Romantic or Classical

Matthew Arnold’s â€Å"The Function of Criticism at the Present Time† is a criticism in itself of what great literary artists could have done and what literature could have become. In depth, Arnold’s work discusses his critical and personal perspectives on the role of criticism in consequentially transforming not only literature but also the landscape of society positively and constructively as well.Furthermore, Arnold sought to strengthen his arguments on the matter and present a rebuttal of the various criticisms put forth against his ideas and points of view, and prove that criticisms are of great importance in fuelling creativity and fostering the advancement of literature. However, Arnold implicitly distinguished differences between the positive and constructive types of criticism as compared to the off-putting and unconstructive nature of some criticism.Arnold argued that â€Å"a critic may with advantage seize an occasion for trying his own conscience, an d for asking himself of what real service, at any given moment, the practice of criticism either is or may be made to his own mind and spirit, and to the minds and spirits of others. † (pp. 414) Arnold’s arguments on the ideal nature of critics formulated his perspectives on how and when criticisms may be considered valuable.Under the pretexts of Arnold’s arguments, we realize that unless criticisms are aimed towards the greater good – that is, to present censures and critiques for the purpose of fuelling creativity, fostering change and advancement, and ultimately to affect a change that would positively and constructively change the lives of man and the landscape of society – they are deemed ineffectual or inadequate. Arnold also discussed creativity under the context of developing literature.Arnold said, â€Å"It is undeniable that the exercise of a creative power, that a free creative activity, is the highest function of man; it is proved to be so by man’s finding in it his true happiness. † (pp. 414) The multifaceted structure of the human mind allows man to express creativity in so many ways and create different outcomes out of it, such as the expression of creativity through developing criticisms and then consequently formulating good literature.The excerpt from Arnold’s â€Å"Sweetness and Light,† he explored the dynamics of culture based on the motivations that constitute a part of its bases or foundations. Arnold said, â€Å"Culture is then properly described not as having its origin in curiosity, but as having its origin in the love of perfection; it is a study of perfection. It moves by the force†¦ but also of the moral and social passion for doing good. † (pp.427-248) Since Arnold has framed the origins of culture not on mere curiosity, but on man’s desire to seek and create perfection, he said that culture then serves a greater purpose to creative positive and constr uctive change, accomplish human needs, and foster the convalescence of human nature. By and large, the arguments of Arnold meet the standards and dynamics of romantic aesthetics and poetry. Based on Wellek’s discussions on the Classical and Romantic movements, classical poetry was defined as â€Å"poetry for the dead† while romantic poetry was defined as â€Å"poetry for the living.† (pp. 259) The primary difference between the Classical and Romantic movements that set the distinction between the nature of classical and romantic poetry lies in the major themes that constitute the dynamics of each style. Wellek said, â€Å"Ancient religion and the life are past and gone, and hence classical, while for instance, America, discovered in modern times, is romantic. † (pp. 260) Since Arnold’s perspectives and arguments were related to the development of the present time, the society, and expansion of human nature, his views on poetry are romantic in natur e.2. Abram’s Theories of Art Abrams’ theories on art were primarily tied to the modernist perspective of criticism. In the discussion on the â€Å"Orientation of Critical Theories,† which were attributed to art, the modernist perspective of viewing, realizing the significance, and interpreting art focused on a single perspective, and that is of the artist, and not on the many factors that exist in art’s external environment that contribute criticism and interpretations to it.The aesthetic theory, as Abrams defined, â€Å"displays its full measure of rhetoric and logomachy which seem and inseparable part of man’s discourse about all things that really matter†¦ Its aim, however, is not to establish correlations between facts which will enable us to predict the future by reference to the past, but to establish principles enabling us to justify, order, and clarify our interpretation and appraisal of the aesthetic facts themselves. † (pp.2) Abrams’ definition of the aesthetic theory of viewing art leads us to understand that interpreting and labeling meanings on pieces of art should be based on established principles of aesthetics. On the other hand, the critical theory of viewing art â€Å"has its own kind of validity†¦ Such a criterion will, of course, justify not one, but a number of valid theories, all in their several ways of self-consistent, applicable, and relatively adequate to the range of aesthetic phenomena. † (pp.3) If the aesthetic theory of poetry lies in the principles and nature of aesthetics as seen on the perspective of the artist, the critical theory of viewing art is dependent on the existence of standards and decisive factors, which literally and actually define the features that make up art and the pennants that define aesthetics. Another theory of art criticism discussed by Abrams is the view of art within four elements or coordinates – the universe, the work, the artist , and the audience.In this theory, the interpretations of art are oriented in the perspectives of one of the factors within the external environment of art. The pragmatic theory, as opposed to the aesthetic and critical theories of viewing art sees art as a vehicle for the artist’s accomplishment of a higher goal or objective. Art, in this case, becomes a tool utilized to achieve something meaningful to the artist, or even the factors that constitute art’s external environment.If the pragmatic theory sees art as an instrument to do something, the expressive theory on the other hand, sees art as a vehicle to express the artist’s thoughts and emotions. Art, in this case, is personal that results from the artist’s thoughts and emotion translated to a concrete piece of art. Another theory defined by Abrams is the objective theory of viewing art. This particular theory focuses on the facts and standards of art.The act of viewing art is by looking at the art in itself, and not considering the thoughts and perspectives contributed by the factors existing in its external environment. Art, in this case, is seen and interpreted as is. Based on the definitions of Abrams of the different theories of viewing art, Eliot’s poetry subscribes the orientation of perspectives and interpretations of art to the four factors elements of coordinates of art, specifically the perspectives and interpretations of the audience, while Hulme’s poetry subscribes to the expressive and pragmatic theories of art criticism.Eliot himself defined the views and perspectives of art as something that should be personal and experienced by the audience, that is because the audience â€Å"enjoy the poetry† and not because the audience â€Å"acquired the scholarship† to appreciate art. (Scofield, pp. 1) Hulme’s poetry, on the other hand, was defined as an instrument to express language that is real, affecting or appealing to human emotions. (Comentale & Gasiorek, pp. 98) 3. Abram’s Theories in Virginia Woolf’s â€Å"Modern Fiction†Virginia Woolf’s â€Å"Modern Fiction† is an exploration of the features of art and literature from the past until present time, which sets apart classical art and literature and the modern representations of art and literature. Woolf discussed the two arguments on the difference between the concrete art and literature materials that constitute the classical and modernist perspectives, but ultimately admired the simplicity yet timelessness of classical works on art and literature.Woolf said, that the works of classical artists or writers â€Å"certainly have a strange air of simplicity† but were representations of â€Å"accomplishments that we can scarcely refrain from whispering that the fight was not so fierce for them as for us† considering the complexity and the demands of writing in our modern world. (Woolf) Certainly, there is something a bout the features of the classical perspectives on art and literature that allow them to withstand the passage of time and modernity, that is â€Å"the flesh of their work has a living, breathing, everyday imperfection which bids us take liberties with it we choose.† (Woolf) Woolf continues to set the distinction between the classical and modern literature in order to construct the framework of the foundations of modern literature that makes it incomparable to the eminence and distinction awarded to classical arts and literature. However, Woolf ascertained one thing, and that is, the dynamics and position of modern literature is still uncertain as compared to the solid standing of classical literature.After all, Woolf said, â€Å"We only know that certain gratitudes and hostilities inspire us, that certain paths seem to lead to fertile land, others to the dust and the desert, and of this perhaps it may be worthwhile to attempt some account. † (â€Å"Modern Fictionâ₠¬ ) By this, Woolf meant that art and literature is something unprompted and natural, which are borne out of the creativity of artists or literary writers. At this point, the foundations of modern literature have been presented as something that is compliant and accommodating to the artist or literary writer.While on the other hand, classical art and literature remains as forceful and influential because it talks about the realities of life. This feature or characteristic of classical art and literature seem to blur the standing or position of modern art and literature because its dynamics cannot be contained in a single word of definition due to its compliance to various factors, and that is on the varying perspectives of modern artists and writers. Woolf said, â€Å"this may be, the problem before the novelist at present, as we suppose it to have been in the past, is to contrive means of being free to set down what he chooses.He has to have the courage to say that what interests him is not longer ‘this’ but ‘that’: out of ‘that’ alone must he construct his work. † (â€Å"Modern Fiction†) In simpler terms, the desire and inclination of modern artists and literary writers to present something that deviates from established classical arts and literature become the problems and difficulties that challenge their courage and capability to present artistic and literary works set against the backdrop of our modern world.Based on the thoughts and points of view discussed by Woolf in â€Å"Modern Fiction,† we realize that it subscribes to the expressive theory and the coordinates of art criticism, specifically on the varying perspectives of art and literature from the viewpoint of the artist, the audience, and society or the world. Woolf has comprehensively discussed how modern literature constitutes the individual and unique expression of the artist or the writer, according to his personal perspectives and interest that deviate from established standards from the classical movement.4. Modernism The emergence of modernism as a trend in arts and literature, which consequently influenced the changes in the cultural and aesthetic identities in the West, was as Lewis put it, â€Å"has been gradual and imperceptible. † (â€Å"De Descriptione Temporum†) However, as a means to discuss how the world has suddenly witnessed the inception of modernist perspectives, Lewis explored the fusion between the Medieval and Renaissance movements that have brought about changes in the culture and aesthetic identities of society as a whole.Lewis said that although the force and influence of modernism was unnoticed by many, it may be felt or realized by contrasting society’s culture and aesthetic identities with the culture and aesthetic identities of the past. Lewis continues to reiterate that the changes and transformations that we see at present time were borne out of the continuous e volution of the past. Therefore, it was safe for Lewis to say that our culture and aesthetic identities at present time were a fusion between the Medieval and Renaissance movements that evolved and continually changed through the passage of time.As Lewis said, â€Å"nothing is quite new; it was always somehow anticipated or prepared for. † (â€Å"De Descriptione Temporum†) From Lewis’ discussions, we understand that between the periods of time as defined by the author, that is in a metaphorical sense â€Å"Between Jane Austen and us, but not between her and Shakespeare, Chaucer, Alfred, Virgil, or the Pharaohs, comes the birth of the machines.† (â€Å"De Descriptione Temporum†) I believe that beyond Lewis’ thoughts and perspectives on the matter, the persistent creativity and conscious and curious nature of human beings have progressively influenced the shift in the culture and aesthetic identity in the West. In Scott’s book â€Å"Re figuring Modernism: Postmodern Feminist Readings of Woolf, West, and Barnes,† the author’s definition of modernism was similar to Lewis’ discussions on how the continuous evolution of culture and aesthetic identities through the passage of time have been the precursor to modernism.According to Scott, the inception of modernism is similar to a spider web. â€Å"The spider’s actions of repeatedly attaching, launching out into the unknown, and landing for the next anchoring point suggests agency, poly valence, and the ability to make selective use of existing structures, or to seek new ones – not all of them man-made. † (Scott, pp. xv) What Scott meant was that growth and development is a natural part of life. Man is continually learning, which consequently influences the introduction of new theories and ideas that are integrated into man’s way of life and nature.Therefore, the changes in culture and aesthetic identities are brought about the desire of man to make something more out of art and his creativity. This same inclination of human nature to change and look to transform culture and aesthetic identities have been the same reason for the formation of different periods in time, from the Medieval to the Renaissance in the West, and so on. Lewis said, â€Å"our assumption that everything is provisional and soon to be superseded, that the attainment of goods we have never yet had, rather than the defence and conservation of those we have already, is the cardinal business of life.† (â€Å"De Descriptione Temporum†) The transformation of the Old Western Culture and aesthetic identities during that period of time to modernism, may then be defined as a fusion of man’s desire to reveal or express change that is meant to overpower the existing cultural, social, and political landscape of society during that time to develop a more progressive and vanguard culture and aesthetic identity that sets itse lf as a better society than the past.Works Cited Comentale, Edward P. & Gasiorek, Andrzej. T. E. Hulme and the Question of Modernism. Ashgate Publishing, Ltd. , 2006. Lewis, C. S. â€Å"De Descriptione Temporum, an Inaugural Lecture from The Chair of Mediaeval and Renaissance Literature in Cambridge University, 1954. † In C. S. Lewis, They Asked for a Paper. London, Geoffrey Bles, 1962, pp. 9-25. Retrieved from The University of Cincinnati. 06 May 2009. Scofield, Martin. T. S. Eliot: The Poems. Cambridge University Press, 1988. Scott, Bonnie Kim. Refiguring Modernism: Postmodern Feminist Readings of Woolf, West, and Barnes. Indiana University Press, 1995. Wellek, Rene. A History of Modern Criticism 1750-1950. CUP Archive, 1981. Woolf, Virginia. (2004). Modern Fiction. Retrieved from [email  protected] 06 May 2009.

