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Dividend policy of Indonesian listed firms: The role of families and the state

Duygun, Meryem; Guney, Yilmaz; Moin, Abdul

Authors

Meryem Duygun

Abdul Moin



Abstract

We investigate factors influencing the dividend policy of the listed Indonesian firms by focusing on agency costs and ownership structure. Our study finds that firms with higher conflicts of interest among managers and shareholders pay lower dividends. In the context of the conflicts of interest among major and minor shareholders, we find that such conflicts would exert little impact on dividend payments. Further, we find that the family-controlled firms prefer to pay less dividends whereas the corporations with higher state ownership are associated with larger dividend payments. Our findings are in line with the argument that the Indonesian state consider corporate dividends as one of the main sources of revenues other than corporate taxes in their government budget. This issue may have adverse effects on the growth of cash-constrained small and medium-sized enterprises.

Journal Article Type Article
Publication Date 2018-11
Journal Economic Modelling
Print ISSN 0264-9993
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 75
Pages 336-354
Institution Citation Duygun, M., Guney, Y., & Moin, A. (2018). Dividend policy of Indonesian listed firms: The role of families and the state. Economic modelling, 75, 336-354. https://doi.org/10.1016/j.econmod.2018.07.007
DOI https://doi.org/10.1016/j.econmod.2018.07.007
Keywords Dividends; Ownership structure; Agency conflicts; Indonesia
Publisher URL https://www.sciencedirect.com/science/article/pii/S0264999317315286?via%3Dihub
Copyright Statement © 2018. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/

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Copyright Statement
© 2018. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/







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