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11 – 20 of 33Joshua Abor and Godfred A. Bokpin
The purpose of this paper is to investigate the effects of investment opportunities and corporate finance on dividend payout policy.
Abstract
Purpose
The purpose of this paper is to investigate the effects of investment opportunities and corporate finance on dividend payout policy.
Design/methodology/approach
This issue is tested with a sample of 34 emerging market countries covering a 17‐year period, 1990‐2006. Fixed effects panel model is employed in our estimation.
Findings
A significantly negative relationship between investment opportunity set and dividend payout policy is found. There are, however, insignificant effects of the various measures of corporate finance namely, financial leverage, external financing, and debt maturity on dividend payout policy. Profitability and stock market capitalization are also identified as important in influencing dividend payout policy. Profitable firms are more likely to support high dividend payments to shareholders. However, firms in relatively well‐developed markets tend to exhibit low dividend payout policy.
Originality/value
The main value of the paper is in respect of the fact that it uses a large dataset from emerging market countries. The results generally support existing literature on investment opportunity set and dividend payout policy.
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Godfred A. Bokpin and Zangina Isshaq
The purpose of this paper is to examine the interaction between corporate disclosure and foreign share ownership on the Ghana Stock Exchange (GSE).
Abstract
Purpose
The purpose of this paper is to examine the interaction between corporate disclosure and foreign share ownership on the Ghana Stock Exchange (GSE).
Design/methodology/approach
The paper follows the trinary procedure of Aksu and Kosedag and uses the Standard & Poor's transparency and disclosure items in the construction of the disclosure index. Therefore, the paper adopts a panel data analysis covering a period from 2002 to 2007 using the seemingly unrelated regression approach.
Findings
The results indicate a statistically significant interaction between corporate disclosures and foreign share ownership among the sample firms. The market value of equity and market‐to‐book value ratio is documented; free cash flow and financial leverage have statistically significant relationships with foreign share ownership.
Originality/value
This is the first of its kind in the country that considers the impact of corporate governance and disclosure on foreign share ownership despite the numerous studies carried out on the GSE.
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Zangina Isshaq, Godfred A. Bokpin and Joseph Mensah Onumah
The purpose of this paper is to examine the interaction between corporate governance, ownership structure, cash holdings, and firm value on the Ghana Stock Exchange.
Abstract
Purpose
The purpose of this paper is to examine the interaction between corporate governance, ownership structure, cash holdings, and firm value on the Ghana Stock Exchange.
Design/methodology/approach
A multiple regression approach using the seemingly unrelated regression to mitigate the problems of multicollinearity between the cash‐holding variable and other control variables is adopted.
Findings
Board size is found to be positively and statistically significantly related to share price among the corporate governance variables. However, a significant relationship between inside ownership and share price is not found. The results also indicate that additional units of cash holdings do not have a statistically significant influence on share price. Finally, leverage and income volatility are found to be significant determinants of share price.
Originality/value
This is the first of its kind in the country that considers the impact of corporate governance, ownership structure, and firm value on the Ghana Stock Exchange (GSE).
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Godfred Alufar Bokpin, Lord Mensah and Michael E. Asamoah
The purpose of this paper is to investigate the impact of natural resources on foreign direct investment (FDI) in Africa. Decomposing the measures of natural resource, in terms of…
Abstract
Purpose
The purpose of this paper is to investigate the impact of natural resources on foreign direct investment (FDI) in Africa. Decomposing the measures of natural resource, in terms of contribution to GDP (oil rent (OR), mineral rent (MR) and forest rents (FRs)) and export drive (fuel exports (FE) and minerals export), with the objective of obtaining quantitative estimates of their relationship with FDI, we considered the effect of regional or trade blocks on the continent and control for trade openness, financial market development and infrastructure.
Design/methodology/approach
Using annual panel data of 49 African countries over the period 1980-2011 and employing the system GMM estimation technique.
Findings
The authors show that after allowing for effect of trade or regional block formation, natural resources in its composite form (ORs, MRs, forest rents (FRs), FEs and minerals export) influences FDI in Africa. Quantitatively, we demonstrate that though natural resources (compositely) influences FDI, the different measures of natural resource differ significantly in terms of their marginal contribution in attracting FDI to the continent especially to different trade blocks. The authors provide that in the presence of certain type of natural resources, trade openness or banking sector credit expansion or infrastructural development is less desirable whilst regional or trade blocks strongly moderate the effect of financial market development and infrastructural development on FDI flow on the continent.
Originality/value
The authors employed a broad data set to provide evidence of the association between natural resources in its composite form and well as its various component and FDI to African after accounting for regional/trade blocks.
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Godfred A. Bokpin, Zangina Isshaq and Francis Aboagye‐Otchere
The purpose of this paper is to examine the impact of ownership structure and corporate governance on corporate liquidity policy from a developing country perspective, Ghana Stock…
Abstract
Purpose
The purpose of this paper is to examine the impact of ownership structure and corporate governance on corporate liquidity policy from a developing country perspective, Ghana Stock Exchange (GSE).
Design/methodology/approach
The authors adopt multiple regression analysis in estimating the relationship between ownership structure, corporate governance and corporate liquidity policy as well as the impact of corporate governance on insider ownership.
