This study examines the cash dividend behaviour of a panel dataset 1,178 firms traded in London Stock Exchange (LSE) for period 2008–2017. Using modified version Lintner's (1956) partial adjustment model, it attempts to ascertain whether they follow stable policy and how 2008 global financial crisis affects stability UK. The results general show that LSE have long-term payout ratios slowly adju...

This paper analyzes whether a dividend tax cut for owner–managers of closely held corporations encourages income shifting, income generation, or both. We use rich, micro data from Sweden for the period 2000–2011 comprising the entire Swedish population, as well as firmand individual-level data for all owner–managers in closely held corporations, partnerships, and self-employed. We find robust e...

We ask whether stock returns in France, Germany, Japan, the UK and the US are predictable by three instruments: the dividend yield, the earnings yield and the short rate. The predictability regression is suggested by a present value model with earnings growth, payout ratios and the short rate as state variables. We find the short rate to be the only robust short-run predictor of excess returns,...

We show that a firm’s product characteristics are significantly related to its dividend and share repurchase policies. Using text-based analysis of product descriptions in firm 10-Ks, we examine how the propensity to pay dividends and repurchase shares are affected by how a firm’s products evolve over time, the local competition it faces, and the nature of the clientèle for the firm’s products....

We examine the joint predictability of return and cash flow within a present value framework, by imposing the implications from a long-run risk model that allow for both time-varying volatility and volatility uncertainty. We provide new evidence that the expected return variation and the variance risk premium positively forecast both short-horizon returns and dividend growth rates. We also conf...

In the classical Cramér-Lundberg model in risk theory the problem of maximizing the expected cumulated discounted dividend payments until ruin is a widely discussed topic. In the most general case within that framework it is proved (Gerber (1969), Azcue & Muler (2005), Schmidli (2007)) that the optimal dividend strategy is of band type. In the present paper we discuss this maximization problem ...

We examine firm valuation with optimal liquidity (retained earnings) and dividend choice under revenue uncertainty that incorporates debt financing and bankruptcy costs. We revisit the conditions for dividend policy irrelevancy and the role of retained earnings and dividends. Retained earnings have a net positive impact on firm value in the presence of growth options, high external financing co...

This paper considers the optimal dividend payment problem in piecewise-deterministic compound Poisson risk models. The objective is to maximize the expected discounted dividend payout up to the time of ruin. We provide a comparative study in this general framework of both restricted and unrestricted payment schemes, which were only previously treated separately in certain special cases of risk ...

This study examines share price and trading volumes data around the date of cash dividend distributions made by a sample of companies listed on The London Stock Exchange. The ex-day share price behaviour is modelled to take account of the personal taxes of long-term investors as well as the transaction costs and holding risks of short-term traders. The post-announcement drift is linked to the b...

In this paper, we consider a company where surplus follows a rather general diffusion process and whose objective is to maximize expected discounted dividend payments. With each dividend payment there are transaction costs and taxes and it is shown in [7] that under some reasonable assumptions, optimality is achieved by using a lump sum dividend barrier strategy, i.e. there is an upper barrier ...