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Int. J. Financial Stud. 2018, 6(4), 93; https://doi.org/10.3390/ijfs6040093

Determinants of Dividend Payout Decisions: A Dynamic Panel Data Analysis of Turkish Stock Market

1
Isiklar Holding A.S., Tandogan, Ankara 06580, Turkey
2
Investor Compensation Center, Capital Markets Board of Turkey, Ankara 06530, Turkey
3
Department of Management, Ankara University, Ankara 06590, Turkey
*
Author to whom correspondence should be addressed.
Received: 29 August 2018 / Revised: 3 November 2018 / Accepted: 14 November 2018 / Published: 20 November 2018
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PDF [288 KB, uploaded 20 November 2018]

Abstract

This study analyzes the firm-specific factors affecting the dividend payout decisions of the companies whose shares are traded on the Borsa Istanbul stock exchange. To this end, the dynamic panel regression is applied to 853 observations of yearly average of 106 companies listed on the Borsa Istanbul between 2009 and 2015. According to results from the Arellano–Bover/Blunder-Bond two-step system generalized method of moments, a statistically significant positive effect on dividend payout was found in the relationship between the dividend payout of the previous year, the company’s return on equity and the market value/book value ratio, liquidity and the company’s size. The demonstration of a positive relationship between dividend payout and return on equity supports the free cash flow hypothesis and the positive relationship with the previous year’s dividend payout ratio supports the dividend smoothing hypothesis for Turkey. View Full-Text
Keywords: dividend; free cash flow hypothesis; dividend smoothing hypothesis; dividend irrelevance hypothesis; dynamic panel; Borsa Istanbul dividend; free cash flow hypothesis; dividend smoothing hypothesis; dividend irrelevance hypothesis; dynamic panel; Borsa Istanbul
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).
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MDPI and ACS Style

Bostanci, F.; Kadioglu, E.; Sayilgan, G. Determinants of Dividend Payout Decisions: A Dynamic Panel Data Analysis of Turkish Stock Market. Int. J. Financial Stud. 2018, 6, 93.

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Int. J. Financial Stud. EISSN 2227-7072 Published by MDPI AG, Basel, Switzerland RSS E-Mail Table of Contents Alert
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