Target, Positioning, and Marketing Mix at Bmw

Target, Positioning, and Marketing Mix at BMW BMW is one of the world’s largest luxury car companies and it is easy to understand why. Not only does this premium auto brand have a high resale value, but strong brand loyalty and an even bigger profit margin than mass-produced cars (Holloway, 2002). This in turn enables the premium maker to spend more on research and development into the minds of its target market to make better, more advanced cars with a powerful brand image. BMW is a German automobile, motorcycle and engine manufacturing company, which owns and produces the Mini brand, and is the parent company of Rolls-Royce Motor Cars. BMW is well known for its sporty, yet sophisticated image which has been built up since the 1970’s with many motor sports victories, and its BMW Group’s worldwide mission statement, â€Å"To be the most successful premium manufacturer in the industry† (http://www. bmwgroup. com). The majority of BMW’s success is attributed to the development of a consistent marketing policy, the ‘market niche’ strategy. The company has built is brand on four core values, which are technology, quality, performance, and exclusivity, whereas BMW has traditionally positioned its brand to be perceived as the leader in performance (Arnold, n. d. ). In fact, the BMW group and all BMW models are all about performance on the road and inside the plant in which they are manufactured. The fundamental core benefits for BMW customers are reliability, durability, and style. People who buy BMW are also paying for the engineering and quality, not for breakdowns (Arnold, n. d. . Buyers normally expect certain qualities in their cars when they purchase at BMW. Brand associations of German luxury brands like BMW include powerful, high-quality, fast, pricy, luxurious, classy, and sleek (Holloway, 2002). BMW owners usually purchase because they know they can rely on its solid background of high-quality vehicles, and superior performance, but they also know they are getting a vehicle that looks sporty, classy, and expensi ve at the same time. Technology plays a huge role in the difference between BMW and its competitors. BMW has combined its superior quality product with that of technology to enhance BMW service experience for its customers. In fact, research by Wanke, Bohner, and Jurkowitsch, (1997) suggest that BMW’s Augmented Reality has created the bridge and extends the real world by adding virtual information to assist BMW Service staff in their highly demanding technical work. Using augmented reality, a BMW mechanic receives additional three-dimensional information on the engine he/she is repairing. For example, augmented reality can be used to help in diagnosing and solving the fault in and engine (Horatiu, 2009). Apart from the real environment, technicians can see virtually animated components, the tools to be used and hear instruction on each of the working steps through headphones integrated inside the goggles (Horatiu, 2009). Next stands the exclusivity of BMW’s potential product and the ideas’ genesis come up with. BMW now makes cars using resources that would otherwise be wasted by putting them to good use. For instance, the Landfill Gas-to-Energy Project at BMW used to reduce its reliance on natural gas and better utilizes the previously untapped methane, which is a byproduct of decomposing trash and can have harmful effects on air quality. By turning this methane into energy, the plant has reduced carbon dioxide emissions equivalent to removing 61,000 automobiles from the U. S highways each year (Arnold, n. d. ). Today, 63 percent of the plant’s total energy is derived from landfill gas (Arnold, n. d. ). Not only that, this project has three core benefits, it reduces the amount of harmful greenhouse gases released into the air, allows BMW to use a wasted energy source by transforming the methane gas produced from the nearby Palmetto Landfill into electricity to heat for the plant, and it saves a lot of money for the company as a whole (Arnold, n. . ). BMW is now the first auto company in the world to use green energy to fuel its painting facility. Furthermore, since its inception, the project has been expanded to utilize landfill gas to fuel 23 oven burners in the paint shops at BMW and supply indirect heat to these areas (Arnold, n. d. ). In addition, marketers have classified BMW products as specialty goods be cause they have a unique characteristic or brand identification for which a sufficient number of buyers are willing to make a special purchasing effort (Kotler & Keller, 2009). Consumers who purchase BMW’s are willing to go to great lengths and travel afar to buy one. In fact, BMW is a product that stands above the rest requiring very little if any comparison to other brands as buyers already know exactly what they are looking for when in search of this particular type of vehicle (Holloway, 2002). Thus consumers that purchase BMW’s are investment buyers and often have upscale purchasing habits. And it is this reason that BMW, unlike many other marketers, has stopped emphasizing demographics such as targeting customers based on age and income, and tarted targeting based on mind-set and lifestyle. BMW marketers understand that their customers are concerned about status, and so this is what they focus their attention on. When advertising BMW marketers have focused on the specifics of the BWM and emphasis are often placed on the fact that BMW is continuously managing its cars performance quality through time, and research (Boudette, 2005). It cons istently strives to improve its products and for years has produced high returns and market shares for this very reason. Ideally, BMW’s positioning has been maintained over such a long period of time because the company possesses and develops an incredible competitive advantage. In terms of price, BMW’s mid-range vehicles start around $29,400 up to the most prestigious and luxurious vehicles priced around $130,000 (Boudette, 2005). Additionally, every new BMW is covered by a limited warranty for defects in materials or workmanship for the first four years or 50,000 miles, whichever comes first. BMW also offers a rust protection program for 2006 and newer models, which provides a 12-year limited rust perforation protection without mileage limitations (http://www. bmwgroup. com). Additional accessories and services offered by BMW include iDrive, Real Time Traffic Information, BMW Roadside Assistance, and BMW assist all the more reasons why consumers choose BMW. iDrive links BMW vehicles’ with communications, navigation and entertainment functions allowing owners to make calls, listen to music, plot routes and find places to stop along the way, with just one controller all at the same time. Real Time Traffic takes owners down shorter and faster routes, preventing them from getting stuck in traffic. It identifies traffic accidents and delays in real time and continuously updates the service 24 hours a day, 7 days a week, while smaller markets report only during normal commuting hours (http://www. bmwgroup. com). BMW Roadside Assistance is a feature most BMW owners find comforting because if they are traveling and get a flat, run out of gas, or need a tow BMW will send someone out immediately to assist no matter where the customer is located. BMW owners are covered in all 50 states, in Canada and Puerto Rico, even if someone else is driving the vehicle. These services are offered 24 hours, 365 days a year, at no additional cost, and without any mileage restrictions (http://www. bmwgroup. com). BMW assist, on the other hand, works as a sense of security, and is there for BMW customer’s safety. It is a convenient service that adds peace of mind for BMW owners, and is suitably equipped in 2007 and later models. BMW assist is part of the Ultimate Service at BMW, and is included at no additional cost for up to 4 years. This service connects owners to a response specialist that can help with almost everything, from an emergency situation to directions and traffic information by just a push of a button (http://www. bmwgroup. com). At BMW distribution is about the use of consistent standards of quality, safety, and processes at all locations. They guarantee worldwide premium products made by BMW Group as well as the careful use of resources being the guiding principle behind all production and planning. Its living structure is what enables it to react flexibly to customer demands and market requirements and conditions throughout the world (Ludwig, n. ). This is why they have such flexibility in models, as well as their ability to build additional numbers of certain models in other plants, if necessary. BMW gives its consumers exactly what they want building models with options customized to fit the individual consumer (Ludwig, n. d). As a result, the company’s dealerships keep very few cars on the lot. Instead, BMW offers intimate showrooms where customers can view cars and place orders with individual custom options that they select (Ludwig, n. d). After the car has been selected and the customer has chosen their individual custom features, BMW directs its manufacturing plant to produce the car and deliver it within a matter of days. Logistically speaking, when it comes to BMW and the channel of information, it means using CRM to strengthen communications with its dealers and make it as easy as possible for potential customers to get all the buyer information they need (Ludwig, n. d). BMW group also uses e-commerce strategies as a means to explore the market for effective business. The group introduced an ordering system in 1998 which gives dealers the option of showing customers their desired car on the screen and confirming the delivery date on the spot. Through the use of this system, the time frame when the vehicle can be built with the desired fitting is configured within a few seconds and is reserved in the production process immediately (Ludwig, n. d). Furthermore, the manufacturing logistics department at BMW has such outstanding internal processes to such a level that when changes accord due to customers’ wishes regarding issues as omplicated as engine capacity to something as small as the color of the upholstery it can be immediately communicated, and in most cases resolved prior to shipment of the vehicle. Moreover, the company has adopted a consistent advertising strategy. In addition to the message of its values being portrayed in advertising campaigns, the company explicitly expresses one or more of these values in all BMW advertisements (J ones, 2010). Its design philosophy also runs through every BMW advertisement communicated through TV and print ads. Its brand imaged has been built up by using over 300 different types of color press advertisements, as well as 64 different types of television commercials (Jones, 2010). BMW ads are always consistent and focus on the substance of the cars themselves. However, it is important to point out that BMW also relies on its sensitivity to the environment, which is clearly seen by how the company’s advertisements evolved in response to economic, environmental and competitive changes. In addition, since the competition started to imitate BMW’s adverting messages of outstanding quality, BMW decided to come up with a more unique way to reach its target audience. The company did so by hiring Fallon Worldwide, an advertisement agency, to come up with new campaigns. Now BMW uses guerilla public relations campaigning as a means to drive sales. Its diverse promotion tactics include seeding news of the BMW Films at key Internet entertainment rumor sites and radio DJ programs in 20 key metro markets, and BMW manufacturers use web mostly to drive its brand (Jones, 2010). In fact, BMW takes the phrase â€Å"beyond the banner† seriously. In its ads for the BMW Compact, the car drives out of the banner ad and around the sides of the browser window, to show how it loves corners. BMW’s online strategy in the UK is highly-brand drive, with clickthrough considered to be a side benefit (Jones, 2010). Not only that, BMW uses traditional banner ads, with pull-down menus, Superstitials, transitional ads which appear between pages, sponsorship and dynamic html ads like the one mentioned previously to promote its brand message and to drive the benefit of ownership in terms of the driving experience (Jones, 2010). Superstitials are highly interactive, non-banner ads that can be any size on the computer screen and up to 100k in file size. They can feature animation, sound graphics capable of effectively conveying integrated advertising messages while protecting its Web site’s performance (Jones, 2010). BMW utilizes this form of advertisement to achieve multiple goals, including branding, direct marketing, commerce and entertainment. In conclusion, as a worldwide organization, BMW Group has a long and established heritage of manufacturing premium products and holding true to its four core values of technology, quality, performance, and exclusivity. Today, BMW is one of the most respected companies and recognizable brands in the world. This is due to the fact that the BMW Group continues its leading position in the premium segments of the domestic and international automobile markets. The BMW Group has long pursued the objective of continuously and permanently increasing its company value and has done so by playing an active role in both shaping internal economic success factors as well as corporate citizenship in society as a means to gain and retain loyal customers. References Arnold, P. V. (n. d. ). BMW: The ultimate reliability machine. Retrieved March 2, 2011, from http://www. reliableplant. com/Read/5197/bmw-reliability Boudette, N. E. (2005). BMW’s Push to Broaden Line Hits Some Bumps in the Road. The Wall Street Journal. Retrieved March 3, 2011, from http://www. bimmerfest. com/forums/showthread. php? t=83762 Holloway, N. (2002). The best-driven brand. Forbes. com Inc. Retrieved March 01, 2011, from http://www. forbes. com/global/2002/0722/024. html Horatiu, B. (2009). BMW Augmented Reality. BMWBLOG News. Retrieved March 02, 2011, from http://www. bmwblog. com/2009/09/03/bmw-augmented-reality/ Jones, J. (2010). Driving Success Digitally. Response, 19(1) 30-35. Retrieved March 7, 2011, from EBSCOhost Direct database. Kotler, P. , & Keller, K. L. (2009). Marketing Management. Upper Saddle River, NJ:Prentice Hall. Ludwig, C. (n. d). Standing atop the Welt of BMW’s vehicle distribution. Automotive Logistics. Retrieved March 5, 2011, from EBSCOhost Direct database. Wanke, M. , Bohner, G. , & Jurkowitsch, A. (1997). There Are Many Reasons to Drive a BMW: Does Imagined Ease of Argument Generation Influence Attitudes? Journal of Consumer Research, 24(2) 170-177. Retrieved March 6, 2011, from EBSCOhost Direct database.

