A macro-analysis of financial decisions : an examination of special dividend announcements

Beladi, Hamid, Chao, Chi Chur and Hu, May 2016, A macro-analysis of financial decisions : an examination of special dividend announcements, International review of financial analysis, vol. 48, pp. 162-181, doi: 10.1016/j.irfa.2016.09.015.

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Title A macro-analysis of financial decisions : an examination of special dividend announcements
Author(s) Beladi, Hamid
Chao, Chi ChurORCID iD for Chao, Chi Chur orcid.org/0000-0002-1056-469X
Hu, MayORCID iD for Hu, May orcid.org/0000-0002-0998-1592
Journal name International review of financial analysis
Volume number 48
Start page 162
End page 181
Total pages 20
Publisher Elsevier
Place of publication Amsterdam, The Netherlands
Publication date 2016-12
ISSN 1057-5219
Summary This paper investigates macro-level explanations for why firms pay special dividends. We find both the business cycle and market condition affect the propensity and abnormal returns of special dividends. Firms are more likely to announce special dividends in market or economic downturns than upturns. They tend to use additional cash for business growth in expansions and distribute it to reduce agency costs in contractions. The signaling effect of special dividends is stronger and companies with these announcements are better performers in recessions than in expansions. This research sheds light on and enhances the understanding of why firms disburse extra cash dividends at the aggregate level.
Language eng
DOI 10.1016/j.irfa.2016.09.015
Field of Research 140212 Macroeconomics (incl Monetary and Fiscal Theory)
1502 Banking, Finance And Investment
1501 Accounting, Auditing And Accountability
1801 Law
Socio Economic Objective 970115 Expanding Knowledge in Commerce
HERDC Research category C1 Refereed article in a scholarly journal
ERA Research output type C Journal article
Copyright notice ©2016, Elsevier
Persistent URL http://hdl.handle.net/10536/DRO/DU:30090314

Document type: Journal Article
Collections: Faculty of Business and Law
Department of Economics
Department of Finance
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