scholarly journals Dividend policy and political uncertainty: Does firm maturity matters?

2020 ◽  
Vol 7 (2) ◽  
pp. 139-150
Author(s):  
Adamu Adamu Idris ◽  
Hussaini Bala ◽  
Naziru Suleiman
Keyword(s):  
Fixed Effects ◽  
Dividend Policy ◽  
Ordinary Least Squares ◽  
Growth Options ◽  
Political Uncertainty ◽  
Cash Dividend ◽  
Data Set ◽  
Life Cycle Theory ◽  
Robust Standard Error ◽  
Firm Maturity

Previous evidence has shown that numerous factors influence dividend policy, but how political uncertainty influences a firm’s cash dividend policy remains blurry. This study examines the relationship between cash dividends and political uncertainty in Nigeria. More so, the study analyses the interaction effect of firm maturity on the association between the cash dividend and political uncertainty. The study employed an ordinary least squares dummy variable fixed effects with robust standard error on a data set of non-financial listed Nigerian firms. The results revealed that political uncertainty strongly influences a firm’s cash dividend, and a matured firm tends to pay greater dividends than a firm with more growth options. Thus, this finding suggests that matured larger firms pay more dividends during a period of uncertainty. Consequently, the study supported the agency theory and life cycle theory.

Does earnings transparency affect corporate payout decisions?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Yogesh Chauhan ◽  
Rajesh Pathak
Keyword(s):  
Path Analysis ◽  
Fixed Effects ◽  
Financial Constraints ◽  
Dividend Policy ◽  
Cash Dividend ◽  
Content Type ◽  
Listed Firms ◽  
Panel Data Estimation ◽  
Signaling Hypothesis ◽  
Data Estimation

PurposeThe paper examines how earnings transparency affects dividend payouts for Indian firms. The authors also explore the channels through which earnings transparency affects dividend payouts.Design/methodology/approachThe authors employ panel data estimation with fixed effects to examine the role of earnings transparency on dividend payouts. The authors also use path analysis to explore causation. The paper uses a sample of more than 2000 Indian listed firms, over the period 2001–2016.FindingsThe authors report that firms showing grater earning transparency pay more cash dividend. Their results do not support the signaling hypothesis about the dividend. However, these results provide explicit support to the theory that corporate dividend policy is an outcome of information asymmetry. Moreover, the path analysis reveals the effect of earnings transparency on corporate payout through the financial constraint channel. The results are robust to idiosyncratic controls; alternate measures of payout; alternate models; endogeneity concerns; and the alternate channel of returning money to stockholders.Practical implicationsManagers should also examine earnings transparency while formulating an adequate dividend policy for their firms. This study also helps investors to identify dividend-paying stocks.Originality/valueThis study particularly contributes to the literature examining the effect of earnings quality on dividend payouts through its effect on financial constraints. We, therefore, connect two streams of research that contemplate the relation between accounting-based information variables and dividend payouts and the relationship between financial constraints and dividend payouts. Moreover, using path analysis uniquely, the authors provide evidence on the relative importance of both the direct and the indirect link.

Determinants of SME growth

2016 ◽  
Vol 39 (9) ◽  
pp. 966-986 ◽  
Author(s):  
Habib Kachlami ◽  
Darush Yazdanfar
Keyword(s):  
Random Effects ◽  
Financial Institutions ◽  
Significant Influence ◽  
Fixed Effects ◽  
Explanatory Power ◽  
Ordinary Least Squares ◽  
Firm Level ◽  
Data Set ◽  
Content Type

Purpose The purpose of this paper is to study the firm-level financial variables affecting the growth of small and medium-sized enterprises (SMEs). Design/methodology/approach The study applies a resource-based view to analyze the firm-level as well as industry-level determinants of SME growth. Empirical evidence has also been provided from a data set of SMEs in Sweden to support the hypotheses. For a robust statistical analysis, three models – ordinary least squares (OLS) regression, random-effects regression and fixed-effects regression – are used to examine the influence of explanatory variables on growth. Findings The findings of this study show a positive and significant influence of profitability, short-term debt and size on a firm’s growth across all three models. Results regarding the influence of long-term debt on growth, however, are mixed. While the results of a fixed-effect model show the negative and significant influence of long-term debt on growth, the results according to OLS and random effects show long-term debt positively related to growth. Research limitations/implications This study has been conducted over a period of four years and in the context of Sweden which may limit the generalizability of its results for longer periods and for different contexts. Moreover, the low explanatory power of the models implies the need to also consider other types of variables, such as managerial or socio-economic variables, to better explain the determinants of SME growth. Practical implications Understanding the determinants of growth can be important for policy makers, SME managers and financial institutions. The findings of this study can be used for designing policies which stimulate SME growth. Realizing the financial resources that influence growth can also help SME managers and financial institutions to understand each other’s need for better cooperation. Originality/value This paper applies different models for analyzing large and cross-sectoral data regarding SME growth in the context of Sweden.

