**Appendices**

The coefficients (Eq. (3)) that result from the regression for all countries are not statistically significant. Unlike what Caliskan and Kerestecioglu (2013) say, we find that for the countries under study and for this temporary space, it is not possible to demonstrate that there is a

**Country VOLAM Coef. Std.Err. t P > |t| [95% Conf.Interval]** Argentina FREF 0.0944 0.069 1.37 0.185 −0.0482 0.237

Brazil FREF 0.377 0.5232 0.72 0.473 −0.6708 1.4263

Chile FREF 2.0296 12.76 0.16 0.875 −23.8373 27.89

Perú FREF 6.39 7.167 0.89 0.379 −8.2 20.9898

Colombia FREF 36.7117 29.7348 1.23 0.229 −24.799 98.223

**Table 8.** Estimated coefficients, standard errors and significance of variables. Variable response VOLAM.

\_cons 3.3073 3.863 0.86 0.4 −4.66 11.28

\_cons 61.06 37.40 1.63 0.108 −13.89 136.01

\_cons 1278.75 518.03 2.47 0.018 229.11 2328.38

\_cons 576.87 450.35 1.28 0.209 −340.47 1494.21

\_cons 2490.83 1699.5 1.73 0.097 −574.85 6456.51

Floating capital ratio can affect the price of shares in two ways: first, a small quantity of shares can make a stock unattractive to investors, and second, a low floating capital in the market represents less amount of shares available to negotiate, which can cause inadequate liquidity [7]. These statements make it possible to conclude that a low floating capital ratio has the

Different authors studied the effect of stock property concentration on stock return (7), others address the adverse change in market liquidity of stocks as a result of the decrease in free float (6), or the effect of the free float ratio (FFR) on stock return, risk, and trading activity (8). This study documented the effects of floating capital ratio on price returns, price volatility and traded volume in Latin American capital markets. Data from 181 firms listed at the end of 2016 was used. These enterprises are part of the most representative indices of each market based on traded volume or market capitalization. Results obtained applying linear regres-

It is observed, for this temporary space and according to the sample requested, that in the case of Argentina, free float ratio is not statistically significant in the variation share prices. Volatility or the negotiated volume presents an inverse relationship with floating capital.

In the studies made for the countries of Peru and Colombia, we found that greater floating capital affects profitability in a positive way but only in Peru, it is possible to say that a greater floating capital affects volatility in stock prices. For the case of Chile and Brazil, it is not possible

effect of reducing the value of shares due to insufficient demand from investors [11].

sions methods show different situations in each country.

to obtain conclusions since results were not significant.

relationship between both variables.

44 Firm Value - Theory and Empirical Evidence

**5. Conclusion**


**No. Companies FREF DESV VOLAM LREA** ECORODOVIAS ON/d 35.75 38.86 23.71 51.07 ENGIE BRASIL/d 31.29 19.14 31.99 9.42 ELETROBRAS ON/d 31.67 64.75 30.69 137.63 ELETROBRAS PNB/d 92.78 53.89 30.49 90.82 EMBRAER ON/d 94.59 28.90 49.50 −62.96 ENERGIAS BR ON/d 48.73 24.15 28.92 21.02 EQUATORIAL ON/d 100.00 21.24 51.94 48.45 ESTACIO PART O/d 85.56 46.02 34.04 24.55 FIBRIA ON/d 41.46 38.56 66.09 −46.93 GERDAU PN/d 80.12 43.31 106.64 84.73 GERDAU MET PN/d 98.30 53.56 69.32 106.18 HYPERMARCAS ON/d 59.15 21.69 70.54 20.28 ITAUSA PN/d 82.95 24.34 163.42 36.01 ITAUUNIBANCO P/d 100.00 26.12 413.68 40.52 JBS ON/d 34.21 63.82 94.75 −3.42 KLABIN UNT/d 100.00 28.91 49.31 −25.21 KROTON ON/d 93.54 36.46 123.05 36.22 LOJAS AMERIC P/d 64.99 35.56 37.49 5.63 LOJAS RENNER O/d 84.98 29.34 71.43 32.46 MARFRIG ON/d 42.63 35.65 15.75 4.01 MRV ON/d 64.46 29.14 30.25 26.13 MULTIPLAN ON/d 69.33 26.80 37.64 45.48 NATURA ON/d 40.04 38.52 33.76 −0.32 P.ACUCAR-CBD P/d 93.82 33.47 46.56 26.87 PETROBRAS ON/d 49.58 35.49 149.59 68.14 PETROBRAS/d 76.06 39.92 586.91 79.72 QUALICORP ON/d 100.00 34.98 33.75 41.50 RAIADROGASIL O/d 67.38 24.07 63.75 55.51 RUMO/d 90.69 43.83 43.57 −1.62 LOCALIZA ON/d 71.94 32.22 34.90 34.93 SANTANDER BR U/d 100.00 35.14 25.78 66.88 SABESP ON/d 49.74 33.87 49.88 42.86 TRANS ALIANCA /d 100.00 23.43 22.76 34.80 TIM PART ON/d 33.40 23.65 21.35 15.86 ULTRAPAR ON/d 70.07 21.01 87.84 14.74

