Ownership structure and dividend policy: application of Lintner's dividend model in Sri Lanka Online publication date: Fri, 17-Nov-2017
by K.M.K.N.S. Kulathunga; A.A. Azeez
International Journal of Accounting and Finance (IJAF), Vol. 7, No. 3, 2017
Abstract: This paper investigates the effect of ownership structure on the dividend policy of 77 Sri Lankan firms listed in the Colombo Stock Exchange over the period 2006-2014. The Lintner's full adjustment model and the partial adjustment model are used to examine the potential relationship between ownership structure and the dividend policy. We find that the ownership identity matters in determining the dividends according to Lintner's dividend model in Sri Lanka. Compared to the full adjustment model, the partial adjustment model is superior in explaining the variation in dividends with variables associated in different ownership structures. There is a negative association between institutional, managerial ownership structures and the dividend policy and a significant positive association between concentrated ownership structure and the dividend policy. In addition, the dividend in the preceding year is highly significant in explaining the succeeding year's dividend, thus confirming the stability of the dividend policy.
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Accounting and Finance (IJAF):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email subs@inderscience.com
Our Blog 
Follow us on Twitter 
Visit us on Facebook