Black People and Roberta Essay

Determining the race of Twyla and Roberta from the clouded descriptions in Recitatif is a rather difficult task. The evidence in my opinion leads me to believe that Roberta is white and that Twyla is black. In this paper I will identify situations in this story that reinforce my opinion. I will also explain how minority group treatment influenced my perception of the events in this story. My early impression of Roberta was that of a spoiled country girl with little or no education that opinion was based on her inability to read and her waste of food at meal times. Finishing all your food is a strong force in many black families this waste can be construed as a connection to Roberta being white. The first verbal indication is Roberta’s mother’s refusal to greet Twyla’s mother Mary. This is a strong image of prejudice in my opinion. Roberta’s mother said nothing. She just grabbed Roberta and stepped out of line. Roberta’s mother’s disinterest in meeting a woman of the opposite race makes a convincing argument that she is white and in her mind better than associating with blacks. In the next scene the families were eating Lunch. Twyla made the observation that â€Å"The wrong food is always with the wrong people. † And the connection that â€Å"Maybe that’s why I got into waitress work later-to match up the right people with the right food. † There is a common stereotype that black people love chicken. So the white Roberta having the â€Å"black† chicken could be considered a Mitch match and since Roberta is white she should not have the chicken. The next piece of evidence comes much later when the two old friends are reunited in a supermarket. They have exchanged pleasantries and discussed how well there lives are going. It is obvious to the reader that Roberta is well off financially. Roberta makes the comment â€Å"I was dying to know what happened to her, how she got from Jimi Hendrix to Annandale, a neighborhood full of doctors and IBM executives. Easy, I thought. Everything is so easy for them. They think they own the world. † This statement shows that Twyla is aware of how easy it is for white people to raise their economic class. It can be implied that Roberta made the large advance because she was of the proper â€Å"white† race to make such advancement. The final piece of evidence is When Twyla confronts Roberta on her poor behavior at their encounter in Howard Johnson’s Roberta says â€Å"Oh, Twyla, you know how it was in those days: black-white. You know how everything was. † Roberta here identifies the strong pressure she felt from her peers to not associate with the â€Å"lower† black race. My first indication of Twyla’s race was the way her mother Mary introduced herself. She used the phrase â€Å"Twyyyyyla, baby! † the term â€Å"baby† is commonly associated with older black females. Mary’s reaction to Roberta’s mother’s refusal to shake hands coupled with the loud outbursts on the way to the chapel are also part of what society has deemed as black female behavior. Mary is described wearing â€Å"those ugly green slacks that made her behind stick out† There is a stereotype that black women have large behinds. These examples leads me believe Roberta’s mother is black and so the daughter must be of the same race. Throughout the story Roberta is always depicted in a lower class than Roberta always overshadowed by Roberta. Roberta marries into a higher social standing and has an implied superiority throughout the story. The statement â€Å"Everything is so easy for them. They think they own the world. † Is a common opinion about the social standing of whites in the United States. There are a lot of conflicting data to for both sides of this argument. In my opinion though there is much more evidence that leads the reader to believe that Roberta is white and Twyla is black.

Cyberspace Communication Essay Example | Topics and Well Written Essays - 500 words

Cyberspace Communication - Essay Example These metaphors acquire meaning because we are able to connect and associate even disparate things. For example we can say: 'he was turned off by the behaviour of his boss.' The title of George Orwell's famous book Down and Out in Paris is another good example of an orientational metaphor. We do not have words to describe everything. The first ray of the sun does not have a word and the first kiss of the lover is still just a kiss. These lapses of language create dents in the perception of reality. Personifying metaphors are used to lend spectacle as well as intensity to an act of communication. Abstract entities can be conceived metaphorically in terms of human life and expressed as capable of living and growing. 'Life' of a government, lifeblood, 'economic' growth are good examples. When one says that qualities reside in someone or something lives in memory, the human tendency to equate the inequitable is brought to the fore. When someone gives me the ghost of a smile, I am compelled to marvel at how the brain googles and establishes links. The word 'etheral' could be a good substitute since it combines 'ether' and 'all'. It is relevant because it makes one remember the aspect of the Universe - that vast domain which we all inhabit and our email address is a strong reminder of where we actually belong. After all, where is this gmail.com John Seely Brown

Disability in South Africa is viewed as a medical problem Critically Essay

Disability in South Africa is viewed as a medical problem Critically analyse this statement - Essay Example South Africa can be considered as one of the fastest growing economies around the globe. This country can be considered as one of the leading emerging nations in this world. The people of South Africa are getting basic necessities ensured by the government of the country. But, still the country is suffering from growing disability index. It has become a serious problem. South Africa is the largest economy with positive social growth rate among all the African nations. But, the country is suffering from these types of health and welfare related issues. In maximum cases, it has been identified that medical issues are responsible for disability in human beings. It is true that government of South Africa has developed several non-profit organizations in order to overcome these issues. But, lack of integrity and awareness programmes affected the campaign. Most importantly, it has become a medical problem of the country. This essay will critically discuss and analyze this issue. The disability in South Africa is supposed to be bounded and bordered by prejudice and stigma. The disability issues within welfare and health structure led to a failure of incorporating disability into conventional statistical process of government. In the year 1996, Census stated that elder people have high rate of disability with over 50 percentages in compare to 1.5 percentages of children. This is primarily due to the fact that respondents lack effective studies to detect occurrence of disability issues within children. The efficiency of healthcare system and effectiveness of political, social and economic conditions can influence the rate of people with disabilities. The lack of effective healthcare system has been prime cause for high rate of disability in South Africa. Under the backing of financial and community services in independent and Bantustans states, severe was

Fate or destiny is it possible to control that which we have no Essay

Fate or destiny is it possible to control that which we have no control of - Essay Example For instance, death and birth are unavoidable. Similarly, there are several other occurrences in life that seem inevitable. Destiny plays an important role in our daily lives. Each and every event in our lives is governed by our destiny. With regards to destiny, we are truly in control of ourselves and we are responsible for our decisions. However, there are some things that are beyond our control, this is what can be regarded as fate. In the larger scheme of things, we feel free as we are human being are able do what they want. If we make the correct decisions in life and act accordingly, no one will prevent us from achieving what we really want. The cultural, divine and psychological forces that can be a hindrance to a person’s destiny but if he or she remains focused he will be able to control his fate. Men struggle and work to attain specific ends, but later realize that there is a power that is beyond their control, which frustrates their efforts. As men age, they accept the power of destiny and its effect on the world around them. Great men such as philosophers and poets also submitted to this power and witnessed as it seemed to favor the favorites and strike its victims. This essay will explore the story by William Faulkner â€Å"Barn Burning† and â€Å"The Rime of the Ancient Mariner† by Samuel Coleridge to show that a person is able to control his destiny but has no control over his fate. This power of destiny is represented by the greatest poets including William Faulkner in his work, â€Å"Barn Burning†. Most dramatists often depict heroes as knowledgeable of their destiny and attempting to escape from it. However, by trying to escape from their destiny, a series of consequences result. The consequences bring about their some challenges. Therefore, poets assert that a man cannot avert his or her destiny, whether he knows the destiny or not. Every unconscious or conscious act of the man is one step towards his or her destin y. In the â€Å"Barn Burning†, Abner, is said to â€Å"have an old habit which he had not been permitted to choose for himself† (Faulkner 56). Therefore, this argument can show that a person is not able to change his destiny regardless of the challenges he faces. This clearly shows that the boy has control over his destiny but does not have any control over his fate. It seems there was a supernatural power that dictated his behavior or habit. It is thus impossible for Abner or any other person to control his fate but he has control over his destiny. The forces of fate are also presented in â€Å"The Rime of the Ancient Mariner† by Samuel Coleridge show that there are things beyond our control. For example, the poem talks of death as an incident that is beyond man’s control. It is impossible for an individual to have knowledge of when or how they are going to die. Also, once death is to occur, no one can stop it. The reverse is also true in that, if one is not destined to die, then no one can cause the ultimate death of that person. In part IV of the poem, the persona says â€Å"alone, alone, all, all alone†¦the many men, so beautiful, and they all dead did lie† (Coleridge 89). This point clearly shows that death is fate and no human individual is able to control it. However, if one is able to avoid death through living a good free from any dangers you will live much longer. The author was destined

