De Wet, Johannes H.v.H. (Johannes Hendrik van Heerden)Mpinda, Mvita Freddy2014-07-082014-07-082013-11De Wet, J & Mpinda, M 2013, 'The impact of dividend payments on shareholders' wealth : evidence from the Vector Error Correction Model', International Business and Economics Research Journal, vol. 12, no. 11, pp. 1451-1466.1535-0754 (print)2157-9393 (online)http://hdl.handle.net/2263/40621To date, a vast body of research has been established on dividend policy. However, little research has been done on the impact of dividend payments on shareholders’ wealth while considering the short- and long-run effects. This study is based on a sample of 46 companies listed on the Johannesburg Securities Exchange (JSE) for the period 1995 to 2010. The Vector Error Correction Model (VECM) was used to describe the short-run and long-run dynamics or the adjustment of the co-integrated variables toward their equilibrium values. Results indicate that in the long run, dividend yield is positively related to market price per share, while earnings per share do not have a significant impact on the market price per share.enClute Institute for Academic ResearchDividend paymentsMarket price per shareShareholders’ wealthRelevance and irrelevance theoryGranger causality modelJohansson co-integration testVector Error Correction Model (VECM)Earnings per share (EPS)Article