Fertility, female labor participation and income in East Asia

2018 ◽  
Vol 17 (1) ◽  
pp. 69-86
Author(s):  
Yoko Nakagaki
Keyword(s):  
East Asia ◽  
Fixed Effects ◽  
Developed Countries ◽  
Ordinary Least Squares ◽  
Low Fertility ◽  
Labor Participation ◽  
Female Labor ◽  
Data Set ◽  
Content Type ◽  
Fertility Recovery

PurposeThis study aims to apply two recently discovered relationships that describe fertility recovery in developed countries to East Asia: the U-shaped relationship between fertility and FLP (female labor participation) and the inverse-J-shaped relationship between fertility and income.Design/methodology/approachIt uses a panel data set of 176 countries including 13 East Asian countries from 1990 to 2014. Pooled ordinary least squares, fixed-effects and random-effects models are tested.FindingsThe main findings are the following points concerning East Asia: The U-shape and the inverse-J-shape are confirmed, suggesting that fertility recovery could be realized if both FLP and income are high enough and increasing; in the region, the U-shape is peculiar. Lower-income countries’ data move from the upper-right to the bottom, whereas higher-income countries’ data move from the upper-left to the bottom; no country in the region has reached the stage where both FLP and income are high enough.Originality/valueThis is the first paper on East Asia to show the U-shape and the inverse-J-shape concerning fertility recovery and the peculiarity of the U-shape in East Asia. It explains the background of low fertility using the relationship between fertility, FLP and income.

scholarly journals Reverse educational spillovers at the firm level

2017 ◽  
Vol 5 (1) ◽  
pp. 80-106 ◽  
Author(s):  
Uschi Backes-Gellner ◽  
Christian Rupietta ◽  
Simone N. Tuor Sartore
Keyword(s):  
Fixed Effects ◽  
Spillover Effect ◽  
Spillover Effects ◽  
Ordinary Least Squares ◽  
Vocational Education And Training ◽  
Academic Education ◽  
Firm Level ◽  
Data Set ◽  
Content Type ◽  
Education Academic

Purpose The purpose of this paper is to examine spillover effects across differently educated workers. For the first time, the authors consider “reverse” spillover effects, i.e. spillover effects from secondary-educated workers with dual vocational education and training (VET) to tertiary-educated workers with academic education. The authors argue that, due to structural differences in training methodology and content, secondary-educated workers with VET degrees have knowledge that tertiary academically educated workers do not have. Design/methodology/approach The authors use data from a large employer-employee data set: the Swiss Earnings Structure Survey. The authors estimate ordinary least squares and fixed effects panel-data models to identify such “reverse” spillover effects. Moreover, the authors consider the endogenous workforce composition. Findings The authors find that tertiary-educated workers have higher productivity when working together with secondary-educated workers with VET degrees. The instrumental variable estimations support this finding. The functional form of the reverse spillover effect is inverted-U-shaped. This means that at first the reverse spillover effect from an additional secondary-educated worker is positive but diminishing. Research limitations/implications The results imply that firms need to combine different types of workers because their different kinds of knowledge produce spillover effects and thereby lead to overall higher productivity. Originality/value The traditional view of spillover effects assumes that tertiary-educated workers create spillover effects toward secondary-educated workers. However, the authors show that workers who differ in their type of education (academic vs vocational) may also create reverse spillover effects.

scholarly journals Sectoral Analysis of Factors Influencing Dividend Policy: Case of an Emerging Financial Market

2019 ◽  
Vol 12 (3) ◽  
pp. 110 ◽  
Author(s):  
Geetanjali Pinto ◽  
Shailesh Rastogi
Keyword(s):  
Fixed Effects ◽  
Dividend Policy ◽  
Stock Exchange ◽  
Cash Flows ◽  
Ordinary Least Squares ◽  
Free Cash Flow ◽  
Dividend Policies ◽  
Explanatory Factors ◽  
Industrial Sectors ◽  
Free Cash Flow Hypothesis

