IDEAS home Printed from https://ideas.repec.org/a/rfh/bbejor/v4y2015i4p223-231.html
   My bibliography  Save this article

Empirical Examination of the Determinants of Dividend Payout of Quoted Agro based Firms in Nigeria

Author

Listed:
  • Bassey Nsikan Edet

    (Akwa Ibom StateUniversity, Ikot Akpaden, Mkpat Enin, Akwa Ibom State, Nigeria)

  • Ikpe Imoh Kingsley

    (Akwa Ibom StateUniversity, Ikot Akpaden, Mkpat Enin, Akwa Ibom State, Nigeria)

  • Edet, Mfon Efiong

    (Department of Agricultural Economics and Extension, University of Calabar, Cross River State, Nigeria)

Abstract

This study examines the factors affecting dividend payout of quoted agro-based firms in Nigeria. Data sourced from a sample of 15 agro-based firms for the period 2007-2013 were analyzed using the modified Litner’s model base on Ordinary Least Squares (OLS). Data were first examined for stationarity using the Augmented Dickey Fuller (ADF) test. Result revealed that all the variables were stationary at levels except leverage, liquidity and retained earnings that were stationary at first difference. The OLS result showed that previous dividend, profitability and firm size exerted significant positive influence on dividend payout while firm leverage and business risk exerted significant negative influence on dividend payout. Surprisingly, firm liquidity, Taxes and Retained Earnings failed to explain the variation in dividend payout of these firms. This, therefore, suggest the need to pursue policies that would minimize investment in risky projects, foster dividend payment through the reduction in retained earnings and enhancing firm’s profitability through tax reduction, exemption and rebate as well as discouraging excessive leverage as the way out.

Suggested Citation

  • Bassey Nsikan Edet & Ikpe Imoh Kingsley & Edet, Mfon Efiong, 2015. "Empirical Examination of the Determinants of Dividend Payout of Quoted Agro based Firms in Nigeria," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 4(4), pages 223-231, December.
    • Handle: RePEc:rfh:bbejor:v:4:y:2015:i:4:p:223-231
    as

    Download full text from publisher

    File URL: https://bbejournal.com/index.php/BBE/article/view/240/194
    Download Restriction: no
    File URL: https://bbejournal.com/index.php/BBE/article/view/240
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Agro-based firms; Dividend payout and liquidity;

    JEL classification:

    • N5 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rfh:bbejor:v:4:y:2015:i:4:p:223-231. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Muhammad Irfan Chani (email available below). General contact details of provider: https://edirc.repec.org/data/rffhlpk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.