Title: Firm-specific characteristics' effect on cash holdings and dividends payout: evidence from simultaneous equation modelling

Authors: Isam Saleh; Malik Abu Afifa; Maha Ayoush; Fares Alsufy; Samer Abosabha; Nissrat Khoshnaw

Addresses: Accounting Department, Faculty of Business, Al-Zaytoonah University of Jordan, Amman, 11733, Jordan ' Accounting Department, Faculty of Business, Al-Zaytoonah University of Jordan, Amman, 11733, Jordan ' Accounting Department, Faculty of Business, Al-Zaytoonah University of Jordan, Amman, 11733, Jordan ' Accounting Department, Faculty of Business, Al-Isra University, Amman, 11622, Jordan ' Accounting Department, Faculty of Business, Al-Zaytoonah University of Jordan, Amman 11733, Jordan ' Accounting Department, College of Administration and Economics, Salahaddin University –Hawler, Arbil, 44004, Iraq

Abstract: This study aims to conduct a simultaneous investigation into firm-specific characteristics of cash holdings and dividends payout using panel data analysis. This study uses simultaneous modelling using the GMM regression model performed for non-financial firms listed on the Amman Stock Exchange (ASE) between 2012 and 2019, with 736 observations for each variable. The results show that the previous year's cash holdings, investment opportunities, profitability proxied by ROA and firm size positively and significantly affect the cash holdings, while the dividends payout and leverage are negative with a significant effect. Additionally, the findings of the second dynamic behaviour model show that for the previous year's dividends, the leverage and cash holdings negatively and significantly affect dividends payout. However, investment opportunities, ROA, and firm size positively and significantly affect dividends payout. Finally, scholars, investors, and other decision-makers can use these results to better understand the firm-specific characteristics of cash holdings and dividends payout.

Keywords: firm characteristics; cash holdings; dividends; simultaneous modelling; Jordanian market.

DOI: 10.1504/IJBIS.2026.154683

International Journal of Business Information Systems, 2026 Vol.52 No.3, pp.330 - 354

Received: 24 Apr 2022
Accepted: 23 Oct 2022
Published online: 10 Jul 2026 *

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