재무연구 제 권 호 (2009년 5월)
Asian Review of Financial Research, Vol., No..
pp.1261~1306
pp.1261~1306
Another dividend puzzle : Why do dividend-paying firms pay dividends quarterly?
Suk Hi kim College of Business Administration University of Detroit Mercy 4001 W. McNichols Road
Kenneth A. Kim State University of New York at Buffalo School of Management
Takeshi Nishikawa St. Johns University Tobin College of Business
In the U.S., dividends are paid quarterly, semiannually, or annually. Why do most dividendpaying firms pay dividends quarterly? We test explanations related to information signaling and agency costs, but neither explanations pan out. We also test whether managers are catering to shareholder demand for frequent dividends, but find no evidence of it. We then conduct an event study to see how the market reacts to dividend frequency-change announcements. When a firm announces an increase in its dividend-payout frequency, we find positive abnormal announcement returns. Further analysis suggests dividend frequency-increasing announcements signal an increase in future dividends, but not future earnings.
Suk Hi kim
Kenneth A. Kim
Takeshi Nishikawa
In the U.S., dividends are paid quarterly, semiannually, or annually. Why do most dividendpaying firms pay dividends quarterly? We test explanations related to information signaling and agency costs, but neither explanations pan out. We also test whether managers are catering to shareholder demand for frequent dividends, but find no evidence of it. We then conduct an event study to see how the market reacts to dividend frequency-change announcements. When a firm announces an increase in its dividend-payout frequency, we find positive abnormal announcement returns. Further analysis suggests dividend frequency-increasing announcements signal an increase in future dividends, but not future earnings.