Leukemia Research Paper Example | Topics and Well Written Essays - 1250 words

Leukemia - Research Paper Example Different types of blood cells have their own respective tasks. Different types of the white blood cells serve the purpose of fighting infection whereas the red blood cells are the fundamental source of oxygen to all tissues in the body. Platelets are another kind of blood cells that help control bleeding by forming blood clots. Stem cells form all three kinds of blood cells as per the requirement of body. Older cells get damaged with time and expire to make room for new cells. Bone marrow in the bones of an individual who suffers from leukemia produces abnormal white blood cells which are termed as the leukemia cells. Leukemia cells continue to live far beyond the time that normal blood cells expire. As a result of that, they grow larger in number as compared to the usual white blood cells, platelets and the red blood cells which does not allow the normal blood cells to function as they normally do. Types of Leukemia: Leukemia can be classified into different types depending upon th e speed of development of the disease and its aggravation. There are two basic types of leukemia, namely the chronic leukemia and the acute leukemia. Chronic leukemia is the type of leukemia that takes some time to get worse whereas the acute leukemia is that sort of leukemia that worsens quite quickly. 1. Chronic Leukemia: When the disease is in the initial stages, leukemia cells are able to do considerable amount of work of the normal white blood cells. As a result of this, the victims of disease may not discover any symptoms in the start. In a vast majority of cases, chronic leukemia gets diagnosed by the doctor in a routine checkup without the indication of any symptoms. As some time passes, leukemia gets worse. This happens as the blood contains an increased number of leukemia cells. This is the time when symptoms start to show up. The patient develops infections or swollen lymph nodes. These symptoms are mild in the start and with time, get worse. 2. Acute Leukemia: Acute leuk emia cells are not able to function as the normal white blood cells. In this type of disease, the leukemia cells quickly increase in number. Accordingly, the acute leukemia rapidly aggravates. Prognosis of Leukemia: A disease’s prognosis is an overview of its development and life expectancy. This is estimated considering the historic medical data. Prognosis for the different kinds of leukemia is discussed below: 1. Prognosis for chronic leukemia: Symptoms of chronic leukemia take quite some time to show up. In the initial stages of the disease, the patient may experience night sweats, swollen spleen, fatigue, and lack of energy (Pilgrim). More middle aged adults are affected by this kind of leukemia as compared to children. Prognosis of chronic leukemia depends upon the level of aggravation of the disease. Bone marrow transplant and chemotherapy are commonly employed as the methods of treatment for the chronic leukemia. In the early stages of the disease, patients can expect to live for 98 months. Patients who have been suffering from this disease for quite some time should expect a life of 65 months more, whereas the ones who are in the last stage of the disease can expect a life of 42 months (Pilgrim). 2. Prognosis of acute leukemia: Acute leukemia is a more severe type of leukemia because the disease aggravates faster. This type of leukemia commonly occurs in adults. 20 to 40 per cent of the patients of acute leukemia continue to live up to a minimum of 60 months if the disease gets

Andy Warhol - Ambulance Disaster Essay Example | Topics and Well Written Essays - 2250 words

Andy Warhol - Ambulance Disaster - Essay Example The essay "Andy Warhol - Ambulance Disaster" states the artwork of Andy Warhol called "Ambulance Disaster". Andrew Warhola, the birth name of Andy Warhol was born in Forest City, outside Pittsburgh, Pennsylvania in the family of Slovakia immigrants in August 6, 1928. After graduation from the Carnegie Institute of Technology where he studies pictorial design he moved to New York to work as a commercial artist for several magazines including Vogue, Harper's Bazaar and the New Yorker. He was also involved in advertising and arranging window displays for Bonwit Teller and I. Miller. That’s where he developed his unique sense of style. By 1959 Warhol was a successful advertising design professional. His numerous medals and rewards suggest of his professional career. He won several commendations from the Art Director's Club and the American Institute of Graphic Arts. Already in 1952 his first individual show at the Hugo Gallery, exhibiting Fifteen Drawings Based on the Writings of Truman Capote was launched. He had his first group show at the Museum of Modern Art in 1956. From the early start of professional career Andy Warhol produced images of male nudity in standard "artistic" poses as well as shocking sketches of masturbating men and depiction of same sex intercourse. His sketching and photographing male bodies supported his ability to maintain innovative and influential career. Still he attempted to gain recognition as a "fine" artist featuring â€Å"cupids, beautiful boys' faces.

Effects of Media Globalization on Arab Culture Essay

Effects of Media Globalization on Arab Culture - Essay Example If the information technology and media dimensions are prohibited from entering into their closed territories, the countries lag behind and no country can afford to do that. Also all countries are anxious to take advantage of the benefits of globalisation, open their culture and attractions to tourism industry, so that they could be financially benefited. Environment is another matter that belongs to all the countries of the world and no country could afford to stay out of this issue. Arab countries are also keen on opening up the economy to venture into highly profitable imports and exports without which they will remain backward, while others are moving relentlessly forward. At the same time, most countries with closed cultures do not like their people to watch, learn and get influenced by other cultures. Some countries and cultures have an unfortunate view that only their culture is the best and all other cultures are unholy. Even for them it is important to take advantage of the technological improvements and discoveries from the 'unholy' cultures. Hence, the dilemma continues and even such countries cannot choose to lag behind by closing their doors to globalisation and information technology and rightly so. It is important to know all the diverse views about globalisation, media explosion and communication on the rather cosseted world of Arab culture. There are many views and most of them are against the globalisation. This does not mean that they do not want the benefits of globalisation. They only need the culture to be maintained as it had been done all these centuries. It is significant to find out how they could do it, and how effective they are in their goal. Also it is important to know how the global consumerism is catching up in the Islamic world of Arab countries. It is pertinent to peep into the women mentality and their freedom and if there had been any effect in that field at all. Finally it is necessary to know how Lebanon is fairing under globalisation and media explosion because Lebanon is in a unique position as it is caught in the political upheaval for a long time, a struggle for supremacy with Israel, a difficult problem of maintaining and working with Hezbollah, an d at the same time, trying to contain the terrorist and militant fractions of the society. LITERATURE REVIEW There is definitely broad diversity of opinions about the profit and loss of the effect of the internationalisation of non-tradition media under globalisation. In a way, Arab countries including Lebanon are trying to find political and economic solutions while trying to keep the social dimensions unchanged and this might become quite a challenging task eventually. Like any other country in the world, Arab countries too are living in a rapidly changing world and absolutely emotional attachment to the origins might become difficult and to some extent, a hindrance. There are opinions that globalisation in a way helped the Arab world to unite further. "I refer, above all, to the advanced communications technology which has functioned, on the one hand, to transfer the forces of globalization to the rest of the world and, on the other, to strengthen the bonds of language, culture, customs and tradition between Arab Americans and their original homelands" says Nasser in http://www.alhewar.c om/HGANasser.htm In the same speech Dr. Nasser goes on

“On Being Sane in Insane Places” Essay Example for Free

â€Å"On Being Sane in Insane Places† Essay It was very interesting to read about Rosenhans study and how psychiatrists, who go through big coursework and training, could wrongly classify a patient. It surprised me how some psychiatrists couldn’t say they don’t know what’s wrong with patients instead they could possibly diagnose someone as insane. Though reading this chapter I found the strange things from Rosenhan’s study that was hard to believe. Slater states, â€Å"The strange thing was, the other patients seemed to know Rosenhan was normal, even while the doctors did not. † (69). I believe patients can know that better than doctors because they are in that situation already and some doctors don’t analyze their patients carefully to know what’s actually happening with them. For example, if someone studies about one culture doesn’t mean that person knows way better that person who actually lives with that culture. Both chapters I found interesting because it relates to my life very well. I found out Elliot Aronson, Darley and Latane all kind of try to show that people needs to find reason for their actions. I believe each person as a human have to help everyone no matter what. Darley and Latane’s mention is about how to help someone in an emergency that relates with Catherine Genovse murder. Slater says, â€Å"You must interpret the event as one in which help is needed† (95). We read about Catherine’s murder and saw that after she had asked for help, someone yelled, leave that girl alone, instead of helping, and the only thing that happened was that the killer ran away (95). I agree with Darley and Latane’s that we need to know which help is needed and what help is not. The person may have helped with getting the killer away, but Catherine needed the help the most, so she wouldn’t die. I been in so many situations that someone needed my help and I helped as much as I could, but knowing what helped was needed help me a lot. Leon Festinger talked about how people really pay attention to what is going on in their life and around them. I think some people just pay attention to what they want. Its true most of the people like to listen to people who agree with them and ignore who doesn’t. The chapter also discussed how people can believe in something they can’t prove such as God working through  a person. I think even for believing a god it has many prove to make a person to believe it. I believe for believing on something need to have something as prove. This section is a really great one however I didnt prefer how the experiments were described. I additionally didnt prefer the experiments and there result. Harlow was a fascinating man and I preferred how the author discusses the experimenter and how they grew up on the grounds that it permits me to understand their conclusions about their examinations and why they are imperative to them. I thought it was interesting that the monkeys adored the cover yet when they were displayed a face they might be scared and yell or cry about it. What I establish fascinating was that when they were babies they existed like a typical life however when they got older they went insane. A percentage of the monkeys were introducing a mental imbalance, gnawing them, and one of the monkeys bit off his hands. This discovering was entertaining since Harlow was supporting the surrogate moms and this wound up going terrible for him. I wish the author might stick more to the investigations and less to her editorializing. I cant agree with what Zola-Morgan does say â€Å"our human lives are intrinsically more valuable; monkey studies yield information that helps those lives† (153). Of course humans are more valuable than the monkeys, but still monkeys are animals and I think it’s so cruel to hurts them only because to do the experiment. If that kind of research saved the life of loved then I will be okay with that. I still feel awful with doing that type of experiment on poor animals that didn’t do nothing wrong.   This is another important finding because it just shows that psychiatrists may not have any idea about what they are doing, but no one questions them because of their authority. Of course after whom goes through big coursework and training, don’t expect someone to tell them they are wrong but from Rosenhan’s study they may be wrong too.

