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Dividend Policy As A Signaling Mechanism Under Different Market Conditions: Evidence From The Casablanca Stock Exchange, Omar Farooq, Siham Saoud, Samir Agnaou
Dividend Policy As A Signaling Mechanism Under Different Market Conditions: Evidence From The Casablanca Stock Exchange, Omar Farooq, Siham Saoud, Samir Agnaou
Omar Farooq
Does the signaling value of dividend policy depend on market conditions? Do investors respond to dividend policy differently in different periods? This study answers these questions by using a sample of firms from the Casablanca Stock Exchange during the period between 2003 and 2007. We find a significantly negative relationship between dividend payout ratio and stock price volatility during the stable growth period. We also show a significantly positive relationship between dividend payout ratio and stock returns during the same period. However, this relationship turns insignificant during the high growth period. One of the reasons for our results may be …
Effect Of Corporate Governance Mechanisms On The Relationship Between Legal Origins And Cost Of Debt: Evidence From The Middle East And North Africa (Mena) Region, Omar Farooq, Mohamed Derrabi
Effect Of Corporate Governance Mechanisms On The Relationship Between Legal Origins And Cost Of Debt: Evidence From The Middle East And North Africa (Mena) Region, Omar Farooq, Mohamed Derrabi
Omar Farooq
How do differences in country-level governance and enforcement mechanisms affect firms? Using a large dataset from the MENA region, we document that differences in legal traditions translate into differences in cost of debt. Our results show that firms headquartered in the common law countries have lower cost of debt than firms headquartered in the civil law countries. Our results also show that bulk of the difference in cost of debt between firms headquartered across the two legal regimes can be explained by the corporate governance mechanisms. Our results have implication for firms in the civil law countries in a way …