Dual-class share structure on the dividend payout policy: Evidence from China Concepts Stocks

Hamid Beladi, May Hu, Silei Li and JingJing Yang

International Review of Financial Analysis, 2022, vol. 82, issue C

Abstract: This study investigates the impact of the dual-class share structure on the dividend pay-out policy for China Concepts Stocks listed on the US stock exchanges. Using a unique and hand-collected dataset, we find that the dual-class share structure negatively affects the propensity to pay dividends and the dividend payout ratios. Among firms with dual-class share structures, the divergence between voting and cash-flow rights also negatively affects the propensity to pay dividends and the dividend payout ratios. Furthermore, these dual-class firms are more susceptible to the tunneling to controlling shareholders. Our findings highlight the potential cost of adopting dual-class share structures in China, and the importance of external monitoring for Chinese US-listed firms with dual-share structure.

Keywords: Dual-class share structure; Dividend payout policy; China concepts stocks (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:82:y:2022:i:c:s1057521922001739

DOI: 10.1016/j.irfa.2022.102212

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