This study reports the results of a 1999 survey of Nasdaq-listed firms. Respondents provided information about the importance of 22 different factors that influence their dividend policy. Our results suggest that many managers of Nasdaq firms make dividend decisions consistent with Lintner's (1956) survey results and model. The results also show significant differences between the manager responses of financial and non-financial firms on nine of the 22 factors. This finding implies the presence of industry effects on dividend policy decisions. In general, the same factors that are important to Nasdaq firms are also important to NYSE firms. Copyright 2001 by MIT Press.
"Survey evidence such as Baker and Powell (1999), Baker et al. (2001), and Brav et al. (2005) support Lintner's (1956) findings. This evidence confirms that managers believe dividends should be related to permanent rather than temporary increases in profits. "
"Baker et al. (1985) and Baker and Powell (2000) find that the most important factors influencing dividend policy by corporations listed on the New York Stock Exchange ( NYSE) are the level of current and expected future earnings and the pattern or continuity of past dividends. Baker et al. (2001) report similar results for NASDAQ firms. "
"It is often argued that the share prices of a firm tend to be reduced whenever there is a reduction in the dividend payments With the view of examining weather the dividend policy is impact on shareholders wealth' in Sri Lankan stock market STATEMENT OF THE PROBLEM There is considerable debate on how dividend policy affects shareholders wealth. Some researchers believe that dividends increase shareholders wealth' (DeAngelo and DeAngelo, (2006) others believe that dividends are irrelevant (Miller and Seholes 1978) and still others believe that dividend decrease share holders wealth (Baker et al, 2001) "
[Show abstract][Hide abstract] ABSTRACT: The impact of firm’s dividend policy on shareholders’ wealth is an unresolved issue and has been subjected to many empirical discussions within the finance literatures. The objective of the firm is to increase the wealth of its stockholders. The best dividend policy is the one that increases shareholders wealth by the greatest amount. It is therefore necessary, to understand the nature of the relationship between dividend and value of the firm. To the knowledge of the researchers very few studies have attempted to observe the impact of dividend policy on shareholders’ wealth in Sri Lanka. In attempt to fill this research gap the present study was initiated to find out the impact of dividend policy on shareholders’ wealth from listed companies in the CSE in Sri Lanka during the period from 2005/2006 to 2010/2011. Primary information and secondary data were collected from Colombo Stock Exchange (CSE). The present study used the Person’s Product Movement Correlation and descriptive statistics to evaluate the data collected from the twenty companies listed in the CSE. In addition the dividend policy has insignificant impact on share price of the CSE. Outcomes of the study will be useful to the academicians, practitioners, policy makers and investors for making suitable policy formulations for the companies. Further the companies are able to decide a suitable polices in executing their financial decision without harming to the market value of the shares.
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