Product Market Competition and Dividend Payouts of Listed Non-Financial Firms in Nigeria

  •  Olufemi Obembe    
  •  Joy Imafidon    
  •  Abiodun Adegboye    


This study sought to examine the impact of product market competition on the dividend payout of non-financial firms listed on the Nigerian Stock Exchange. Data were collected on 76 non-financial firms for 11 years covering 1997–2007 and were analyzed using pooled OLS regression method with robust standard errors. Product market competition was measured by the reciprocal of market power. Our results showed that market power had a positive and significant impact on dividend payment suggesting that product market competition impact negatively on dividend payout of firms in Nigeria. Other factors that significantly and positively influenced dividend payment include profitability and size of firms while firms classified in the manufacturing sub-sector of the exchange paid significantly higher dividends than firms in the commercials and services’ sub-sectors. Finally firms that were financially constrained were found to pay significantly lower dividends compared with firms without financial constraints suggesting that Cash flow had a significant impact on dividend payout of firms in Nigeria.

This work is licensed under a Creative Commons Attribution 4.0 License.