A conceptual review paper: revisiting the non-linear relationship between dividend and firm value in shariah and non-shariah compliant firms

Mohd Ashari Bakri and Mohd Nasir Samsulbahri and Mohamad Isa Abd Jalil and Md Hafizi Ahsan and Chia Chia Yong (2024) A conceptual review paper: revisiting the non-linear relationship between dividend and firm value in shariah and non-shariah compliant firms. International Journal of Islamic Studies, 36 (2). pp. 1-11.

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Abstract

In the modern corporate world, dividend policy is a widely discussed topic. Early academic literature mainly focused on the linear relationship between dividends and firm value. However, a non-linear (J-shaped) relationship was later discovered in major economies, indicating that firm value may have a more complex connection to dividends. This study reviews existing literature on the non-linear relationship between dividends and company value, suggesting that this relationship might also exist between Shariahcompliant and non-Shariah-compliant firms. The low leverage characteristic of Shariah-compliant firms may contribute to this potential relationship. An extensive search through Google Scholar and Scopus revealed that few empirical studies have examined this non-linear relationship. Notably, no analysis has yet investigated the non-linear relationship between dividends and firm value specifically among Shariahcompliant firms. This article provides a conceptual overview of how and why such a relationship may exist. The review highlights the need for further research, offering insights that could help policymakers and firms make informed decisions to enhance firm performance.

Item Type:	Article
Keyword:	Dividend policy Firm value Non-Shariah-compliant firms Shariah-compliant firms Conceptual review
Subjects:	D World History and History Of Europe, Asia, Africa, Australia, New Zealand, Etc. > DP Spain - Portugal > DP1-402 History of Spain > DP56-272.4 History > DP91-272.4 By period > DP97.3-160.8 711-1516. Moorish domination and the Reconquest > DP100-123 Moors in Spain. C\xF3rdoba. Kingdom of Granada H Social Sciences > HC Economic history and conditions > HC10-1085 Economic history and conditions
Department:	FACULTY > Labuan Faculty of International Finance
Depositing User:	ABDULLAH BIN SABUDIN -
Date Deposited:	15 Apr 2025 16:10
Last Modified:	15 Apr 2025 16:10
URI:	https://eprints.ums.edu.my/id/eprint/43510

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