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Dividends and politics

Bank, Steven, Cheffins, Brian and Goergen, Marc 2009. Dividends and politics. European Journal of Political Economy 25 (2) , pp. 208-224. 10.1016/j.ejpoleco.2009.01.002

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This paper contributes to a growing literature on politics and corporate governance by providing an empirical analysis of the impact of political factors on dividend payouts. The focus is on the determinants of dividend policy in U.K. public companies between 1949 and 2002. We augment Lintner's [Lintner, J., 1956. Distribution of incomes of corporations among dividends, retained earnings, and taxes. American Economic Review 46, 97–113.] partial adjustment model by including measures of politics and test the model using aggregate annual dividends and earnings data. We find neither the political placement of the party in power nor regulations explicitly designed to regulate corporate behaviour correlate in the direction political theories of corporate governance would predict.

Item Type: Article
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: D History General and Old World > DA Great Britain
H Social Sciences > H Social Sciences (General)
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HJ Public Finance
J Political Science > JA Political science (General)
J Political Science > JF Political institutions (General)
Uncontrolled Keywords: Corporate governance ; Dividend policy ; Politics ; Tax rules ; Dividend controls
Publisher: Elsevier
ISSN: 0176-2680
Last Modified: 04 Jun 2017 03:33

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