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**N 1.** Information of companies of the MERVAL-ARGENTINA. *Source*: Thomson Reuters Eikon.


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**No. Companies FREF DESV VOLAM LREA** Tenaris SA 39.45 28.94 9.62 56.04 Edenor SA 51.00 33.52 5.12 50.84 Mirgor SA 51.74 46.99 7.56 44.76 Cresud SA 69.19 30.86 11.78 33.00 Telecom SA 96.14 32.30 4.68 28.26 Banco Macro SA 61.59 34.65 10.58 26.37 Y.P.F. SA 48.99 33.66 19.38 17.11 Consultatio SA 31.07 31.18 3.69 15.73

 Siderar SA 39.06 32.79 9.00 14.89 Banco Francés SA 24.05 29.71 8.27 4.56 Aluar Aluminio SA 27.42 31.55 5.29 −13.74 Comercial del Plata 100.00 34.43 8.63 −18.68

**N 1.** Information of companies of the MERVAL-ARGENTINA. *Source*: Thomson Reuters Eikon.

**No. Companies FREF DESV VOLAM LREA** AMBEV ON/d 28.07 18.82 235.53 −4.89 BRASIL ON/d 37.54 41.14 202.68 68.99 BRADESCO ON/d 26.05 28.14 39.69 49.15 BRADESCO PN/d 97.76 28.38 295.73 55.22 BBSEGURIDADE O/d 33.69 26.95 125.92 21.15 BRADESPAR PN/d 98.55 47.59 25.80 109.83 BRF FOODS ON/d 95.31 29.14 113.18 −11.06 BRASKEM PNA/d 54.93 33.50 39.14 32.08 BR MALLS PAR O/d 95.55 33.33 61.78 33.62 BMF BOVESPA ON/d 97.56 26.12 173.57 44.64 CCR RODOVIAS O/d 48.78 34.04 70.43 28.66 CIELO ON/d 41.20 29.58 161.20 1.31 CEMIG PN/d 92.57 47.51 51.03 34.89 CPFL ENERGIA O/d 66.11 8.43 37.14 54.28 COPEL PNB/d 78.74 39.36 18.38 16.18 COSAN ON/d 37.71 31.31 33.85 48.44 SID NACIONAL O/d 44.30 53.53 65.68 99.79 CYRELA REALT O/d 64.38 37.91 24.99 34.05

88.40 31.23 19.96 15.16

 Grupo Financiero Galicia SA

Firm Value - Theory and Empirical Evidence


**No. Companies FREF DESV VOLAM LREA** ORO BLANCO/d 20.23 44.67 293.03 12.92 PARQ ARAUCO/d 55.80 19.09 1145.36 29.15 QUINENCO/d 14.82 23.45 217.47 23.11 RIPLEY CORP/d 28.79 22.70 561.83 30.36 SMSAAM/d 39.89 22.23 209.26 14.04 SALFACORP/d 76.21 38.17 146.27 25.65 GRUPO SECURITY/d 37.53 21.00 221.15 17.42 SIGDO KOPPERS/d 34.82 22.82 165.11 0.00 SONDA/d 47.88 20.89 1190.40 −6.19 SOQUIMICH B/d 69.93 30.30 2667.48 35.55 SANTANDER CHIL/d 29.82 18.84 2065.53 14.44 VAPORES/d 27.98 35.02 390.35 23.39

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**N 3.** Information of companies of the IPSA-CHILE. *Source*: Thomson Reuters Eikon.

