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Determinants of corporate dividend policy in Greece


  • Theophano Patra
  • Sunil Poshakwale
  • Kean Ow-Yong


This article examines the determinants of corporate dividend policy of listed firms in Greece as a case study of an emerging market country. The analysis is based on 945 firm year observations of 63 nonfinancial firms which paid dividends annually from 1993 to 2007. The study uses the Generalized Method of Moments (GMM) to estimate the firm level factors that may determine why firms distribute dividends. We find that size, profitability and liquidity factors increase the probability to pay dividends. However, investment opportunities, financial leverage and business risk decrease the likelihood to pay dividends. On the whole, the findings lend support for the information asymmetry and agency cost theories. In addition, the factors that influence dividend policy in developed markets also appear to apply for this emerging market country.

Suggested Citation

  • Theophano Patra & Sunil Poshakwale & Kean Ow-Yong, 2012. "Determinants of corporate dividend policy in Greece," Applied Financial Economics, Taylor & Francis Journals, vol. 22(13), pages 1079-1087, July.
  • Handle: RePEc:taf:apfiec:v:22:y:2012:i:13:p:1079-1087 DOI: 10.1080/09603107.2011.639734

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    References listed on IDEAS

    1. Salvador Barrios & Sven Langedijk & Lucio Pench, 2010. "EU fiscal consolidation after the financial crisis. Lessons from past experiences," European Economy - Economic Papers 2008 - 2015 418, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    2. António Afonso, 2010. "Expansionary fiscal consolidations in Europe: new evidence," Applied Economics Letters, Taylor & Francis Journals, vol. 17(2), pages 105-109, January.
    3. Heylen, Freddy & Everaert, Gerdie, 2000. "Success and Failure of Fiscal Consolidation in the OECD: A Multivariate Analysis," Public Choice, Springer, vol. 105(1-2), pages 103-124, October.
    4. António Afonso & Christiane Nickel & Philipp C. Rother, 2006. "Fiscal Consolidations in the Central and Eastern European Countries," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(2), pages 402-421, July.
    5. Giudice, Gabriele & Turrini, Alessandro Antonio & Veld, Jan in't, 2004. "Non-Keynesian Fiscal Consolidation in the EU? Ex Post Evidence and Ex Ante Analysis," CEPR Discussion Papers 4388, C.E.P.R. Discussion Papers.
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    Cited by:

    1. Amjad Hassonn & Huy Tran & Hao Quach, 2016. "The Determinants of Corporate Dividend Policy: Evidence from Palestine," Journal of Finance and Investment Analysis, SCIENPRESS Ltd, vol. 5(4), pages 1-2.

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