The Inter-relationships among Dividend Payout, Managers' Ownership, Financial Leverage, Agency Cost, and Firm-specific Characteristics-An Empirical Study on TSE

Via the use of multiple regression analysis, this paper has explored firms' dividend policy by examining the inter-relationships among managers' diversification loss, earning volatility, new incremental investment, flotation cost, leverage, and size effect. The empirical findings indicate that managers' diversification loss is negatively related with holding percentage and dividend payout ratios, while firms' sales volatility is positively related with holding percentage. In addition, flotation cost is positively related with indebtedness, but negatively related with dividend payout ratios. Furthermore, new incremental investment and firm size are not significantly correlated with dividend payout policy. Basically, the empirical findings are consistent with those observed in earlier studies and support Jensen arid Meckling agency hypothesis.