Do Emerging Market Firms Follow Different Dividend Policies From U.S. Firms?

Aivazian, Varouj A.; Booth, Laurence; Cleary, Seán

doi:10.1111/1475-6803.00064

Cited by 354 publications

(416 citation statements)

References 11 publications

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“…Dividend policy and asset structure Aivazian et al (2003a), and Al-Najjar and Hussainey (2009), found a negative association between dividend policy and asset structure, which implies that firms with more tangible assets disburse lower amounts of dividends. This is due to the assumption that, in the existence of a large size of tangible assets in the firm, the size of short-term assets' tends to be low.…”

Section: Dividend Policy and Firm Sizementioning

confidence: 97%

“…Consistent with prior literature, Ferris et al (2006) found that profitability, investments opportunities, and firm size are the most effective factors in determining dividend policy of UK firms. Jensen et al (1992), Aivazian et al (2003a) and Al-Najjar and Hussainey (2009), among others, empirically examined the relationship between dividend payments and profitability. They found that profitable firms are more likely to pay dividends than nonprofitable firms.…”

Section: Dividend Policy and Firm Characteristicsmentioning

confidence: 99%

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Does asymmetric information drive UK dividends propensity?

Basiddiq¹,

Hussainey

2012

Journal of Applied Accounting Research

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Purpose: We extend and contribute to prior UK research on the association between information asymmetry and dividends propensity. We investigate the impact of the number of analysts following firms, a proxy for information asymmetry, on dividends propensity. Methodology:Using a 282 UK FTSE-All Share non-financial/non-utilities firms with fiscal year ends on 2007, we use a multiple regression model to investigate the association between dividends and analysts following. Findings:We find that after controlling for firm-specific characteristics, there is a significant negative association between the number of analysts following firms and dividend propensity. Our finding suggest that higher coverage of financial analysts for UK firms reduces levels of information asymmetry between managers and shareholders which results in lower dividend propensity. These findings are consistent with agency theory and pecking order theory, but inconsistent with signaling theory. Originality:We contribute to prior research related to the determinants of dividend propensity by being the first UK study to examine the association between dividend propensity and information asymmetry. Classification: Research Paper

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Section: Dividend Policy and Firm Sizementioning

confidence: 97%

Section: Dividend Policy and Firm Characteristicsmentioning

confidence: 99%

Does asymmetric information drive UK dividends propensity?

Basiddiq¹,

Hussainey

2012

Journal of Applied Accounting Research

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“…Titman and Wessels (1988), Aivazian, Booth and Cleary (2003) suggested that there is a negative relationship between asset tangibility and dividend payout. The more the tangible assets in the firm will lead the lower the size of the short-term assets which may serve as collateral against debt financing.…”

Section: Equation 3: Dividend Equationmentioning

confidence: 99%

Managerial Ownership, Leverage and Dividend Policies: Empirical Evidence from Vietnam’s Listed Firms

Vo¹,

Nguyen²

2014

IJEF

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The purpose of this paper is to examine the interrelationship among managerial ownership, leverage and dividend policies. The analysis is performed using three-stage least squares (3SLS) estimation on a sample of 81 listed firms on HCM City Stock Exchange (HOSE) during the period 2007-2012. The empirical results indicate that managerial ownership has a negative relationship with leverage. This finfing is supported by Agency Theory. Also, the results provide strong support for Pecking Order Theory, which suggests that there is a negative relationship between leverage and dividend. However, contrary to expectations, managerial ownership is found to have positive impact on dividend. It means that companies with higher levels of managerial holdings are consciously choosing higher level of dividends.

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“…Rozeff (1982) and Jensen (1986) find that firms with higher debt financing avoid paying more dividends to reserve earnings. Aivazian et al (2003) find that firms with higher investment opportunities tend to pay higher dividends. Kania and Bacon (2005) find that firms with higher profits distribute higher dividend payment.…”

Section: Introductionmentioning

confidence: 91%

Dividend Policy and Investment Decisions of Korean Banks

Lee¹

2015

RES

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The objective of this study is to investigate the inter-relationship between banks' dividend policy and investment decisions in terms of risk management and profit maximization. From the panel regression analysis, this study finds that the bank's dividend policy appears to be closely related to both incentives of profit maximization and risk management. In this study our empirical methodology is based on the general notion that the bank's expectation on future economic condition is best captured by various measures of the components of ex-ante risky asset portfolios as well as the widely used risk measures such as capital ratio, nonperforming loans and return on asset which simply reflect the bank's historical performance. We find that when the banks have positive expectation on future economic condition, they tend to increase the proportion of risky asset portfolios to maximize expected profits rather than putting highest priority on risk management of the bank, and tend to pay more dividends based on higher expected profits. On the other hand, when the expectation on future economic condition is negative, the banks tend to put highest priority on the bank's risk management by increasing the proportion of safe asset portfolios and decreasing dividends based on lower expected profits.

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Do Emerging Market Firms Follow Different Dividend Policies From U.S. Firms?

Cited by 354 publications

References 11 publications

Does asymmetric information drive UK dividends propensity?

Does asymmetric information drive UK dividends propensity?

Managerial Ownership, Leverage and Dividend Policies: Empirical Evidence from Vietnam’s Listed Firms

Dividend Policy and Investment Decisions of Korean Banks

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