**No Companies FREF DESV VOLAM LREA** ALICORP/d 75.66 16.88 6561.95 24.71 ANDINO INVEST/d 26.12 40.47 24.85 53.41 AUSTRAL GROUP/d 10.65 46.15 16.18 18.92 BCO CONTINENTA/d 7.76 20.10 2211.62 56.07 CEM PACASMAYO/d 49.99 18.76 4011.91 30.50 BUENAVENTURA/d 49.36 36.13 282.66 67.59 ATACOCHA/d 100.00 50.25 151.22 137.63 CREDICORP/d 65.20 20.04 1035.22 49.67 ENGEPE/d 16.40 26.82 623.63 13.91 ENEL DIST PERU/d 100.00 23.29 351.87 23.19 CASA GRANDE/d 37.57 26.96 124.55 71.69 FERREYROS/d 100.00 22.88 1720.30 29.01 GRANA Y MONTER/d 77.08 82.84 2513.65 89.05 INRETAIL PERU/d 27.31 14.06 865.85 32.52 INTERGROUP/d 42.95 17.69 2564.01 38.68 INV CENTENARIO/d 62.90 23.92 10.99 −8.00 LUZ DEL SUR/d 16.07 16.49 495.57 40.53 MINSUR/d 100.00 28.88 717.87 87.55 PANORO/d 82.84 57.10 13.36 76.64

**N 2.** Information of companies of the BOVESPA- BRAZIL. *Source*: Thomson Reuters Eikon.


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**N 3.** Information of companies of the IPSA-CHILE. *Source*: Thomson Reuters Eikon.

**No. Companies FREF DESV VOLAM LREA** AGUAS ANDINAS /d 32.60 24.46 1875.71 −5.16 EMB ANDINA B/d 39.44 24.05 642.72 16.35 ANTAR CHILE/d 3.94 17.53 164.13 1.50 AESGENER/d 30.42 28.01 1043.89 −27.06 BANMEDICA/d 31.58 21.65 179.14 22.92 BCI/d 34.95 18.20 1686.37 25.67 CAP/d 36.70 47.46 1563.67 99.43 CMPC/d 39.36 22.08 1935.19 −11.52 CERVECERIAS UN/d 16.41 17.40 1822.74 −12.03 CENCOSUD/d 39.74 17.24 5408.48 28.12 BANCO DE CHILE/d 20.78 15.87 2171.01 10.67 SM BANCO CHILE/d 100.00 14.69 437.37 15.04 VINA CONCHA TO/d 31.88 16.96 741.81 0.68 COLBUN/d 35.31 20.23 1286.89 −25.31 EMPRESAS COPEC/d 25.24 21.82 2049.63 4.95 ENGIE ENERGIA /d 44.49 18.19 837.73 7.14 EMBONOR B/d 62.27 20.89 276.32 27.81 ENEL AMERICAS/d 43.90 19.09 3289.75 2.88 ENEL GENERACIO/d 34.65 20.15 2537.08 −33.15 ENTEL/d 35.89 19.93 1551.88 11.35 FALABELLA/d 33.19 17.36 6052.37 16.21 FORUS/d 26.52 25.64 353.92 25.35 IAM SA/d 24.33 26.74 422.19 −3.38 INV LA CONSTRU/d 24.99 27.41 358.04 13.97 ITAU CORPBANCA/d 22.07 18.18 1847.03 −4.05 LATAM AIRLINES/d 47.24 26.17 2830.31 42.08 MASISA/d 30.04 39.45 138.35 61.44

**N 2.** Information of companies of the BOVESPA- BRAZIL. *Source*: Thomson Reuters Eikon.

**No. Companies FREF DESV VOLAM LREA** USIMINAS PNA/d 79.38 55.02 70.18 98.96 VALE ON/d 39.64 41.91 126.03 68.43 TELEF BRASIL P/d 37.09 18.80 84.72 25.28 WEG ON/d 35.65 27.10 32.05 6.14

Firm Value - Theory and Empirical Evidence



**Author details**

**References**

Cordoba; 2013

2010;**10**(1):56-62

0120-3592

Asia and Pacific DSI 2007.

