Title: Factors that drive dividend payout decisions: an investigation in the context of Bangladesh

Authors: Afrin Rifat; Anika Bushra; Nabila Nisha

Addresses: Department of Accounting and Finance, School of Business and Economics, North South University, Bashundhara, 1229 Dhaka, Bangladesh ' Department of Finance, Johns Hopkins Carey Business School, 100 International Drive, Baltimore, MD 21202, USA ' Department of Accounting and Finance, School of Business and Economics, North South University, Bashundhara, 1229 Dhaka, Bangladesh

Abstract: Generally, dividend policies guide the financial rewards of the shareholders. It is often a challenging decision for companies to determine the appropriate level of dividend for the shareholders. While some past studies argue that microeconomic factors drive the decision of dividend policies, many other researchers claim that it is the macroeconomic factors of a country which ultimately influence the dividend payouts. However, there is a paucity of research in this area for emerging countries like Bangladesh. This study thus examines impacts of a set of pre-determined microeconomic and macroeconomic factors upon cash dividend payouts by analysing a sample of listed firms of the Dhaka Stock Exchange (DSE), Bangladesh. Findings are analysed based on liquidity, leverage, growth, and size of the sample firms for microeconomic factors; while, macroeconomic factors are analysed upon dividends on an average basis. The results provide policy implications for shareholders, management, policymakers and the government of Bangladesh.

Keywords: dividends; microeconomic variables; macroeconomic variables; profitability; company-specific; country-specific; emerging economy; Bangladesh.

DOI: 10.1504/AAJFA.2020.108246

Afro-Asian Journal of Finance and Accounting, 2020 Vol.10 No.3, pp.380 - 408

Received: 15 Jan 2018
Accepted: 01 Oct 2018
Published online: 07 Jul 2020 *

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