Historic income versus inflation-adjusted income in the dividend decision
An attempt is made to determine to what extent companies take into account the effects of inflation in formulating their dividend decisions. The research design incorporates a two-stage regression approach which permits a determination of the incremental explanatory power of collinear variables. The...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
AOSIS
1986-09-01
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| Series: | South African Journal of Business Management |
| Online Access: | https://sajbm.org/index.php/sajbm/article/view/1044 |
| _version_ | 1817983427371073536 |
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| author | D. P. Du Plessis A. A. Archer J. F. Affleck-Graves |
| author_facet | D. P. Du Plessis A. A. Archer J. F. Affleck-Graves |
| author_sort | D. P. Du Plessis |
| collection | DOAJ |
| description | An attempt is made to determine to what extent companies take into account the effects of inflation in formulating their dividend decisions. The research design incorporates a two-stage regression approach which permits a determination of the incremental explanatory power of collinear variables. The research findings suggest that dividend decisions are best explained in terms of historic earnings. It therefore appears as if management does not take the effects of inflation into account in formulating dividend policy. This could have serious implications for the survival of a company because it could result in a real dividend cover of less than one. |
| first_indexed | 2024-04-13T23:33:01Z |
| format | Article |
| id | doaj.art-fd3c4b74c77a4e0d8f5ca390e51a5d5d |
| institution | Directory Open Access Journal |
| issn | 2078-5585 2078-5976 |
| language | English |
| last_indexed | 2024-04-13T23:33:01Z |
| publishDate | 1986-09-01 |
| publisher | AOSIS |
| record_format | Article |
| series | South African Journal of Business Management |
| spelling | doaj.art-fd3c4b74c77a4e0d8f5ca390e51a5d5d2022-12-22T02:24:50ZengAOSISSouth African Journal of Business Management2078-55852078-59761986-09-0117311912410.4102/sajbm.v17i3.1044761Historic income versus inflation-adjusted income in the dividend decisionD. P. Du Plessis0A. A. Archer1J. F. Affleck-Graves2Sanlam InvestmentsUniversity of Stellenbosch Business SchoolGraduate School of Business, University of Cape TownAn attempt is made to determine to what extent companies take into account the effects of inflation in formulating their dividend decisions. The research design incorporates a two-stage regression approach which permits a determination of the incremental explanatory power of collinear variables. The research findings suggest that dividend decisions are best explained in terms of historic earnings. It therefore appears as if management does not take the effects of inflation into account in formulating dividend policy. This could have serious implications for the survival of a company because it could result in a real dividend cover of less than one.https://sajbm.org/index.php/sajbm/article/view/1044 |
| spellingShingle | D. P. Du Plessis A. A. Archer J. F. Affleck-Graves Historic income versus inflation-adjusted income in the dividend decision South African Journal of Business Management |
| title | Historic income versus inflation-adjusted income in the dividend decision |
| title_full | Historic income versus inflation-adjusted income in the dividend decision |
| title_fullStr | Historic income versus inflation-adjusted income in the dividend decision |
| title_full_unstemmed | Historic income versus inflation-adjusted income in the dividend decision |
| title_short | Historic income versus inflation-adjusted income in the dividend decision |
| title_sort | historic income versus inflation adjusted income in the dividend decision |
| url | https://sajbm.org/index.php/sajbm/article/view/1044 |
| work_keys_str_mv | AT dpduplessis historicincomeversusinflationadjustedincomeinthedividenddecision AT aaarcher historicincomeversusinflationadjustedincomeinthedividenddecision AT jfaffleckgraves historicincomeversusinflationadjustedincomeinthedividenddecision |