Journal of Business. 1987;**60**(3):323-345

Tolosa Leticia Eva\* and Nicolas María Claudia

\*Address all correspondence to: leticiaetolosa@gmail.com

School of Economic Sciences, National University of Cordoba, Argentina

**N 5.** Information of companies of the COLCAP- COLOMBIA. Source: Thomson Reuters Eikon.

**No Companies FREF DESV VOLAM LREA** EXITO/d 35.39 12.76 9485.99 9.87 CORFICOLCF/d 36.26 24.75 3747.63 −0.22 CLH/d 25.12 18.70 3531.05 9.27 PFDAVVNDA/d 92.40 15.97 7224.65 31.93 CELSIA/d 42.99 13.66 1293.18 36.29 ETB/d 10.57 18.28 551.91 14.50 CNEC/d 80.07 24.66 1183.16 50.88 CONCONCRET/d 26.21 18.30 322.47 2.74 PFAVH/d 100.00 35.04 3052.93 75.33

Effect of Free Float Ratio on the Behavior of Shares Valuation in Companies Listed in Latin…

http://dx.doi.org/10.5772/intechopen.76421

[1] Tolosa L. The informative content of the financial statements and prices of the stock in the investment decision making. Analysis of companies listed on the Argentine Capital Market [doctoral thesis]. Argentina: School of Economic Sciences. National University of

[2] Chaopricha P, Chan P, Pollard D. Firm characteristics and stock return. International DSI.

[3] Kormendi R, Lipe R. Earnings innovations, earnings persistence, and stock returns. The

[4] Chaopricha P, Peng Chan P. Measuring the importance of ROE and market capitalization: Evidence from Thailand's stock market. International Journal of Business Strategy.

[5] O'shee D, Mongrut Montalván S, Nash M, Benavides J. Company holdings structure and stock yields in South America. Cuad. Adm. Bogota (Colombia). 2008;**21**(35). ISSN

**N 4.** Information of companies of the I GENERAL-PERU. *Source*: Thomson Reuters Eikon.


Effect of Free Float Ratio on the Behavior of Shares Valuation in Companies Listed in Latin… http://dx.doi.org/10.5772/intechopen.76421 


**N 5.** Information of companies of the COLCAP- COLOMBIA. Source: Thomson Reuters Eikon.

## **Author details**

**No Companies FREF DESV VOLAM LREA** RELAPASA/d 17.62 37.21 243.67 70.61 SIDER/d 9.97 36.91 78.47 109.86 CERRO VERDE/d 5.86 29.48 84.56 32.16 MINERA EL BROC/d 35.27 31.55 38.58 33.35 TREVALI MINING/d 98.99 51.46 44.58 87.31 BACKUS JOHNSTO/d 11.10 19.94 94.79 26.11 UNACEM/d 32.33 24.79 924.05 46.95 ACEROS AREQUIP/d 100.00 34.65 490.94 65.54 SOUTHERN COPPE/d 10.56 24.19 99.80 24.69 VOLCAN MINERA/d 100.00 36.03 2856.84 135.67 BOLSA DE VALOR/d 74.47 12.91 8.57 5.11 CANDENTE/d 95.77 97.53 5.06 35.67 ENGIE ENER PER/d 38.23 15.01 1776.72 14.15 PERUV METALS/d 87.10 77.51 12.57 126.69 VOLCAN MINERA/d 25.75 49.13 2.72 18.23

Firm Value - Theory and Empirical Evidence

**N 4.** Information of companies of the I GENERAL-PERU. *Source*: Thomson Reuters Eikon.

**No Companies FREF DESV VOLAM LREA** ECOPETROL/d 10.97 22.50 15747.98 21.77 EEB/d 18.99 11.96 947.38 5.10 GRUPOAVAL/d 2.25 19.11 291.99 7.93 PFAVAL/d 47.19 14.68 4687.84 10.86 BCOLOMBIA/d 34.94 19.97 7916.54 18.41 PFBCOLOM/d 97.55 19.69 19438.60 22.98 ISA/d 36.49 15.20 3435.78 30.18 BOGOTA/d 10.46 20.16 743.53 1.17 GRUPOSURA/d 46.38 14.33 8267.88 6.77 PFGRUPSURA/d 89.93 14.63 5078.49 6.13 GRUPOARGOS/d 74.54 16.44 4273.79 17.41 PFGRUPOARG/d 92.98 15.17 3074.15 17.16 CEMARGOS/d 35.45 16.58 6257.46 19.90 PFCEMARGOS/d 92.02 14.26 2854.31 15.54 NUTRESA/d 41.06 10.62 3821.21 9.60 PROMIGAS/d 11.53 28.08 41.74 3.92

Tolosa Leticia Eva\* and Nicolas María Claudia

\*Address all correspondence to: leticiaetolosa@gmail.com

School of Economic Sciences, National University of Cordoba, Argentina

#### **References**


[6] Hardouvelis GA, Karalas G. Style Concentration in Ownership and Expected Stock Returns. 2016. Available from: SSRN: https://ssrn.com/abstract=3065191 or http://dx.doi. org/10.2139/ssrn.3065191

