الملخص الإنجليزي
Abstract :
Dividend policy has been a major topic in many of the research papers throughout the years. Setting up the firm’s dividend policy is considered one of the most critical strategic decisions that can impact the firm in both the short run and the long run, due to its consequences on the firm’s capital structure, leverage, value, and other important aspects from the perspective of current and potential shareholders alike; the dividend represents the reward that they receive in exchange for their investment in the firm and involves accepting any risks associated with their investment.
The objective of this study is to investigate the existence of dividend policy persistence after the initial public offering (IPO) date for listed non-financial firms located in the Gulf Cooperation Council (GCC) countries from 2000 to 2019, based on a sample of firms that had an IPO date between 2000 and 2016. Additionally, the study investigates dividend policy persistence after IPO date across GCC countries and various industries. The study also examines the effect of firm heterogeneity on the persistence of dividend policy after the IPO date. Two firm characteristics that are being considered for the analysis of this effect namely, firm size and firm profitability. Finally, with respect to the international economic conditions, the study examines their effect on the persistence of dividends per share after IPO date during the periods of the financial crisis and the fall in oil price.
The study sample size consisted of 256 non-financial firms listed in the GCC countries, which have been chosen based on the availability of data. The study imported the firm data using the Thomson Reuters Data stream. A random regression model has been applied based on the outcome of the Hausman test.
The study’s selected variables were based on a critical review of previous studies that identified them as significant factors that impact a particular firm’s dividend policy.
The result of the study provides strong evidence of the existence of dividend policy persistence after the IPO date for public non-financial GCC firms. The study result has been supported by the outcomes of various analyses that have been conducted to verify the robustness of the study results. Specifically, the study has utilized other period windows, lagged the variables, changed the regression dependent variable to dividend pay-out ratio, changed the regression dependent variable to dividend decision, and taking the first differences of the independent variables analysis as robustness checks.
At the country-level, the findings show that public non-financial firms located in all of the GCC countries tend to maintain their dividend policy after the IPO date, which shows a strong validation for the study’s main outcome discussed above. As for industry level, the study found that firms within the manufacturing, accommodation and food services, construction, information, retail trade, and utilities industries tend to maintain their dividend policy after the IPO date. When it comes to the effect of firm’s heterogeneity, the study results show that large firms as well as higher profitability firms tend to have a more persistent dividend policy after the IPO date. As for the effect of the financial crisis period and period of the fall in oil price as an international economic condition, the study found that the dividend policy of public non financial firms in the GCC region was persistence during both of these periods.
Keywords : Initial public offering; persistence of dividend policy; dividend policy; GCC countries; international economic conditions; financial crisis; oil prices.
