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Dividend smoothing when firms distribute most of their earnings as dividends

Journal Article


Abstract


  • Due to its distinctive institutional background, Oman offers a valuable opportunity to investigate the stability of the dividend policy. In Oman, (1) there are no taxes on dividends, (2) firms are highly levered mainly through bank loans, (3) there is a high concentration of stock ownership and (4) there is variability in cash dividend payments. These factors suggest a diminished role of dividend smoothing in Oman. Our results show that Omani financial firms have erratic dividend policies. These results are inconsistent with the predictions suggested by the relatively weak corporate governance, government ownership and dividend signalling.

Authors


  •   Al-Yahyaee, Khamis (external author)
  •   Pham, Toan (external author)
  •   Walter, Terry S.

Publication Date


  • 2011

Citation


  • Al-Yahyaee, K. H., Pham, T. M. & Walter, T. S. (2011). Dividend smoothing when firms distribute most of their earnings as dividends. Applied Financial Economics, 21 (16), 1175-1183.

Scopus Eid


  • 2-s2.0-79960885984

Ro Metadata Url


  • http://ro.uow.edu.au/buspapers/1190

Number Of Pages


  • 8

Start Page


  • 1175

End Page


  • 1183

Volume


  • 21

Issue


  • 16

Abstract


  • Due to its distinctive institutional background, Oman offers a valuable opportunity to investigate the stability of the dividend policy. In Oman, (1) there are no taxes on dividends, (2) firms are highly levered mainly through bank loans, (3) there is a high concentration of stock ownership and (4) there is variability in cash dividend payments. These factors suggest a diminished role of dividend smoothing in Oman. Our results show that Omani financial firms have erratic dividend policies. These results are inconsistent with the predictions suggested by the relatively weak corporate governance, government ownership and dividend signalling.

Authors


  •   Al-Yahyaee, Khamis (external author)
  •   Pham, Toan (external author)
  •   Walter, Terry S.

Publication Date


  • 2011

Citation


  • Al-Yahyaee, K. H., Pham, T. M. & Walter, T. S. (2011). Dividend smoothing when firms distribute most of their earnings as dividends. Applied Financial Economics, 21 (16), 1175-1183.

Scopus Eid


  • 2-s2.0-79960885984

Ro Metadata Url


  • http://ro.uow.edu.au/buspapers/1190

Number Of Pages


  • 8

Start Page


  • 1175

End Page


  • 1183

Volume


  • 21

Issue


  • 16