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Determinants of dividend policy: empirical evidence from Nigerian listed firms.

Alaeto, Henry Emeka


Henry Emeka Alaeto



The aim of this research thesis is to contribute to already extensive corporate finance literature in the context of the Nigerian market by examining the determinants of dividend payouts by non-financial firms listed on the Nigerian Stock Exchange (NSE). Accordingly, two proxies for dividend policy were used: dividend intensity and the dividend payout ratio. Also, six explanatory variables - return of assets, size, debt ratio, growth opportunities, liquidity ratio and tangibility of assets - were selected, based on the theoretical predictions and empirical findings from the literature reviewed, in order to explain the determinants of dividend payouts of non-financial firms in Nigeria. This study used a quantitative method design based on a positivist paradigm to draw its conclusions. Secondary data from the annual accounts of 74 non-financial companies listed on the NSE, for a five-year period from 2013 to 2017, were manually collected from companies' official websites, while market data was obtained from the Nigerian Stock Exchange. Thereafter, pooled OLS models were employed in analysis and testing of the research hypotheses formulated. The findings of this study indicate that dividend payouts were positively correlated to profitability, growth opportunities and liquidity, whereas size, debt ratio, and asset tangibility were all found to be negatively correlated to dividend payouts. Further proof reveals that time and industry effects do not impact much on the dividend payouts of Nigerian firms. Finally, this present study makes a significant contribution to both academia and practice. First, it provides a basis for future research, as it appears to be the first study in Nigeria to cover all sectors using up-to-date accounting and market data to investigate empirically the determinants of dividend payouts of non-financial firms listed on the Nigerian Stock Exchange. Secondly, this research was designed to advance knowledge of corporate finance in order to provide further evidence on the determinants of dividend payouts of such firms to facilitate comparison with other similar studies in emerging markets. Finally, it assists firms in understanding the dynamics of the Nigerian market, especially the institutional environment including the financial, legal and political system, with a view to making more informed decisions about the determinants of corporate dividend policy decisions.


ALAETO, H.E. 2020. Determinants of dividend policy: empirical evidence from Nigerian listed firms. Robert Gordon University, MRes thesis. Hosted on OpenAIR [online]. Available from:

Thesis Type Thesis
Deposit Date Mar 8, 2021
Publicly Available Date Mar 8, 2021
Keywords Dividends; Dividend payouts; Dividend determinants; Emerging markets; Nigerian Stock Exchange
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