This study aims to determine whether a firm’s dividends are influenced by the sector to which it belongs. This paper also examines the explanatory factors for dividends across individual sectors in India. This longitudinal study uses balanced data consisting of companies listed on the National Stock Exchange (NSE) of India for 12 years—from 2006 to 2017. Pooled ordinary least squares (POLSs) and fixed effects panel models are used in our estimation. We find that size, profitability, and interest coverage ratios have a significant positive relation to dividend policy. Furthermore, business risk and debt reveal a significantly negative relation with dividends. The findings on profitability support the free cash flow hypothesis for India. However, we also found that Indian companies prefer to follow a stable dividend policy. As a result of this, even firms with higher growth opportunities and lower cash flows continue to pay dividends. We also find evidence that dividend policies vary significantly across industrial sectors in India. The results of this study can be used by financial managers and policymakers in order to make appropriate dividend decisions. They can also help investors make portfolio selection decisions based on sectoral dividend paying behavior.

scholarly journals DOES SIZE OF THE FIRM MATTER IN THE RELATIONSHIP BETWEEN FOREIGN OWNERSHIP AND DIVIDEND POLICY?

2020 ◽  
Vol 24 ◽  
Author(s):  
Adamu ‪Idris Adamu ◽  
Oyindamola Ekundayo ◽  
Hussaini Bala
Keyword(s):  
Dividend Policy ◽  
Foreign Ownership ◽  
Great Tendency ◽  
Cash Dividend ◽  
Data Set ◽  
Listed Firms ◽  
Propensity To Pay ◽  
The Relationship ◽  
Moderating Role

Prior studies have revealed that foreign shareholders have a greater influence on dividend policy. However, it is unclear how foreign owners in large firms affect the propensity to pay dividends. This paper is aimed at exploring the relationship between the propensity to pay dividends and foreign ownership. It also examined the moderating role of firm size on the relationship between the decision to pay cash dividend and foreign ownership. The study uses pooled logistic regression on a data set of non-financial listed firms on the Nigerian Stock Market from 2011 to 2015. The results showed that foreign ownership has a great tendency to influence the propensity of a firm to pay a cash dividend. The effect is more pronounced in larger firms, thus, indicating that in larger firms, foreign owners mitigate agency problems using dividends. Based on the findings, firms should be encouraged to pay a dividend to attract foreign investors and in return will help the firms to acquire the expertise of foreign owners.  

Does Endogeneity in Causal Relationships Matter: A Case of Board Independence and Firm’s Market Valuation

2018 ◽  
Vol 4 (1) ◽  
pp. 19-39 ◽  
Author(s):  
Shivan Sarpal
Keyword(s):  
Firm Value ◽  
Fixed Effects ◽  
Generalized Method Of Moments ◽  
Ordinary Least Squares ◽  
Market Valuation ◽  
Board Independence ◽  
Outside Directors ◽  
Data Set ◽  
Fixed Effects Regression ◽  
The Relationship

The credibility and rectitude of monitoring effectiveness of non-executive (outside) directors has been highly discussed in the past academia. In this light, the present research involves the testing of endogeneity in the relationship between board independence and firm performance as proxied by firm market valuation. It has utilized the multimethodological approach on the data set of top corporates listed in Indian context. Notably, the application of pooled ordinary least squares (OLS) (static as well as dynamic), fixed effects regression, and system generalized method of moments (GMM) approach under dynamic modeling methodologies has demonstrated varying effects, which in turn, too provide manifestation of the predilection for dynamic system GMM, dynamic pooled OLS, and fixed effects over static pooled OLS. Findings of the research have ultimately concluded insignificant relationship between board independence and firm value. This effect remained robust even after controlling for the effect of board size. The implications of the insignificant board independence–firm value relationship have also been discussed and, thereby, offer useful directions to the regulators and policymakers.

scholarly journals A Longitudinal Analysis of the Association between Transition into Marriage and Life Satisfaction and Childhood Parental Divorce as a Moderator

2021 ◽  
Vol 59 (1) ◽  
pp. 113-125
Author(s):  
Yoonjoo Lee
Keyword(s):  
Life Satisfaction ◽  
Fixed Effects ◽  
Parental Divorce ◽  
Panel Study ◽  
Positive Association ◽  
Ordinary Least Squares ◽  
Social Selection ◽  
Data Set ◽  
Nationally Representative ◽  
Fixed Effects Regression

