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Abstract
This study aims to examine the impact of investment opportunities and the global financial crisis on dividend repatriation policy. Additionally, it investigates the interaction effect of credit market development on the association between investment opportunities and dividend repatriation policy. The current study uses secondary data concerning the foreign subsidiaries of US MNCs in 50 countries during the period 2005–2016. Dynamic panel generalised method of moments (GMM) estimator is applied to estimate the dynamic dividend repatriation models. The findings reveal that investment opportunities in the host country significantly negatively influence the dividend repatriation policy. However, credit market development in the host country significantly positively interacts the link between investment opportunities and dividend repatriation policy. This implies that credit market development reduces the negative impact of investment opportunities on the dividend repatriation policy. Further, the findings suggest that dividend repatriation by US MNCs increased significantly during the global financial crisis.
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No potential conflict of interest was reported by the author(s).
Additional information
Notes on contributors
Muhammad Tahir
Muhammad Tahir is an Assistant Professor at the Department of Management Sciences, University of Turbat, Baluchistan, Pakistan. He earned his PhD degree from the School of Management, Universiti Sains Malaysia. His area of research is international finance, corporate finance and corporate governance
Haslindar Ibrahim
Haslindar Ibrahim is a Senior Lecturer at the School of Management, Universiti Sains Malaysia. She earned her PhD degree from the Universiti of Malaya. Her area of research is corporate performance, corporate governance, ownership structure, agency cost and Islamic philanthropy.
Abdul Hadi Zulkafli
Abdul Hadi Zulkafli is a Senior Lecturer at the School of Management, Universiti Sains Malaysia. He earned his PhD degree from the Universiti of Malaya. His area of research is corporate governance, corporate finance and sustainability.
Muhammad Mushtaq
Muhammad Mushtaq is a Lecturer at the Department of Commerce, University of Turbat, Baluchistan, Pakistan. He earned his PhD from the Graduate School of Business (GSB), Universiti Sains Malaysia. His area of research is corporate finance and corporate performance.
Safi Ullah
Safi Ullah is serving as Bursar at Baluchistan Residential College, Uthal, Baluchistan, Pakistan. He earned his MS degree from Department of Management Sciences, Pakistan Institute of Development Economics (PIDE), Islamabad, Pakistan. His area of research is foreign investment and corporate finance.