INVESTOR CONFIDENCE, CORPORATE GOVERNANCE, STOCK LIQUIDITY AND DIVIDEND POLICY
Download| Volume 12 Issue 1 2016 | |
|---|---|
| Author(s): |
Muhammad Rizwan
Muhammad SadiqShahid
Muhammad Hassan Bucha
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| Abstract | The objective of this study is to examine the impact of investor confidence, corporate governance, and stock liquidity on the dividend policy of firms listed on Pakistan stock exchanges from 2010-2015. The liquidity constraint enabled a superior association with the interests of the controlling shareholders, particularly outside investors, which make a significant enhancement in firms’ liquidity and governance. Our results indicate that dividends have a less significant impact on investor confidence after corporate governance. Our interpretation is that the improvement in corporate governance, especially the improvement in the alignment between growth opportunities and cash dividends, may take a longer time to emerge. These findings provide strong evidence that shifts in corporate governance and stock liquidity influence the dividend policy of a firm in a substantial manner. Another implication is that stock liquidity matters in firms’ dividend decision making; the liquidity deficiency is compensated by large cash dividends. |
| Keywords | Dividend Policy, Corporate Governance, Investor Confidence and Stock Liquidity |
| Year | 2016 |
| Volume | 12 |
| Issue | 1 |
| Type | Full Length Paper |
| Recognized by | Higher Education Commission of Pakistan, HEC | Category | "Y" | Journal Name | IBT Journal of Business Studies | Publisher Name | ILMA University | Jel Classification | - | DOI | http://dx.doi.org/10.46745/ilma.jbs.2016.12.01.18 | ISSN no (E, Electronic) | 2409-6520 | ISSN no (P, Print) | 2416-8393 | Country | Pakistan | City | Karachi | Institution Type | University | Journal Type | Open Access | Manuscript Processing | Blind Peer Reviewed | Format | Paper Link | http://ibtjbs.ilmauniversity.edu.pk/journal/jbs/12.1/18.pdf | Page | 307-327 |