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dc.contributor.authorMazouz, K.
dc.contributor.authorWu, Yuliang
dc.contributor.authorEbrahim, R.
dc.contributor.authorSharma, A.
dc.date.accessioned2022-10-06T11:44:23Z
dc.date.accessioned2022-10-24T14:56:25Z
dc.date.available2022-10-06T11:44:23Z
dc.date.available2022-10-24T14:56:25Z
dc.date.issued2022
dc.identifier.citationMazouz K, Wu Y, Ebrahim R et al (2022) Dividend policy, systematic liquidity risk, and the cost of equity capital. Review of Quantitative Finance and Accounting. Accepted for publication.en_US
dc.identifier.urihttp://hdl.handle.net/10454/19183
dc.descriptionYesen_US
dc.description.abstractThis paper examines a new channel through which dividend policy can affect firm value. We find that firms that pay dividends exhibit lower systematic liquidity risk than those that do not. We also report a significant negative relationship between dividend payment and systematic liquidity risk. The liquidity improvement associated with dividend payments translates into an economically meaningful reduction in the cost of equity capital. Our results are robust to endogeneity concerns, to alternative measures of liquidity risk and dividend payouts, and to alternative model specifications. Further analysis suggests that the reduction in liquidity risk associated with dividend payouts is more pronounced for weakly governed firms and firms with opaque informational environment. Finally, we find that the recent financial crisis led to a greater increase in systematic liquidity risk for firms with no or low dividend payouts. Overall, our study implies that dividend policy can be used by corporate managers to shape liquidity risk and mitigate the adverse impact of economic downturns on the value of their firms.en_US
dc.language.isoenen_US
dc.publisherSpinger
dc.relation.isreferencedbyhttps://doi.org/10.1007/s11156-022-01114-3en_US
dc.rights© 2022 Springer. Reproduced in accordance with the publisher's self-archiving policy. The final publication is available at Springer via https://doi.org/10.1007/s11156-022-01114-3.en_US
dc.subjectDividend policyen_US
dc.subjectSystematic liquidity risken_US
dc.subjectCost of equity capitalen_US
dc.subjectFirm valueen_US
dc.titleDividend policy, systematic liquidity risk, and the cost of equity capitalen_US
dc.status.refereedYesen_US
dc.date.Accepted2022-10-01
dc.date.application2022-11-22
dc.typeArticleen_US
dc.date.EndofEmbargo2023-11-18
dc.type.versionAccepted manuscripten_US
dc.description.publicnotesThe full-text of this article will be released for public view at the end of the publisher embargo on 18th Nov 2023.
dc.rights.licenseUnspecifieden_US
dc.date.updated2022-10-06T11:44:25Z
refterms.dateFOA2022-10-24T14:56:55Z
dc.openaccess.statusembargoedAccessen_US


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