M Sc Dissertation Proposal ( Dividend policy) - Essay Example

The dividend policies to be undertaken are based on the present and future financial attitudes of the company. The inclination and direction of the investors are also considered. A company may select any of the following three types of dividend policies; The disbursement and amount of dividends are factors for debate for quiet a long time now. Black (1976) states that, “Under conditions of symmetric information and taxes, dividends have been dubbed a puzzle”. A number of authors model dividend policy based on the assumption that info is dealt out asymmetrically between managers and capitalists.

Bhattacharya (1979, 1980) indicates that firms pay dividends since dividends indicate the private information of directors and thus it assists market players evaluate about the firm accordingly. Some of the major oil producing companies in the UK and those listed in the stock exchanges is taken as sample for the research work. Their dividend policies and the percentage of pay out in these firms of the oil sector are considered for the research analysis. The study will follow the ‘Research Process’.

Collis and Hussey explain, ‘Research is a process of enquiry and investigation that is conducted in a systematic and methodical way with a view to increasing knowledge’ (Collis and Hussey, 2009). In simple terms the research process can be understood in four steps, a) Plan Search, b) do the research, c) Collect info, and d) Evaluate and reflect. The research will be based on a secondary research. The rationale of the research is to analyse the dividend policy of the oil sector for the last five years.

Based on the analysis, a conclusion of the dividend policy of the company will be figured out. The Lintners model on dividend policy will be surveyed to identify and explain the dividend policy of the oil sector. The analysis of the research would be to examine the number of firms which had