THE DETERMINANTS OF DIVIDEND POLICY – AN EMPIRICAL STUDY
THE DETERMINANTS OF DIVIDEND POLICY – AN EMPIRICAL STUDY

Summary/Abstract: The variables that determine the dividend policy of a company have been the subject of broad research for the past six decades. The present article re-examines various factors that might have an impact on the dividend decision of a company. Framework based on theories on corporate dividends existing in literature is expanded to observe the determinants of dividend yield. The analysis made on panel data estimations on dividend paying companies included in the BET and BETPlus indexes, follows the evolution of Romanian companies listed on Bucharest Stock Exchange regulated market, on a period of three years. The explanatory variables adopted in this study are: profitability, liquidity, size, leverage, growth and experience. Multiple regression is conducted on the prominent factors. The result of this study can be useful for investors when deciding where to put their money, based on dividend yields for BET and BETPlus Index companies, and to forecast dividend yields using their significant determinants.

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