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Decision to pay dividends and ownership structures in Nigeria

Adamu, Adamu Idris and Ishak, Rokiah and Hassan, Nor Laili (2019) Decision to pay dividends and ownership structures in Nigeria. The International Journal of Banking and Finance, 14. pp. 27-44. ISSN 1617-722

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Empirical evidence on how ownership structures influence decision to pay dividends remain unclear in the dividend policy literature. This paper is set to investigate the association between ownership structures and decision to pay dividends. The sample firms of this study consist of nonfinancial firms listed on the Nigerian Stock Exchange for the period 2011 to 2015 with 270 firm-year observations and logit regression models used to examine the relationship. The study revealed strong evidence that institutional investors were positively related to the decision to pay dividends. However, managerial shareholding was found to have an inverse effecton firms’ probability to pay dividends. Additional analysis was carried out only on dividend payers and the results were also consistent with the hypothesis. Despite this, the managerial investors were somehow weak when the sample was reduced to dividend payers.Cumulatively, the results are robust and show support of the agency theory and hence, imply that institutional investors in Nigeria have preference for dividend payers.

Item Type: Article
Uncontrolled Keywords: Decision to pay dividends, ownership structures, emerging market.
Subjects: H Social Sciences > HC Economic History and Conditions
Depositing User: Mrs. Norazmilah Yaakub
Date Deposited: 18 Oct 2020 01:21
Last Modified: 18 Oct 2020 01:21

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