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This paper explores the relationship between market concentration, agency cost and firm performance using an unbalanced panel of 1911 publicly listed manufacturing firms in India for the period 2001 to 2020. It classifies firms according to ownership types and evaluates the effects of agency cost and market concentration on performance of firms. The study considers agency costs that result from principal-agent (PA agency costs) as well as from principal-principal conflicts (PP agency cost). Additionally, it shows how the interaction between various concentration indices and agency costs (PP and PA agency prices) affects performance. Using a generalized methods of moments technique to estimate three dynamic models, the study finds that both types of agency costs have a strong negative impact on performance, market concentration has a negative impact but is limited to certain types of firms and the combined effects between concentration and agency cost are strong which shows that an increase in market concentration causes a decline in performance due to an increase in agency cost. Thus, our findings support the prediction that competition acts as a disciplining device to reduce agency costs which in turn helps to reduce managerial slack and improve firm performance. Our study has several policy implications. [ABSTRACT FROM AUTHOR]

The study aims to understand the determinants of dividend trends of Indian firms. The study was based on a sample of 31,234 firms representing 15 different industry sectors. Construction materials, machinery and transportation equipment sectors were the most dividend intensive sectors in India. Partial least square structural equation modeling methodology (PLS SEM) was employed to examine the determinants of the dividend intensity of Indian firms. Different schemes of path models were tested and the results show that the higher the financial leverage, the lower is the propensity to pay dividends. Firms with high intangibles are expected to have higher agency costs. High growth firms have low dividend payout policies. Dividend intensity of firms is directly related to the size of firm. Higher the R&D intensity of the firms, greater is the dividend intensity of the firms. Firms with higher agency costs tend to have higher dividend intensity. Higher agency costs lead to lower cash flows for Indian firms. Firms with higher liquidity tend to pay more dividends. Profitable firms tend to have higher dividend intensity. [ABSTRACT FROM AUTHOR]