Open AccessMarket power and dividend policy: Evidence from firms listed in Tehran stock exchange
Author(s) -
M Ramezani,
Seyed Alireza Moosavi
Publication year - 2015
Publication title -
environment conservation journal/environment conservation journal
Language(s) - English
Resource type - Journals
eISSN - 2278-5124
pISSN - 0972-3099
DOI - 10.36953/ecj.2015.se1602
Subject(s) - dividend policy , stock exchange , dividend , business , panel data , shareholder , stock market , monetary economics , financial economics , market power , economics , finance , corporate governance , market economy , econometrics , paleontology , horse , biology , monopoly
Dividend policy informs shareholders and investors how the financial situation of the firm is. Therefore, in situations where risk is always the determining factor for dividend policy, the company with the market power, can affect major changes in social, economic, and political events or have more successful responds toward them, and thus, is less exposed to systematic risk. Therefore, market power helps the firm to preserve firm-specific shocks from its product market or to reduce the information uncertainty that the investors of the firm face it. Hence, this study attempts to investigate the impact of product market pricing power on the firm's dividend policy. For this purpose, the data from 122 firms listed in Tehran Stock Exchange during 2009 to 2013 and Panel data model were used. The results showed that there is a reveres significant relationship between firm’s market power and the amount of dividend policy of listed firms in Tehran Stock Exchange.