**Chapter 4**

Provisional chapter

**Ask of National Pension Service for Higher Dividend**

DOI: 10.5772/intechopen.75578

In this chapter, we examine the effect of ask of Korea's National Pension Service for higher dividend on the firm value. There is a conflicting view on the dividend pressure of the National Pension Service. First, the dividend pressure of the National Pension Service contributes not only to reducing the agency problem, which is a disadvantage for Korean companies' ownership management, but also to reducing the Korea discount, which is a low dividend. The other hand, it is the so-called pension socialism that National Pension Service engages in the dividend policy which is the essence of corporate management with a high stake. This study is conducted on Korean listed companies from 2011 to 2016 and has constructed a test sample using propensity score matching. The results show that the dividend pressure of National Pension Service doesn't have a significant effect on the firm value. This study is expected to provide useful information for pension funds to exercise voting rights. Also, this study is expected to provide further evidence of a study that verifies the relationship between dividend and firm value by examining the effect of

Keywords: National Pension Service, dividend policy, firm value, pension funds, voting

The purpose of this study is to analyze the effect of the demand for higher dividends of Korea's National Pension Service (NPS) on firm value. The NPS is one of the top three pension funds in the world, together with Japan's public pension fund and Norwegian sovereign fund. At the same time, it is one of the fastest growing pension funds in the world. The NPS is expected to grow to \$ 1.21 trillion by 2025, from \$ 0.54 trillion in the first quarter of 2017. According to the

> © 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and eproduction in any medium, provided the original work is properly cited.

© 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use,

distribution, and reproduction in any medium, provided the original work is properly cited.

Ask of National Pension Service for Higher Dividend

**and Firm Value: Evidence from Korea**

and Firm Value: Evidence from Korea

Additional information is available at the end of the chapter

external pressures on dividend policy on firm value.

Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.75578

Jung Hee Noh

Jung Hee Noh

Abstract

rights

1. Introduction


#### **Ask of National Pension Service for Higher Dividend and Firm Value: Evidence from Korea** Ask of National Pension Service for Higher Dividend and Firm Value: Evidence from Korea

DOI: 10.5772/intechopen.75578

Jung Hee Noh Jung Hee Noh

[6] Hardouvelis GA, Karalas G. Style Concentration in Ownership and Expected Stock Returns. 2016. Available from: SSRN: https://ssrn.com/abstract=3065191 or http://dx.doi.

[7] Chan K, Chan Y, Fong W. Free float and market liquidity: A study of hong kong govern-

[8] Çalişkan M, Kerestecioğlu S. Effects of free float ratios on stock prices: An application on

[9] Kalok C, Yue-Cheong C, Wai-Ming F. Free float and market liquidity: A study of Hong Kong government intervention. Journal of Financial Research. 2002;**27**(2):179-197 [10] Ginglinger E, Hamon J. Ownership, Control and Market Liquidity. In: Finance. Vol. 33.

[11] Bostanci F, Kiliç S. The effects of free float ratios on market performance: An empirical study on the Istanbul Stock Exchange. Istanbul Stock Exchange Review. 2010;**12**(45):1-14

ment intervention. Journal of Financial Research. June 2004;**27**(2):179-197

Ise. Doğuş Üniversitesi Dergisi. 2013;**14**(2):165-174

Grenoble: Presses universitaires. 2012/2. ISBN: 9782706117879

org/10.2139/ssrn.3065191

52 Firm Value - Theory and Empirical Evidence

Additional information is available at the end of the chapter Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.75578

#### Abstract

In this chapter, we examine the effect of ask of Korea's National Pension Service for higher dividend on the firm value. There is a conflicting view on the dividend pressure of the National Pension Service. First, the dividend pressure of the National Pension Service contributes not only to reducing the agency problem, which is a disadvantage for Korean companies' ownership management, but also to reducing the Korea discount, which is a low dividend. The other hand, it is the so-called pension socialism that National Pension Service engages in the dividend policy which is the essence of corporate management with a high stake. This study is conducted on Korean listed companies from 2011 to 2016 and has constructed a test sample using propensity score matching. The results show that the dividend pressure of National Pension Service doesn't have a significant effect on the firm value. This study is expected to provide useful information for pension funds to exercise voting rights. Also, this study is expected to provide further evidence of a study that verifies the relationship between dividend and firm value by examining the effect of external pressures on dividend policy on firm value.

Keywords: National Pension Service, dividend policy, firm value, pension funds, voting rights
