Asymmetric Information and Dividend Policy

Asymmetric Information and Dividend Policy Author(s): Kai Li and Xinlei Zhao Reviewed work(s): Source: monetary Management, Vol. 37, No. 4 (Winter, 2008), pp. 673-694 Published by: Blackwell Publishing on behalf of the Financial Management Association transnational Stable universal resource locator: hypertext transfer protocol://www.jstor.org/stable/20486675 . Accessed: 25/07/2012 04:26
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Asymmetric

Information Policy

and Dividend

Kai Li and XinIei Zhao*
We tryoutine how informational asymmetries affectfirms dividendpolicies.



Wefind thatfirms that are more national to information asymmetry are less likely topay, initiate, or increase dividends, and disburse smaller amounts. We show that our main results are not driven by our sample and that our results persist later accountingfor the changing composition ofpayout over the sample period, the increasing impressiveness of institutional shareholdings, and catering incentives. We conclude that there is a nix relation between asymmetric information and dividend policy. Our results do not support the signaling theory of dividends.

In thispaper, studyhow informational we asymmetriesaffect firms dividendpolicies by exam ining the relation between a firmsdividendpolicy and thequalityof its information environment. Dividends have capacious puzzled financial...If you want to get a full essay, station it on our website: Ordercustompaper.com



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