An empirical investigation of corporate dividend pay-out behaviour in an emerging market

Research output: Contribution to journalArticle

11 Citations (Scopus)

Abstract

The Lintner model of aggregate corporate dividend pay-out behaviour is applied to firms in the private sector in a developing country, India. The findings are that an augmented Lintner model which includes external finance as an explanatory variable explains aggregate dividends better. Possible reasons for this finding are discussed both in the context of India and developing countries in general. Finally, the paper tests to see whether dividend pay-out behaviour can be characterized as rational. While it appears that dividend pay-out behaviour is not rational, which is contrary to recent evidence from the US and Japan, a deeper understanding of the institutional environment in which firms operate suggests that when viewed in that context the observed irrationality may indeed be rational.

Original languageEnglish (US)
Pages (from-to)243-246
Number of pages4
JournalApplied Financial Economics
Volume2
Issue number4
DOIs
StatePublished - Dec 1 1992

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Empirical investigation
Emerging markets
Dividend payout
Developing countries
India
Irrationality
External finance
Institutional environment
Japan
Dividends
Private sector

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Finance

Cite this

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An empirical investigation of corporate dividend pay-out behaviour in an emerging market. / Mookerjee, Rajen.

In: Applied Financial Economics, Vol. 2, No. 4, 01.12.1992, p. 243-246.

Research output: Contribution to journalArticle

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