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Dividend behaviour: different market segmentations

This research explores the dynamics of dividend behaviour of Lintner’s model in three distinct regimes with three different market segmenta-tions, namely Singapore, Malaysia, and Saudi Arabia. In particular, Singapore, Malaysia, and Saudi Arabia each have some interesting features th...

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Main Authors: Shafai, Nor Anis, Abdul Rahim, Norhuda, Bulot, Norhisam, Md. Nassir, Annuar, Kamarudin, Fakarudin
Format: Article
Language:English
Published: Faculty of Applied Sciences of WSB University 2021
Online Access:http://psasir.upm.edu.my/id/eprint/96771/1/ABSTRACT.pdf
http://psasir.upm.edu.my/id/eprint/96771/
https://ojs.wsb.edu.pl/index.php/fso/article/view/347/263
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spelling my.upm.eprints.967712022-12-01T07:32:32Z http://psasir.upm.edu.my/id/eprint/96771/ Dividend behaviour: different market segmentations Shafai, Nor Anis Abdul Rahim, Norhuda Bulot, Norhisam Md. Nassir, Annuar Kamarudin, Fakarudin This research explores the dynamics of dividend behaviour of Lintner’s model in three distinct regimes with three different market segmenta-tions, namely Singapore, Malaysia, and Saudi Arabia. In particular, Singapore, Malaysia, and Saudi Arabia each have some interesting features that make this study suitable for policy recommendations to other Asian countries and countries in other parts of the world, espe-cially in the same market segmentation. Therefore, it will be intriguing to see if these three countries adopt stable cash dividend policies, whether they smooth out dividends, and to determine the speed of adjustment of dividends towards a long-run target payout ratio. The study used the top 100 listed firms in each country using the Gener-alised Method of Moments (GMM) for the period of 2007 to 2016. The results clearly demonstrate that Saudi Arabian firms have the smooth-est and most stable dividend payout, followed by Malaysia which has a moderate speed of adjustment suggesting fairly stable dividends arising from a positive change in earnings, while Singapore has a sig-nificantly high speed of adjustment indicating no smoothing. Based on these findings, Saudi Arabian firms practise smoothing and have stable dividends. Although a great deal of research has been done us-ing a partial adjustment model, no evidence has been provided on the three different markets. Most of the research focused on developed markets rather than emerging ones. This could therefore contribute to the different legal and statutory systems that exist in these countries. The difference hinders the overall view of the results obtained from the three markets. Faculty of Applied Sciences of WSB University 2021 Article PeerReviewed text en http://psasir.upm.edu.my/id/eprint/96771/1/ABSTRACT.pdf Shafai, Nor Anis and Abdul Rahim, Norhuda and Bulot, Norhisam and Md. Nassir, Annuar and Kamarudin, Fakarudin (2021) Dividend behaviour: different market segmentations. Forum Scientiae Oeconomia, 9 (1). 91 - 103. ISSN 2300-5947 https://ojs.wsb.edu.pl/index.php/fso/article/view/347/263 10.23762/fso_vol9_ no1_6
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
language English
description This research explores the dynamics of dividend behaviour of Lintner’s model in three distinct regimes with three different market segmenta-tions, namely Singapore, Malaysia, and Saudi Arabia. In particular, Singapore, Malaysia, and Saudi Arabia each have some interesting features that make this study suitable for policy recommendations to other Asian countries and countries in other parts of the world, espe-cially in the same market segmentation. Therefore, it will be intriguing to see if these three countries adopt stable cash dividend policies, whether they smooth out dividends, and to determine the speed of adjustment of dividends towards a long-run target payout ratio. The study used the top 100 listed firms in each country using the Gener-alised Method of Moments (GMM) for the period of 2007 to 2016. The results clearly demonstrate that Saudi Arabian firms have the smooth-est and most stable dividend payout, followed by Malaysia which has a moderate speed of adjustment suggesting fairly stable dividends arising from a positive change in earnings, while Singapore has a sig-nificantly high speed of adjustment indicating no smoothing. Based on these findings, Saudi Arabian firms practise smoothing and have stable dividends. Although a great deal of research has been done us-ing a partial adjustment model, no evidence has been provided on the three different markets. Most of the research focused on developed markets rather than emerging ones. This could therefore contribute to the different legal and statutory systems that exist in these countries. The difference hinders the overall view of the results obtained from the three markets.
format Article
author Shafai, Nor Anis
Abdul Rahim, Norhuda
Bulot, Norhisam
Md. Nassir, Annuar
Kamarudin, Fakarudin
spellingShingle Shafai, Nor Anis
Abdul Rahim, Norhuda
Bulot, Norhisam
Md. Nassir, Annuar
Kamarudin, Fakarudin
Dividend behaviour: different market segmentations
author_facet Shafai, Nor Anis
Abdul Rahim, Norhuda
Bulot, Norhisam
Md. Nassir, Annuar
Kamarudin, Fakarudin
author_sort Shafai, Nor Anis
title Dividend behaviour: different market segmentations
title_short Dividend behaviour: different market segmentations
title_full Dividend behaviour: different market segmentations
title_fullStr Dividend behaviour: different market segmentations
title_full_unstemmed Dividend behaviour: different market segmentations
title_sort dividend behaviour: different market segmentations
publisher Faculty of Applied Sciences of WSB University
publishDate 2021
url http://psasir.upm.edu.my/id/eprint/96771/1/ABSTRACT.pdf
http://psasir.upm.edu.my/id/eprint/96771/
https://ojs.wsb.edu.pl/index.php/fso/article/view/347/263
_version_ 1752147924178960384
score 13.211869

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