Impacts on Agency Cost Theory

Impacts on Agency Cost Theory The main purpose of this research is to investigate how the determinants of the capital structure (leverage) and the dividend payout policy impact the agency cost theory. Literature review part picked up the relevant material related to agency theory, leverage, and dividends payout policy. The literature review section goes through the agency cost literature, and explores the financial policies; the capital structure (leverage), and the dividend payout policy and that these policies would influence the agency cost theory. 2.1 Agency theory Literature The notion of the agency theory is widely used in economics, finance, marketing, legal, and social sciences; Jensen and Meckling (1976) initiated and developed it. Capital structure (leverage) for the firms is determined by agency costs, i.e., costs related to conflict of interests between various groups including managers, which have claims on the firm’s resources (Harris and Raviv, 1991). Jensen and Meckling (1976) defined the agency relationship as â€Å"a contract under which one or more persons (the principal) engage another person (the agent), to perform some service on their behalf which involves delegating some decision making authority to the agent† pp.308. Assuming that both parties utility maximizes, the agents are not possible to act in the best interest of the principal. Furthermore, Jensen and Meckling (1976) contended that the principal can limit divergences from his interest by establishing appropriate incentives for the agent, and by incurring monitoring costs (pecuniary and non pecuniary), which are designed to limit the aberrant activities of the agent. Jensen and Meckling (1976) argued that the agency costs are unavoidable, since the agency costs are borne entirely by the owner. Jensen and Meckling (1976) contended that the owner is motivated to see these costs minimized. Authors who initiated and developed the agency theory have argued that if the owner manages a wholly owned firm, then he can make operating decisions that maximise his utility. The agency costs are generated if the owner manager sells equity claims on the firms, which are identical to his.  It also generated by the divergence between his interest and those of the outside shareholders, since he then bears only a fraction of the costs of any non-pecuniary benefits he takes out maximizing his own utility (Jensen and Meckling, 1976). Jensen and Meckling (1976) suggested two types of conflicts in the firm; First of all, the conflict between shareholders and managers arises because managers hold less than a hundred percent of the residual claim. Therefore, they do not capture the entire gain from their profit enhancement activities, but they do bear the entire cost of these activities. For example, managers can invest less effort in managing firm resources and may be able to transfer firm resources to their own, personal benefit, i.e., by consuming â€Å"perquisites† such as a fringe benefits. The manager bears the entire cost of refraining from these activities but captures only a fraction of the gain. As a result, managers over indulge in these interests relative to the level that would maximize the firm value. This inefficiency reduced the large fraction of the equity owned by the manager. Holding constant the manager’s absolute investment in the firm, increases in the fraction of the firm financed by debt increases the manager’s share of the equity and mitigates the loss from conflict between the managers and shareholders. Furthermore, as pointed out by Jensen (1986), since debt commits the firm to pay out cash, it reduces the amount of free cash flow available to managers to engage in these types of interests.  As a result, this reduction of the conflict between managers and shareholders will constitute the benefit of debt financing. Second, they also suggested that the conflict between debt holders and shareholders arises because the debt contract, gives shareholders an incentive to invest sub optimally. Especially when the debt contract provides that, if an investment yields large returns, well above the face value of the debt, shareholders capture most of the gain. However, if the investment fails, debt holders bear the consequences. Therefore, shareholders may benefit from investing in very risky projects, even if they are under valued; such investments result in an adverse in the value of debt. Lasfer (1995) argued that debt exacerbates the conflict between debt holders and shareholders. Shareholders will benefit from investments in risky projects at the expense of debt holders.  If the investment yields higher return than the face value of debt, shareholders capture most of the gain, however, if the investment fails, debt holders lose, given that. Therefore, shareholders protected by the limited liability. On the other hand, if the benefits captured by debt holders reduce the returns to shareholders, then an incentive to reject positive net present projects has created. Thus, the debt contract gives shareholders incentives to invest sub optimally. In addition, Myers (1977) argued that the firms with many growth opportunities should not be financed by debt, to reduce the negative net value projects.   Furthermore, some of arguments have been debated that the magnitude of the agency costs varies among firms. It will depend on the tastes of managers, the ease with which they can exercise their own preferences as opposed to value maximization in decision making, and the costs of monitoring and bonding activities. Therefore, the agency costs depend upon the cost of measuring the manager’s performance and evaluating it (Jensen and Meckling, 1976). (Jensen, 1986) either points out that when firms make their financing decision, they evaluate the advantages that may arise from the resolution of the conflicts between managers, shareholders and from long run tax shields.   In addition, Lasfer (1995) argues that debt finance creates a motivation for managers to work harder and make better investment decisions. On the other hand, debt works as a disciplining tool, because default allows creditors the option to force the firm into liquidation. Debt also generates information that can be used by investors to evaluate major operating decisions including liquidation (Harris and Raviv, 1990). Jensen (1986) debated that when using debt without retention of the proceeds of the issue, bonds the managers to meet their promise to pay future cash flows to the debt holders. Thus, debt can be an effective substitute for dividends. By issuing debt in exchange for stock, managers are bonding their promise to pay out future cash flows in a way that cannot be accomplished by simple dividend increases. Consequently, managers give recipients of the debt the right to take the firm to the bankruptcy court if they do not maintain their commitment to make the interest and principle payments. Thus, debt reduces the agency costs of free cash flow by reducing the cash flow available for spending at the discretion of managers. Jensen (1986) claimed that these control effects of debt are a potential determinant of capital structure. In practice, it is possible to reduce the owner manager non pecuniary benefits; by using these instruments external auditing, formal control systems, budget restrictions, and the establishment of incentive compensation systems serve to identify the manager’s interests more closely with those of the outside shareholders (Jensen and Meckling, 1976). Jensen (1986) suggested that leverage and dividend may act as a substitute mechanism to reduce the agency costs. Agency cost models predict that dividend payments can reduce the problems related to information asymmetry. Dividend payments might be consider also as a mechanism to reduce cash flow under management control, and help to mitigate the agency problems (Rozeff, 1982, and Easterbrook, 1984). Therefore, paying dividends may have a positive impact on the firms value. â€Å"Agency theory posits that the dividend mechanism provides an incentive for managers to reduce the costs related to the principal agent relationship, one way to reduce agency costs is to increase dividends† Baker and Powell (1999). They also claim that firm use the dividends use as a tool to monitor the management performance. Moreover, Easterbrook (1984) and Jensen (1986) argue that agency costs exist in firms because managers may not always want to maximize shareholder’s wealth due to the separation of ownership and control. Jensen (1986) addresses the free cash flow theory, in terms of this theory the conflict of interest between managers and stockholders is rooted in the presence of informational and self interest behavior. He defines the free cash flow as â€Å"cash flow in excess of that required to fund all projects that have positive net present value when discounted at the relevant cost of capital† (Jensen,1986). Within the context of the free cash flow hypothesis, firms prefer to increase their dividends and distribute the excess free cash flow in order to reduce agency costs. Consequently, markets react positively to this type of information. This theory is attractive because it is consistent with the evidence about investment and financing decisions (Jensen, 1986, Frankfurter and Wood, 2002). 2.2 Leverage Literature This section reviews the determinants of capital structure by different relevant literatures. Titman and Wessels (1988) study is considered to be one of the leading studies in the developed markets. They tried to extend the empirical work in capital structure theory by examining a much broader set of capital structure theories, and to analyze measures of short term, long term, and convertible debt. The data covers the US industrial companies from 1974 to 1982, and they used a factor analytic approach for estimating the impact of unobservable attributes on the choice of corporate debt ratios. As a result, the study confirms these factors, collateral values of assets, non-debt tax shields, growth, and uniqueness of the business, industry classification, firm size, and firm profitability. They also found that there is a negative relationship between debt levels and the uniqueness of the business. In addition, short term debt ratios have a negative relationship to firm size. However, they do not provide support for the effect on debt ratios arising from non debt tax shields, volatility, collateral value of assets, and growth. In Jordan, Al-Khouri and Hmedat (1992) aimed to find the effect of the earnings variability on capital structure of Jordanian corporations from the period from 1980 to 1988. They included 65 firms. The study used a multivariate regression approach with financial leverage as the dependent variable measured in three ways; first, long term debt over total assets, secondly, short term debt over total assets, and finally, short term debt plus long term debt over total assets. The standard deviation of the earnings variability and the size of the firm measured as independent variables. They concluded that the firm size is considered as a significant factor in determining the capital structure of the firm, and insignificant relationship between the earning variability and financial leverage of the firm. Furthermore, they suggest that the type of industry is not considered as a significant factor in determining the capital structure of the firm. Rajan and Zingales (1995) provided international evidence about the determinants of capital structure. They examined the capital structure in other countries related to factors similar to those that influence United States firms. The database contains 2583 companies in the G7 countries. They used regression analysis with the firm’s leverage (total debt divided by total debt plus total equity) as the dependent variable. Tangible assets, market to book ratio, firm size, and firm profitability used as independent variables. They found that in market bases firms with a lot of fixed assets are not highly levered, however, they supported that a positive relationship exists between tangible assets, and firms size, and capital structure (leverage). On the contrary, they confirmed that there is a negative relationship between leverage and the market to book ratio, and profitability. From the capital structure literature, Ozkan (2001) also investigated that the determinants of the target capital structure of firms and the role of the adjustment process in the UK using a sample of 390 firms. The multiple regression approach (panel data) was used to measure the debts by total debt to total assets, on the one hand. He also used in his model, non debt tax shield, firm size, liquidity, firm profitability, and firm growth as an independent variables. He confirmed that the profit, liquidity, non debt tax shield, and growth opportunities have a negative relationship to capital structure (leverage). Finally, he supported that there is a positive effect arising from size of firms on leverage. The study provided evidence that the UK firms have long term target leverage ratios and that they adjust quickly to their target ratios. The study by Booth et al. (2001) is considered as a one of the leading studies in the developing countries. It aimed to assess whether capital structure theory is applicable across developing countries with different institutional structures. The data include balance sheets and income statements for the largest companies in each selected country from the year 1980 to 1990. It included 10 developing countries: India, Pakistan, Thailand, Malaysia, Zimbabwe, Mexico, Brazil, Turkey, Jordan, and Korea. The study used multivariate regression analysis with dependent variables; total debt ratio, long term book debt ratio, and long term market to debt ratio. The independent variables are; average tax rate, tangibility, business risk, firm size, firm profitability, and market to book ratio. Booth et al. found that the more profitable the firm the lower the debt ratio, regardless how the debt ratio is defined. In addition, the higher the tangible assets mix, the higher is the long term debt ratio but the smaller is the total debt ratio. Finally, it concluded that debt ratios in developing countries seem to be affected in the same way by the same set of variables that are significant in developed countries. Voulgaris et al. (2004) investigated the determinants of capital structure for Greek manufacturing firms. The study used panel data of two random samples one for small and medium sized enterprises (SMEs) including 143 firms and another for large sized enterprises (LSEs) including 75 firms for the period from 1988 to 1996. It used a leverage model as a dependent variable (short run debt ratio, long run debt ratio, and total debt ratio). On the other hand, It used firm size, asset structure, profitability, growth rate, stock level, and receivables as independent variables. The study suggested that there are similarities and differences in the determinants of capital structure among the two samples. The similarities include that the firm size and growth opportunities positively related to leverage. While, they confirm that the profitability has a negative relationship to leverage. Moreover, they pointed out the differences that the inventory period, and account receivables collection period have been found as determinants of debt in SMEs but not in LSEs. Liquidity doest not affect LSEs leverage, but it affects the SMEs. Finally, they also suggested that there is a positive relationship between profit margins and short term debt ratio only for SMEs. Voulgaris et al. (2004) have debated this arguments as; ‘‘the attitude of banks toward small sized firms should be changed so they provide easier access to long-term debt financing’’. In addition, â€Å"enactment of rules that will allow transparency of operations in the Greek stock market and a healthier development of the newly established capital market for SMEs will assist Greek firms into achieving a stronger capital structure’’. 