Previous research on the association between marriage and life satisfaction is limited due to the lack of attempts to investigate the time profiles of life satisfaction around marriage. This study addresses unresolved questions about the positive association between marriage and life satisfaction as well as tests if it is moderated by childhood parental divorce. Using 14 waves of the Korean Welfare Panel Study(N=3,890 individuals or 25,338 person-year observations), the author first used an ordinary least squares model with clustered standard errors and found that married people reported higher life satisfaction before marriage, compared to people who remained single during the survey. This result supports a social selection perspective. Next, the author used a fixed effects regression model and found that the transition into marriage was associated with an initial rise and subsequent decline in life satisfaction. Life satisfaction increased after reaching its lowest level in the third year of marriage. Life satisfaction after the transition into marriage was significantly higher than that observed three or more years prior to marriage. The result supports a social causation perspective. Such changing patterns were not moderated by parental divorce during childhood. This study advances the current literature on marriage and life satisfaction by using a nationally representative longitudinal data set as well as by testing social selection and causation perspectives.

The antecedents of corporate social and environmental responsibility discourse in Pakistan: Multiple theoretical perspectives

2019 ◽  
Author(s):  
Muhammad Farhan Basheer ◽  
Saqib Muneer ◽  
Muhammad Atif ◽  
Zubair Ahmad
Keyword(s):  
Institutional Theory ◽  
Least Squares ◽  
Agency Theory ◽  
Stakeholder Theory ◽  
Fixed Effects ◽  
Ordinary Least Squares ◽  
Environmental Responsibility ◽  
Legitimacy Theory ◽  
Discourse Practices ◽  
Corporate Social

The primary purpose of the study is to explore the antecedents of corporate social and environmental responsibilities discourse practices in Pakistan. The industry sensitivity, government shareholding, block holder ownership, print media coverage, environmental monitoring programs, and strategic posture are examined as antecedents of corporate social and environmental responsibility practices. A multidimensional theoretical perspective namely stakeholder theory (ST), institutional theory (IT), agency theory (PAT), and legitimacy theory (LT) is used to conceptualize the phenomena. All the four of perspective theories (positive accounting theory, legitimacy theory, stakeholder theory, and institutional theory) claim that there are ‘pressures’ that impact the organization. How much ‘pressures’ are recognized, managed or satisfied differs from one perspective of theory to the other. To estimate the data, this study uses three sets of panel data models, i.e., the pooled ordinary least squares model (POLS) or constant coefficients model, fixed effects (FEM or least squares dummy variable/LSDV model) and random-effects models. The final sample is comprising of 173 firms over eight years from 2011 to 2017. The firms listed in PSX are included in the sample. Overall the findings of the study have shown agreement with the proposed results. However, the study has provided more support to the institutional theory and stakeholder theory. Keywords: Corporate Social Responsibility, Stakeholders Theory, Agency Theory, Pakistan

scholarly journals Analysis of the New Kuznets Relationship: Considering Emissions of Carbon, Methanol, and Nitrous Oxide Greenhouse Gases—Evidence from EU Countries

2021 ◽  
Vol 18 (6) ◽  
pp. 2907
Author(s):  
Mara Madaleno ◽  
Victor Moutinho
Keyword(s):  
Nitrous Oxide ◽  
Least Squares ◽  
Fixed Effects ◽  
Ghg Emissions ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Ekc Hypothesis ◽  
Long Run ◽  
Short Run ◽  
The Eu

Decreased greenhouse gas emissions (GHG) are urgently needed in view of global health threat represented by climate change. The goal of this paper is to test the validity of the Environmental Kuznets Curve (EKC) hypothesis, considering less common measures of environmental burden. For that, four different estimations are done, one considering total GHG emissions, and three more taking into account, individually, the three main GHG gases—carbon dioxide (CO2), nitrous oxide (N2O), and methane gas (CH4)—considering the oldest and most recent economies adhering to the EU27 (the EU 15 (Old Europe) and the EU 12 (New Europe)) separately. Using panel dynamic fixed effects (DFE), dynamic ordinary least squares (DOLS), and fully modified ordinary least squares (FMOLS) techniques, we validate the existence of a U-shaped relationship for all emission proxies considered, and groups of countries in the short-run. Some evidence of this effect also exists in the long-run. However, we were only able to validate the EKC hypothesis for the short-run in EU 12 under DOLS and the short and long-run using FMOLS. Confirmed is the fact that results are sensitive to models and measures adopted. Externalization of problems globally takes a longer period for national policies to correct, turning global measures harder and local environmental proxies more suitable to deeply explore the EKC hypothesis.

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