Volume 12 Issue 1 2016


Muhammad Rizwan
Middlesex University, UK.

Muhammad SadiqShahid
Bahauddin Zakariya University, Multan.

Muhammad Hassan Bucha
Bahauddin Zakariya University, Multan.

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 -
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 PDF
Paper Link
Page 307-327