2.3 Dividends payout ratio literature Dividend payout ratios vary between firms and the dividend payout policy will impact the agency cost theory. Rozeff (1982) investigated in his study that the dividends policy will be rationalize by appealing the transaction cost and agency cost associated with external finance. Moreover, Rozeff (1982) had found evidences supporting how the agency costs influence the dividends payout ratio. He found that the firms have distributed lower dividend payout ratios when they have a higher revenue growth, because this growth leads to higher investment expenditures.  This evidence supports the view of the investment policy affect on the dividend policy; the reason for that influences is that would the external finance be costly. Conversely, he found that the firms have distributed higher dividends payouts when insiders hold a lower portion of the equity and (or) a greater numbers of shareholders own the outside equity. Rozeff (1982) pointed out that this evidence supports that the dividend payments are part of the firm’s optimum monitoring and that bonding package reduces the agency costs. Moreover, if the agency cost declines when the dividend payout does and if the transaction cost of external finance increases when the dividend payout is increased as well, then minimization of these costs will lead to a unique optimum for a given firm. In addition, Hansen, Kumar, and Shome [HKS], (1994) pointed out the relevance of the monitoring theory for explaining the dividends policy of regulated electric utilities. From an agency cost perspective, they emphasized their ideas that the dividends promote monitoring of what they call the shareholders regulator conflict. Therefore, it is a monitoring role of dividends. On the contrary, Easterbrook’s (1984) has noted that the dividends monitoring of the shareholders managers conflict. They also have observed that the utilities firms have a discipline of monitoring mechanism for controlling agency cost, depending on the relative cost effectiveness of those costs (Crutchly and Hensen, 1989). The regulator process will impact the conflict between the shareholders and mangers, by mitigate the managers’ power to appropriate shareholders’ wealth and consume perquisites (Hansen et al. 1994). On the other hand, they argued this issue by the cost-plus concept, regulators may set into motion of managerial incentive structure that potentially conflicts with shareholders interests, this concept solve the shareholders-regulators concept since the sources of the conflict lies in differences in the perceptions of what constitutes fair cost plus. Therefore, the regulation can control some of the agency cost while exacerbating others. In their study, they conduct also that the managers and shareholders of unregulated firms have a several mechanisms whether, internal or external, for controlling agency cost. In addition, they observed that the dividend policy to reduce the agency theory is not limited, depending on their findings they suggested that the cost of dividend payout policy might be below the costs paid by other types of firm. In fact the utilities company maintain high debt ratio that would maintain as well as equity agency costs. Aivazian et al. (2003b) compare the dividend policy behaviour of eight emerging markets with dividend policies in the US firms in the period from 1980 to 1990. The sample included firms from; Korea, Malaysia, Zimbabwe, India, Thailand, Turkey, Pakistan, and Jordan. They found that it is difficult to predict dividend changes for such emerging markets. This is because the quality of firms with reputations for cutting dividends is somehow similar to those who increase their dividends, than for the US control sample. In addition, current dividends are less sensitive to past dividends than for the US sample of firms. They also found that the Lintner model[1] does not work well for the sample of emerging markets. These results indicate that the institutional frameworks in these emerging markets make dividend policy a weak technique for signaling future earnings and reducing agency costs than for the US sample of firms. Furthermore, Omran and Pointon (2004) investigated the role of dividend policy in determining share prices, the determinants of payout ratios, and the factors that affect the stability of dividends for a sample of 94 Egyptian firms. They found that retentions are more important than dividends in firms with actively traded shares, but that accounting book value is more important than dividends and earnings for non-actively traded firms. However, when they combined both the actively traded and non-traded firms, they found that dividends are more important than earnings. In the determinants of payout ratios, they found that there is a negative relationship between the leverage ratio and market to book ratio, tangibility, and firm size on the one hand, to the payout ratios in actively traded firms. On the contrary, they also found that there is a positive relationship between the business risk, market to book and firm size (measured by total assets) to payout ratios in non-actively traded firms. Furthermore, for the whole sample, leverage has a positive relationship with payout ratios, while firm size (measured by market capitalization) is negatively related to payout ratios. Finally, the stepwise logistic regression analysis shows that decreasing dividends is associated with lack of liquidity and overall profitability. In addition, increasing dividends is associated with higher overall profitability. 2.4 Summary In this chapter the relevant literatures addressing the reviews of the agency cost theory related to the financial policies. It also gives a theoretical background on how the conflicts of interests arise between the agents (managers) and the principal (shareholders). The second and third sections present the determinants of leverage and dividend payout policy. The following chapter will go through the description of data, and data methodology was employed for this dissertation. 3. Methodology, Research Design and Data Description The aim of the current study is to investigate firstly, the empirical evidence of the determinants of leverage and dividend policy under the agency theory concept for the period 2002-2007. The majority of the previous studies in the field of capital structure have made in the context of developed countries such as USA and UK. It is important to investigate the main determinants of leverage and dividend policy in developing countries where, capital markets, are less developed, less competitive and suffering from the lack of compatible regulations and sufficient supervision This chapter will explain the research methodology of this study. This chapter also identifies the sample of the study. Moreover, it presents an illustration of the econometric techniques that have been employed. In addition, this chapter gives a brief explanation of the specification tests used in the study to identify which technique is the best for the data set. This chapter structured as follows; Section (3.1) presents data description.  Section (3.2) presents the sample of the study. Section (3.3) discusses the econometric techniques employed in the study. Finally, Section (3.4) provides a brief summary. 3.1 Data Description The data used in the study are secondary data for companies listed at Amman Stock Exchange (ASE) for the period of 2002-2007. The data was extracted from the firm’s annual reports, and from Amman Stock Exchange’s publications (The Yearly Companies Guide, and Amman Stock Exchange Monthly Statistical Bulletins). Data is readily available in the form of CD and on the website of the Amman Stock Exchange. The reason for the study period selection was to minimize the missing observations for the sample companies. Moreover, a different reporting system has been used since 2000. The application of the new reporting system was the result of the transparency act which was launched in 1999, and forced all companies listed in Amman Stock Exchange to disclose their financial information and publish their annual reports according to the International Financial Reporting Standards. In other words, this data series for the period from 2002-2007 was chosen in terms of consistency and comparability purposes. 3.2 Sample of the study The sample of the study consists of the Jordanian Manufacturing companies listed on the Amman Stock Exchange for the period of 2002-2007. The total number of the companies listed in ASE at the end of year 2007 was 215. Officially, these companies are divided into four main economic sectors; Banks sector, Insurance sector, Services sector and finally Industrial sector. Moreover, this study is concerned only with Jordanian manufacturing companies that their stocks are traded in the organized market. It is important to note that the capital structure of financial firms has special characteristic when compared to the capital structure of non financial firms, they also have special tax treatment (Lester, 1995). On the other hand, the financial firms have a higher leverage rate, which may tend to make the analysis results biased. Moreover, financial firms their leverage is affected by investor insurance schemes (Rajan and Zingals, 1995). For these reasons, the potential sample of the study consists of non financial (Manufacturing) companies that are still listed in Amman Stock Exchange. The total number of industrial companies listed in ASE at the end of year 2007 was 88 companies, which are 40.93% of the total number of the companies listed in that market. The study conducts the following criteria in selecting the sample upon the Jordanian manufacturing companies by excluding all the firms that was incorporated after year 2002, and all the firms that have merged or acquired during this period, further, the firms have liquidated or delisted by the Amman Stock Exchange, and finally, the study have also excluded the firms that have information missing for that period. The application for those criteria has resulted in 52 samples of manufacturing companies. The data for the variables that are included in the study models is tested using three different econometric techniques which will be discuss briefly in the next sections. 3.3 Econometrics techniques Hairs et al. (1998) argued that the application of econometrics technique depends on the nature of data employed in the study, and to what extent it would be realised to the research objectives. In order to find a best and adequate data model, the current study employs pooled data technique and panel data analysis which is usually estimated by either fixed effect technique or random effects technique.  The following sections provide a brief discussion on the econometrics techniques that the current study uses to estimate the empirical models. 3.3.1 Pooled Ordinary Least Square (OLS) technique All the models used in the study have been tested by the pooled data analysis technique. The pooled data is the data that contains pooling of time series and cross-sectional observations (combination of time series and cross-section data) (Gujarati, 2003). The pooled data analysis has many advantages over the pure time series or pure cross sectional data. It generates more informative data, more variability, less collinearity among variables, more degrees of freedom, and more efficiency (Gujarati, 2003). The underlying assumption behind the pooled analysis is that, the intercept value and the coefficients of all the explanatory variables are the same for all the firms, as well as they are constant over time (no specific time or individual aspects). It also assumes that the error term captures the differences between the firms (across-sectional units) over the time. However, (Gujarati, 2003) has pointed out that these assumptions are highly restrictive. He argues that although of it is simplicity and advantages, the pooled regression may distort the true picture of the relationship between the dependent and independent variables across the firms. Pooled model will be simply estimated by Ordinary Least Square (OLS). However, OLS will be appropriate if no individual (firm) or time specific effects exist. If they exist, the unobserved effects of unobserved individual and time specific factors on dependent variable can be accommodated by using one of the panel data techniques.   According to (Gujarati, 2003) panel data is a special form of pooled data in which the same cross-sectional unit is surveyed over time. It helps researchers to substantially minimize the problems that arise when there is an omitted variables problems such as time and individual-specific variables and to provide robust parameter estimates than time series and (or) cross sectional data. All the empirical models that have been tested by using pooled data analysis and tested again on the basis of panel data analysis techniques (Fixed Effects and Random Effects).   3.3.2 The fixed effects model (FEM) Fixed effects technique allows control for unobserved heterogeneity which describes individual specific effects not captured by observed variables. According to Gujarati (2003) the fixed effect model takes into account the specific effect of each firm â€Å"the individuality† by allowing the intercept vary across individuals (firms), but each individual’s intercept does not vary over time. However, it still assumes that the slope coefficients are constant across individuals or over time. Two methods used to control for the unobserved fixed effects within the fixed effects model; the first differences and Least Square Dummy variables (LSDV) methods.  For the purposes of the current study, (LSDV) was used where; two sets of dummy variables (industry, and year dummy variables). The additional dummy variables control for variables that are constant across firms but change over time. Therefore, the combine time and individual (firm) fixed effects model eliminates the omitted variables bias arising both from unobserved factors that are constant over time and unobserved factors that are constant across firms. However, fixed effects model consumes the degrees of freedom, if estimated by the Least Square Dummy Variable (LSDV) method and, too many dummy variables are introduced (Gujarati, 2003). Furthermore, with too many variables used as regressors in the models, there is the possibility of multicollinearity. It is worth noting that OLS technique used in estimating fixed effects model. 3.3.3 The Random Effects Model (REM) By contrast, fixed effects model, the unobserved effects in random effects model is captured by the error term (ÃŽ µit) consisting of an individual specific one (ui) and an overall component (vit) which is the combined time series and cross-section error. Moreover, it treats the intercept coefficient as a random variable with a mean value (ÃŽ ±0) of all cross-sectional (firms) intercepts and the error component represents the random deviation of individual intercept from this mean value (Gujarati, 2003). Consequently, the individual differences in the intercept values of each firm are reflected in the error term (ui). On the other hand, the Generalized Least Square (GLS) used in estimating random affects model.  This is because the GLS technique takes into account the different correlation structure of the error term in the Random Effect Model (REM) (Gujarati, 2003). 