presence of the Third, for Bauman, which threatens the certainty of order. Different images of the stranger in Bauman's work are identified and the ways in which Bauman's conception of freedom and `community' is intrinsically linked to his work on the ambivalent stranger are demonstrated.

Experiential learning in social science theory: an investigation of the relationship between student enjoyment and learning

This paper provides an analysis of student experiences of an approach to teaching theory that integrates the teaching of theory and data analysis. The argument that supports this approach is that theory is most effectively taught by using empirical data in order to generate and test propositions and hypotheses, thereby emphasising the dialectic relationship between theory and data through experiential learning. Bachelor of Commerce students in two second-year substantive organisational theory subjects were introduced to this method of learning at a large, multi-campus Australian university. In this paper, we present a model that posits a relationship between students' perceptions of their learning, the enjoyment of the experience and expected future outcomes. The results of our evaluation reveal that a majority of students:

•enjoyed this way of learning;
•believed that the exercise assisted their learning of substantive theory, computing applications and the nature of survey data; and
•felt that what they have learned could be applied elsewhere.

We argue that this approach presents the potential to improve the way theory is taught by integrating theory, theory testing and theory development; moving away from teaching theory and analysis in discrete subjects; and, introducing iterative experiences in substantive subjects.

Moving from the quality of life concept to a theory

BACKGROUND: The Special Interest Quality of Life Group has updated its set of statements defining the quality of life (QOL) construct to reflect emerging areas of agreement and the framework for understanding better the QOL construct.
METHOD: This article examines the major areas currently under discussion involving the objective-subjective dichotomy, needs, and core domains.
RESULTS: It is concluded that while the new statements constitute a significant advance, further progress requires testable theory. In order to facilitate such future research, a conceptual model is proposed that distinguishes causal and indicator variables within the framework of a homeostatic management system.
CONCLUSION: Several lines of empirical investigation are suggested to test this and similar theoretical models with a view to taking our conceptualization of QOL to the next level.

Optimal provisioning theory and regulatory distortions

Firms must often invest in large-scale capacity expansions in order to service their expectation of future demand. This is known as provisioning. This paper introduces and examines issues and contributions in optimal provisioning theory. It discusses some regulatory distortions and suggests how an awareness of optimal provisioning can improve regulatory outcomes.

Decades of research efforts to link economic and environmental performance: still data in search of a theory?

With the proliferation of social investment vehicles, stakeholders, particularly investors, are increasingly aware of the relationship between economic, social and environmental performance, and disclosure to external parties. This is particularly evident in The Securities and Exchange Commission's Environmental Disclosure Rules. The thesis of this paper is that, after three decades of academic and professional research efforts, there are still no firm proactive guidelines to firmly link the financial performance with environmental and social performance. The purpose of this paper is to revisit empirical research efforts spanning three decades in order to delineate potential links that may assist in systematic, comparable reporting

Complexity theory and organizing form dualities

Purpose – The purpose of this paper is to describe how order-generated rules applied to organizing form dualities can assist in creating the conditions for emergent, self-organized behavior in organizations, thereby offering an operational deployment of complexity theory.

Design/methodology/approach – The paper begins by showing that the concept of dualities is consistent with complexity-thinking. In addition, when applied to organizing forms, dualities represent a practical way of affecting an organization's balance between chaos and order. Thus, when augmented with order-generating rules, organizing form dualities provide an access point for the practical instigation of edge of chaos conditions and the potential for emergence.

Findings – The paper maintains that many attempts to “manage” complexity have been associated with changes to organizing forms, specifically toward new forms of organizing. It is suggested that organizing form dualities provide some management guidance for encouraging the “edge of chaos” conditions advocated in complexity theory, although the details of self-organization cannot be prescribed given the assumptions of non-linearity associated with complexity theory perspectives. Finally, it is proposed that organizing dualities can elucidate the nature and application of order-generating rules in non-linear complex systems.

Practical implications – Dualities offer some guidance toward the practical implementation of complexity theory as they represent an accessible sub-system where the forces for order and chaos – traditional and new forms of organizing respectively – are accessible and subject to manipulation.

Originality/value – The commonalities between dualities and complexity theory are intuitive, but little conceptual work has shown how the former can be employed as a guide to managing organizing forms. Moreover, this approach demonstrates that managers may be able to stimulate “edge of chaos” conditions in a practical way, without making positivistic assumptions about the causality associated with their efforts.