Findings
The authors find that foreign share ownership significantly predicts corporate cash holding on the GSE. The empirical result also portrays positive and statistically significant relationship between board size, financial leverage, firm size, profitability and corporate liquidity holding, and a negative and statistically significant relationship between board composition and corporate liquidity holding. The authors also document positive and statistically significant relationship between the various industry classifications namely manufacturing, distribution and the pharmaceutical industry and corporate cash holdings on the GSE but did not however find significant relationship between corporate governance and insider ownership on the GSE. The authors found positive relationship between Tobin's Q and inside ownership.
Originality/value
The main value of this paper is to analyze the relationship between ownership structure, corporate governance and corporate liquid policy from a developing country perspective.
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Zangina Isshaq, Godfred A. Bokpin and Benjamin Amoah
Purpose – This paper examines the interaction of efficiency and bank risk taking in the Ghanaian banking industry.Design/methodology/approach – We relate risk taking to price…
Abstract
Purpose – This paper examines the interaction of efficiency and bank risk taking in the Ghanaian banking industry.
Design/methodology/approach – We relate risk taking to price competitiveness, foreign ownership and cost efficiency and other control variables. Cost-inefficiency scores from a stochastic frontier model are used, and a Lerner price index is employed to proxy for market power.
Findings – Our results suggest that market power affects risk taking when conditioned on foreign ownership, but foreign bank risk-taking behaviour is not statistically different from local banks. Cost inefficiency diminishes bank soundness. We also find that industry concentration discourages greater risk taking.
Originality/value – Our study extends the views on risk taking and competition among banks in Ghana, which throws more light from an emerging economy perspective.
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The purpose of this paper is to examine the effects of financial market development on corporate financing of emerging market firms to ascertain whether or not interactions in the…
Abstract
Purpose
The purpose of this paper is to examine the effects of financial market development on corporate financing of emerging market firms to ascertain whether or not interactions in the financial market has any impact on the available choice of financing of firms.
Design/methodology/approach
Panel data covering the period 1990‐2006 for 34 emerging market economies were analyzed within the framework of Pesaran's dynamic fixed effect model and the pooled mean group estimator to capture the short‐ and long‐run effects of the covariates on the endogenous variables.
Findings
The findings of the research indicate significantly that the direction and magnitude of the impact of financial market development and macroeconomic variables on capital structure vary with the maturities of the security issue. It is also documented that firm level variables such as profitability, investment opportunity, asset tangibility and risk are equally important in predicting firms' capital structure decisions. The findings also indicate that economy wide variables such as gross domestic product per capita are significant predictors of financing choices of firms. The results of the study generally support existing literature on the impact of financial market development, macroeconomic variables and certain firm level factors on capital structure.
Originality/value
The paper considers unique data from emerging market economies over a 17‐year period.
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Eric Osei‐Assibey, Godfred A. Bokpin and Daniel K. Twerefou
The purpose of this paper is to investigate the determinants of financing preference of micro and small enterprises (MSEs) whilst distinguishing a broader range of financing…
Abstract
Purpose
The purpose of this paper is to investigate the determinants of financing preference of micro and small enterprises (MSEs) whilst distinguishing a broader range of financing sources beyond what is typically the case within the corporate finance literature.
Design/methodology/approach
Under the framework of ordinal logistic regression, the paper also tests whether there is evidence of hierarchical preference ordering as predicted by pecking order theory (POH) using field survey data for 2009.
Findings
The authors relate that new enterprises are more likely to prefer low cost and less risky or less formal financing such as internal or bootstrap finances. However, as the enterprise gets established or matures, its capacity to seek formal financing increases, thereby becoming more likely to prefer or being in a higher category of formal financing. While the paper affirms the POH, it is argued that this order is a consequence of severe persistent constraints other than sheer preference. The findings further reveal that, microentrepreneur's and MSE's‐specific level socio‐economic characteristics such as owner's education or financial literacy status, households tangible assets, ownership structure, enterprise size, as well as sensitivity to high interest rates in the credit market, to be important determinants of either past (start‐up), present or future financing preference.
Originality/value
The main value of this paper is to analyse the determinants of financing preference of MSEs within the context of rural financial market (RFM) from a developing country perspective.
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The purpose of this paper is to document the effect of ownership structure and corporate governance on bank efficiency in the Ghanaian banking industry.
Abstract
Purpose
The purpose of this paper is to document the effect of ownership structure and corporate governance on bank efficiency in the Ghanaian banking industry.
Design/methodology/approach
The author applies both accounting data and efficiency measures from the period 1999‐2007 via panel data analysis. Efficiency is measured by computing distances from the stochastic frontiers of estimated translog cost and profit functions. These efficiency measures are regressed on ownership and governance variables with dummy variables for bank types.
Findings
The results show that foreign banks are more cost‐efficient than domestic banks, but not necessarily more profit‐efficient. Nevertheless, foreign banks are more profitable than domestic banks and enjoy better quality loans. Managerial ownership leads to the cost inefficiency of banks. Banks with inside ownership are unprofitable overall but maintain a high loan quality. Governance (a larger board size) strongly improves profit efficiency but slightly worsens banks' cost efficiency. Finally, the capital adequacy ratio and bank size are both significant predictors of bank efficiency in Ghana.
Originality/value
Few, if any, studies have been carried out in the Ghanaian banking industry.
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