3.3.4 Statistical specification tests The study uses three specification tests to identify which empirical method is the best. These tests are used for testing the fixed effect model versus the pooled model (F-statistics), the random effect model versus pooled model (Lagrange Multiplier test) (LM), and the fixed effect model versus the random effect model (Hausman test). The following sub-sections offer brief disc Impacts on Agency Cost Theory Impacts on Agency Cost Theory The main purpose of this research is to investigate how the determinants of the capital structure (leverage) and the dividend payout policy impact the agency cost theory. Literature review part picked up the relevant material related to agency theory, leverage, and dividends payout policy. The literature review section goes through the agency cost literature, and explores the financial policies; the capital structure (leverage), and the dividend payout policy and that these policies would influence the agency cost theory. 2.1 Agency theory Literature The notion of the agency theory is widely used in economics, finance, marketing, legal, and social sciences; Jensen and Meckling (1976) initiated and developed it. Capital structure (leverage) for the firms is determined by agency costs, i.e., costs related to conflict of interests between various groups including managers, which have claims on the firm’s resources (Harris and Raviv, 1991). Jensen and Meckling (1976) defined the agency relationship as â€Å"a contract under which one or more persons (the principal) engage another person (the agent), to perform some service on their behalf which involves delegating some decision making authority to the agent† pp.308. Assuming that both parties utility maximizes, the agents are not possible to act in the best interest of the principal. Furthermore, Jensen and Meckling (1976) contended that the principal can limit divergences from his interest by establishing appropriate incentives for the agent, and by incurring monitoring costs (pecuniary and non pecuniary), which are designed to limit the aberrant activities of the agent. Jensen and Meckling (1976) argued that the agency costs are unavoidable, since the agency costs are borne entirely by the owner. Jensen and Meckling (1976) contended that the owner is motivated to see these costs minimized. Authors who initiated and developed the agency theory have argued that if the owner manages a wholly owned firm, then he can make operating decisions that maximise his utility. The agency costs are generated if the owner manager sells equity claims on the firms, which are identical to his.  It also generated by the divergence between his interest and those of the outside shareholders, since he then bears only a fraction of the costs of any non-pecuniary benefits he takes out maximizing his own utility (Jensen and Meckling, 1976). Jensen and Meckling (1976) suggested two types of conflicts in the firm; First of all, the conflict between shareholders and managers arises because managers hold less than a hundred percent of the residual claim. Therefore, they do not capture the entire gain from their profit enhancement activities, but they do bear the entire cost of these activities. For example, managers can invest less effort in managing firm resources and may be able to transfer firm resources to their own, personal benefit, i.e., by consuming â€Å"perquisites† such as a fringe benefits. The manager bears the entire cost of refraining from these activities but captures only a fraction of the gain. As a result, managers over indulge in these interests relative to the level that would maximize the firm value. This inefficiency reduced the large fraction of the equity owned by the manager. Holding constant the manager’s absolute investment in the firm, increases in the fraction of the firm financed by debt increases the manager’s share of the equity and mitigates the loss from conflict between the managers and shareholders. Furthermore, as pointed out by Jensen (1986), since debt commits the firm to pay out cash, it reduces the amount of free cash flow available to managers to engage in these types of interests.  As a result, this reduction of the conflict between managers and shareholders will constitute the benefit of debt financing. Second, they also suggested that the conflict between debt holders and shareholders arises because the debt contract, gives shareholders an incentive to invest sub optimally. Especially when the debt contract provides that, if an investment yields large returns, well above the face value of the debt, shareholders capture most of the gain. However, if the investment fails, debt holders bear the consequences. Therefore, shareholders may benefit from investing in very risky projects, even if they are under valued; such investments result in an adverse in the value of debt. Lasfer (1995) argued that debt exacerbates the conflict between debt holders and shareholders. Shareholders will benefit from investments in risky projects at the expense of debt holders.  If the investment yields higher return than the face value of debt, shareholders capture most of the gain, however, if the investment fails, debt holders lose, given that. Therefore, shareholders protected by the limited liability. On the other hand, if the benefits captured by debt holders reduce the returns to shareholders, then an incentive to reject positive net present projects has created. Thus, the debt contract gives shareholders incentives to invest sub optimally. In addition, Myers (1977) argued that the firms with many growth opportunities should not be financed by debt, to reduce the negative net value projects.   Furthermore, some of arguments have been debated that the magnitude of the agency costs varies among firms. It will depend on the tastes of managers, the ease with which they can exercise their own preferences as opposed to value maximization in decision making, and the costs of monitoring and bonding activities. Therefore, the agency costs depend upon the cost of measuring the manager’s performance and evaluating it (Jensen and Meckling, 1976). (Jensen, 1986) either points out that when firms make their financing decision, they evaluate the advantages that may arise from the resolution of the conflicts between managers, shareholders and from long run tax shields.   In addition, Lasfer (1995) argues that debt finance creates a motivation for managers to work harder and make better investment decisions. On the other hand, debt works as a disciplining tool, because default allows creditors the option to force the firm into liquidation. Debt also generates information that can be used by investors to evaluate major operating decisions including liquidation (Harris and Raviv, 1990). Jensen (1986) debated that when using debt without retention of the proceeds of the issue, bonds the managers to meet their promise to pay future cash flows to the debt holders. Thus, debt can be an effective substitute for dividends. By issuing debt in exchange for stock, managers are bonding their promise to pay out future cash flows in a way that cannot be accomplished by simple dividend increases. Consequently, managers give recipients of the debt the right to take the firm to the bankruptcy court if they do not maintain their commitment to make the interest and principle payments. Thus, debt reduces the agency costs of free cash flow by reducing the cash flow available for spending at the discretion of managers. Jensen (1986) claimed that these control effects of debt are a potential determinant of capital structure. In practice, it is possible to reduce the owner manager non pecuniary benefits; by using these instruments external auditing, formal control systems, budget restrictions, and the establishment of incentive compensation systems serve to identify the manager’s interests more closely with those of the outside shareholders (Jensen and Meckling, 1976). Jensen (1986) suggested that leverage and dividend may act as a substitute mechanism to reduce the agency costs. Agency cost models predict that dividend payments can reduce the problems related to information asymmetry. Dividend payments might be consider also as a mechanism to reduce cash flow under management control, and help to mitigate the agency problems (Rozeff, 1982, and Easterbrook, 1984). Therefore, paying dividends may have a positive impact on the firms value. â€Å"Agency theory posits that the dividend mechanism provides an incentive for managers to reduce the costs related to the principal agent relationship, one way to reduce agency costs is to increase dividends† Baker and Powell (1999). They also claim that firm use the dividends use as a tool to monitor the management performance. Moreover, Easterbrook (1984) and Jensen (1986) argue that agency costs exist in firms because managers may not always want to maximize shareholder’s wealth due to the separation of ownership and control. Jensen (1986) addresses the free cash flow theory, in terms of this theory the conflict of interest between managers and stockholders is rooted in the presence of informational and self interest behavior. He defines the free cash flow as â€Å"cash flow in excess of that required to fund all projects that have positive net present value when discounted at the relevant cost of capital† (Jensen,1986). Within the context of the free cash flow hypothesis, firms prefer to increase their dividends and distribute the excess free cash flow in order to reduce agency costs. Consequently, markets react positively to this type of information. This theory is attractive because it is consistent with the evidence about investment and financing decisions (Jensen, 1986, Frankfurter and Wood, 2002). 2.2 Leverage Literature This section reviews the determinants of capital structure by different relevant literatures. Titman and Wessels (1988) study is considered to be one of the leading studies in the developed markets. They tried to extend the empirical work in capital structure theory by examining a much broader set of capital structure theories, and to analyze measures of short term, long term, and convertible debt. The data covers the US industrial companies from 1974 to 1982, and they used a factor analytic approach for estimating the impact of unobservable attributes on the choice of corporate debt ratios. As a result, the study confirms these factors, collateral values of assets, non-debt tax shields, growth, and uniqueness of the business, industry classification, firm size, and firm profitability. They also found that there is a negative relationship between debt levels and the uniqueness of the business. In addition, short term debt ratios have a negative relationship to firm size. However, they do not provide support for the effect on debt ratios arising from non debt tax shields, volatility, collateral value of assets, and growth. In Jordan, Al-Khouri and Hmedat (1992) aimed to find the effect of the earnings variability on capital structure of Jordanian corporations from the period from 1980 to 1988. They included 65 firms. The study used a multivariate regression approach with financial leverage as the dependent variable measured in three ways; first, long term debt over total assets, secondly, short term debt over total assets, and finally, short term debt plus long term debt over total assets. The standard deviation of the earnings variability and the size of the firm measured as independent variables. They concluded that the firm size is considered as a significant factor in determining the capital structure of the firm, and insignificant relationship between the earning variability and financial leverage of the firm. Furthermore, they suggest that the type of industry is not considered as a significant factor in determining the capital structure of the firm. Rajan and Zingales (1995) provided international evidence about the determinants of capital structure. They examined the capital structure in other countries related to factors similar to those that influence United States firms. The database contains 2583 companies in the G7 countries. They used regression analysis with the firm’s leverage (total debt divided by total debt plus total equity) as the dependent variable. Tangible assets, market to book ratio, firm size, and firm profitability used as independent variables. They found that in market bases firms with a lot of fixed assets are not highly levered, however, they supported that a positive relationship exists between tangible assets, and firms size, and capital structure (leverage). On the contrary, they confirmed that there is a negative relationship between leverage and the market to book ratio, and profitability. From the capital structure literature, Ozkan (2001) also investigated that the determinants of the target capital structure of firms and the role of the adjustment process in the UK using a sample of 390 firms. The multiple regression approach (panel data) was used to measure the debts by total debt to total assets, on the one hand. He also used in his model, non debt tax shield, firm size, liquidity, firm profitability, and firm growth as an independent variables. He confirmed that the profit, liquidity, non debt tax shield, and growth opportunities have a negative relationship to capital structure (leverage). Finally, he supported that there is a positive effect arising from size of firms on leverage. The study provided evidence that the UK firms have long term target leverage ratios and that they adjust quickly to their target ratios. The study by Booth et al. (2001) is considered as a one of the leading studies in the developing countries. It aimed to assess whether capital structure theory is applicable across developing countries with different institutional structures. The data include balance sheets and income statements for the largest companies in each selected country from the year 1980 to 1990. It included 10 developing countries: India, Pakistan, Thailand, Malaysia, Zimbabwe, Mexico, Brazil, Turkey, Jordan, and Korea. The study used multivariate regression analysis with dependent variables; total debt ratio, long term book debt ratio, and long term market to debt ratio. The independent variables are; average tax rate, tangibility, business risk, firm size, firm profitability, and market to book ratio. Booth et al. found that the more profitable the firm the lower the debt ratio, regardless how the debt ratio is defined. In addition, the higher the tangible assets mix, the higher is the long term debt ratio but the smaller is the total debt ratio. Finally, it concluded that debt ratios in developing countries seem to be affected in the same way by the same set of variables that are significant in developed countries. Voulgaris et al. (2004) investigated the determinants of capital structure for Greek manufacturing firms. The study used panel data of two random samples one for small and medium sized enterprises (SMEs) including 143 firms and another for large sized enterprises (LSEs) including 75 firms for the period from 1988 to 1996. It used a leverage model as a dependent variable (short run debt ratio, long run debt ratio, and total debt ratio). On the other hand, It used firm size, asset structure, profitability, growth rate, stock level, and receivables as independent variables. The study suggested that there are similarities and differences in the determinants of capital structure among the two samples. The similarities include that the firm size and growth opportunities positively related to leverage. While, they confirm that the profitability has a negative relationship to leverage. Moreover, they pointed out the differences that the inventory period, and account receivables collection period have been found as determinants of debt in SMEs but not in LSEs. Liquidity doest not affect LSEs leverage, but it affects the SMEs. Finally, they also suggested that there is a positive relationship between profit margins and short term debt ratio only for SMEs. Voulgaris et al. (2004) have debated this arguments as; ‘‘the attitude of banks toward small sized firms should be changed so they provide easier access to long-term debt financing’’. In addition, â€Å"enactment of rules that will allow transparency of operations in the Greek stock market and a healthier development of the newly established capital market for SMEs will assist Greek firms into achieving a stronger capital structure’’. 