Evidence of dividend catering theory in Malaysia: Implications for investor sentiment

Mamunur Rashid, Fauzias Mat Nor, Izani Ibrahim

    Research output: Contribution to journalArticle

    2 Citations (Scopus)

    Abstract

    This study investigates the key determinants of corporate performance in Malaysia. Using panel data (2002-2007) of 361 companies listed in Malaysia, the study finds dividend per share, use of debt, number of board members, and last year's performance to be the most significant determinants of corporate performance across four selected industries: trading or services, property, consumer products, and industrial products. This study also finds that dividend per share is influenced by market performance and is followed by last year's dividend and size of the dividend. These findings exhibit the presence of dividend catering incentives. As such, market demand for dividends drives corporate dividends. The study concludes that investor sentiment influences corporate decisions in Malaysia.

    Original languageEnglish
    Pages (from-to)99-110
    Number of pages12
    JournalContemporary Economics
    Volume7
    Issue number4
    DOIs
    Publication statusPublished - 2013

    Fingerprint

    Dividends
    Malaysia
    Investor sentiment
    Corporate performance
    Debt
    Incentives
    Listed companies
    Market performance
    Consumer products
    Industry
    Panel data
    Market demand

    Keywords

    • Dividend catering theory
    • Investor sentiment
    • Malaysia

    ASJC Scopus subject areas

    • Economics, Econometrics and Finance(all)

    Cite this

    Evidence of dividend catering theory in Malaysia : Implications for investor sentiment. / Rashid, Mamunur; Nor, Fauzias Mat; Ibrahim, Izani.

    In: Contemporary Economics, Vol. 7, No. 4, 2013, p. 99-110.

    Research output: Contribution to journalArticle

    Rashid, Mamunur ; Nor, Fauzias Mat ; Ibrahim, Izani. / Evidence of dividend catering theory in Malaysia : Implications for investor sentiment. In: Contemporary Economics. 2013 ; Vol. 7, No. 4. pp. 99-110.
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