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The most debated issue in the field of finance is over the effect of dividend policy on market price per share. There are huge literatures for and against this wisdom. The current study has been undertaken aiming at evaluating the effect of dividend policy on market price of share in the context of Bangladesh. The study has covered secondary data and analyzed the data by employing descriptive statistics, correlation and multiple regression models. It has tested hypothesis by using F test. The study has found that the effect of dividend payout is more on market price than retention. This dependency is significant at 1%. Finally, the paper concludes that the findings over the effect of dividend policy on market price supports the relevant theory of dividend policy i.e. Walter's model and Gordon's model.
Abdullah Al Hasan (2013) studied this question.