2.3 Dividends payout ratio literature Dividend payout ratios vary between firms and the dividend payout policy will impact the agency cost theory. Rozeff (1982) investigated in his study that the dividends policy will be rationalize by appealing the transaction cost and agency cost associated with external finance. Moreover, Rozeff (1982) had found evidences supporting how the agency costs influence the dividends payout ratio. He found that the firms have distributed lower dividend payout ratios when they have a higher revenue growth, because this growth leads to higher investment expenditures.  This evidence supports the view of the investment policy affect on the dividend policy; the reason for that influences is that would the external finance be costly. Conversely, he found that the firms have distributed higher dividends payouts when insiders hold a lower portion of the equity and (or) a greater numbers of shareholders own the outside equity. Rozeff (1982) pointed out that this evidence supports that the dividend payments are part of the firm’s optimum monitoring and that bonding package reduces the agency costs. Moreover, if the agency cost declines when the dividend payout does and if the transaction cost of external finance increases when the dividend payout is increased as well, then minimization of these costs will lead to a unique optimum for a given firm. In addition, Hansen, Kumar, and Shome [HKS], (1994) pointed out the relevance of the monitoring theory for explaining the dividends policy of regulated electric utilities. From an agency cost perspective, they emphasized their ideas that the dividends promote monitoring of what they call the shareholders regulator conflict. Therefore, it is a monitoring role of dividends. On the contrary, Easterbrook’s (1984) has noted that the dividends monitoring of the shareholders managers conflict. They also have observed that the utilities firms have a discipline of monitoring mechanism for controlling agency cost, depending on the relative cost effectiveness of those costs (Crutchly and Hensen, 1989). The regulator process will impact the conflict between the shareholders and mangers, by mitigate the managers’ power to appropriate shareholders’ wealth and consume perquisites (Hansen et al. 1994). On the other hand, they argued this issue by the cost-plus concept, regulators may set into motion of managerial incentive structure that potentially conflicts with shareholders interests, this concept solve the shareholders-regulators concept since the sources of the conflict lies in differences in the perceptions of what constitutes fair cost plus. Therefore, the regulation can control some of the agency cost while exacerbating others. In their study, they conduct also that the managers and shareholders of unregulated firms have a several mechanisms whether, internal or external, for controlling agency cost. In addition, they observed that the dividend policy to reduce the agency theory is not limited, depending on their findings they suggested that the cost of dividend payout policy might be below the costs paid by other types of firm. In fact the utilities company maintain high debt ratio that would maintain as well as equity agency costs. Aivazian et al. (2003b) compare the dividend policy behaviour of eight emerging markets with dividend policies in the US firms in the period from 1980 to 1990. The sample included firms from; Korea, Malaysia, Zimbabwe, India, Thailand, Turkey, Pakistan, and Jordan. They found that it is difficult to predict dividend changes for such emerging markets. This is because the quality of firms with reputations for cutting dividends is somehow similar to those who increase their dividends, than for the US control sample. In addition, current dividends are less sensitive to past dividends than for the US sample of firms. They also found that the Lintner model[1] does not work well for the sample of emerging markets. These results indicate that the institutional frameworks in these emerging markets make dividend policy a weak technique for signaling future earnings and reducing agency costs than for the US sample of firms. Furthermore, Omran and Pointon (2004) investigated the role of dividend policy in determining share prices, the determinants of payout ratios, and the factors that affect the stability of dividends for a sample of 94 Egyptian firms. They found that retentions are more important than dividends in firms with actively traded shares, but that accounting book value is more important than dividends and earnings for non-actively traded firms. However, when they combined both the actively traded and non-traded firms, they found that dividends are more important than earnings. In the determinants of payout ratios, they found that there is a negative relationship between the leverage ratio and market to book ratio, tangibility, and firm size on the one hand, to the payout ratios in actively traded firms. On the contrary, they also found that there is a positive relationship between the business risk, market to book and firm size (measured by total assets) to payout ratios in non-actively traded firms. Furthermore, for the whole sample, leverage has a positive relationship with payout ratios, while firm size (measured by market capitalization) is negatively related to payout ratios. Finally, the stepwise logistic regression analysis shows that decreasing dividends is associated with lack of liquidity and overall profitability. In addition, increasing dividends is associated with higher overall profitability. 2.4 Summary In this chapter the relevant literatures addressing the reviews of the agency cost theory related to the financial policies. It also gives a theoretical background on how the conflicts of interests arise between the agents (managers) and the principal (shareholders). The second and third sections present the determinants of leverage and dividend payout policy. The following chapter will go through the description of data, and data methodology was employed for this dissertation. 3. Methodology, Research Design and Data Description The aim of the current study is to investigate firstly, the empirical evidence of the determinants of leverage and dividend policy under the agency theory concept for the period 2002-2007. The majority of the previous studies in the field of capital structure have made in the context of developed countries such as USA and UK. It is important to investigate the main determinants of leverage and dividend policy in developing countries where, capital markets, are less developed, less competitive and suffering from the lack of compatible regulations and sufficient supervision This chapter will explain the research methodology of this study. This chapter also identifies the sample of the study. Moreover, it presents an illustration of the econometric techniques that have been employed. In addition, this chapter gives a brief explanation of the specification tests used in the study to identify which technique is the best for the data set. This chapter structured as follows; Section (3.1) presents data description.  Section (3.2) presents the sample of the study. Section (3.3) discusses the econometric techniques employed in the study. Finally, Section (3.4) provides a brief summary. 3.1 Data Description The data used in the study are secondary data for companies listed at Amman Stock Exchange (ASE) for the period of 2002-2007. The data was extracted from the firm’s annual reports, and from Amman Stock Exchange’s publications (The Yearly Companies Guide, and Amman Stock Exchange Monthly Statistical Bulletins). Data is readily available in the form of CD and on the website of the Amman Stock Exchange. The reason for the study period selection was to minimize the missing observations for the sample companies. Moreover, a different reporting system has been used since 2000. The application of the new reporting system was the result of the transparency act which was launched in 1999, and forced all companies listed in Amman Stock Exchange to disclose their financial information and publish their annual reports according to the International Financial Reporting Standards. In other words, this data series for the period from 2002-2007 was chosen in terms of consistency and comparability purposes. 3.2 Sample of the study The sample of the study consists of the Jordanian Manufacturing companies listed on the Amman Stock Exchange for the period of 2002-2007. The total number of the companies listed in ASE at the end of year 2007 was 215. Officially, these companies are divided into four main economic sectors; Banks sector, Insurance sector, Services sector and finally Industrial sector. Moreover, this study is concerned only with Jordanian manufacturing companies that their stocks are traded in the organized market. It is important to note that the capital structure of financial firms has special characteristic when compared to the capital structure of non financial firms, they also have special tax treatment (Lester, 1995). On the other hand, the financial firms have a higher leverage rate, which may tend to make the analysis results biased. Moreover, financial firms their leverage is affected by investor insurance schemes (Rajan and Zingals, 1995). For these reasons, the potential sample of the study consists of non financial (Manufacturing) companies that are still listed in Amman Stock Exchange. The total number of industrial companies listed in ASE at the end of year 2007 was 88 companies, which are 40.93% of the total number of the companies listed in that market. The study conducts the following criteria in selecting the sample upon the Jordanian manufacturing companies by excluding all the firms that was incorporated after year 2002, and all the firms that have merged or acquired during this period, further, the firms have liquidated or delisted by the Amman Stock Exchange, and finally, the study have also excluded the firms that have information missing for that period. The application for those criteria has resulted in 52 samples of manufacturing companies. The data for the variables that are included in the study models is tested using three different econometric techniques which will be discuss briefly in the next sections. 3.3 Econometrics techniques Hairs et al. (1998) argued that the application of econometrics technique depends on the nature of data employed in the study, and to what extent it would be realised to the research objectives. In order to find a best and adequate data model, the current study employs pooled data technique and panel data analysis which is usually estimated by either fixed effect technique or random effects technique.  The following sections provide a brief discussion on the econometrics techniques that the current study uses to estimate the empirical models. 3.3.1 Pooled Ordinary Least Square (OLS) technique All the models used in the study have been tested by the pooled data analysis technique. The pooled data is the data that contains pooling of time series and cross-sectional observations (combination of time series and cross-section data) (Gujarati, 2003). The pooled data analysis has many advantages over the pure time series or pure cross sectional data. It generates more informative data, more variability, less collinearity among variables, more degrees of freedom, and more efficiency (Gujarati, 2003). The underlying assumption behind the pooled analysis is that, the intercept value and the coefficients of all the explanatory variables are the same for all the firms, as well as they are constant over time (no specific time or individual aspects). It also assumes that the error term captures the differences between the firms (across-sectional units) over the time. However, (Gujarati, 2003) has pointed out that these assumptions are highly restrictive. He argues that although of it is simplicity and advantages, the pooled regression may distort the true picture of the relationship between the dependent and independent variables across the firms. Pooled model will be simply estimated by Ordinary Least Square (OLS). However, OLS will be appropriate if no individual (firm) or time specific effects exist. If they exist, the unobserved effects of unobserved individual and time specific factors on dependent variable can be accommodated by using one of the panel data techniques.   According to (Gujarati, 2003) panel data is a special form of pooled data in which the same cross-sectional unit is surveyed over time. It helps researchers to substantially minimize the problems that arise when there is an omitted variables problems such as time and individual-specific variables and to provide robust parameter estimates than time series and (or) cross sectional data. All the empirical models that have been tested by using pooled data analysis and tested again on the basis of panel data analysis techniques (Fixed Effects and Random Effects).   3.3.2 The fixed effects model (FEM) Fixed effects technique allows control for unobserved heterogeneity which describes individual specific effects not captured by observed variables. According to Gujarati (2003) the fixed effect model takes into account the specific effect of each firm â€Å"the individuality† by allowing the intercept vary across individuals (firms), but each individual’s intercept does not vary over time. However, it still assumes that the slope coefficients are constant across individuals or over time. Two methods used to control for the unobserved fixed effects within the fixed effects model; the first differences and Least Square Dummy variables (LSDV) methods.  For the purposes of the current study, (LSDV) was used where; two sets of dummy variables (industry, and year dummy variables). The additional dummy variables control for variables that are constant across firms but change over time. Therefore, the combine time and individual (firm) fixed effects model eliminates the omitted variables bias arising both from unobserved factors that are constant over time and unobserved factors that are constant across firms. However, fixed effects model consumes the degrees of freedom, if estimated by the Least Square Dummy Variable (LSDV) method and, too many dummy variables are introduced (Gujarati, 2003). Furthermore, with too many variables used as regressors in the models, there is the possibility of multicollinearity. It is worth noting that OLS technique used in estimating fixed effects model. 3.3.3 The Random Effects Model (REM) By contrast, fixed effects model, the unobserved effects in random effects model is captured by the error term (ÃŽ µit) consisting of an individual specific one (ui) and an overall component (vit) which is the combined time series and cross-section error. Moreover, it treats the intercept coefficient as a random variable with a mean value (ÃŽ ±0) of all cross-sectional (firms) intercepts and the error component represents the random deviation of individual intercept from this mean value (Gujarati, 2003). Consequently, the individual differences in the intercept values of each firm are reflected in the error term (ui). On the other hand, the Generalized Least Square (GLS) used in estimating random affects model.  This is because the GLS technique takes into account the different correlation structure of the error term in the Random Effect Model (REM) (Gujarati, 2003). 3.3.4 Statistical specification tests The study uses three specification tests to identify which empirical method is the best. These tests are used for testing the fixed effect model versus the pooled model (F-statistics), the random effect model versus pooled model (Lagrange Multiplier test) (LM), and the fixed effect model versus the random effect model (Hausman test). The following sub-sections offer brief disc