The incidence and persistence of dividend omissions by Spanish firms

Andrew Benito ()
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Andrew Benito: Banco de España

No 303, Working Papers from Banco de España

Abstract: This paper examines the dividend policies of firms in Spain. Using firm-level panel data, models are estimated for dividend omissions as functions of financial characteristics, whilst also considering a role for persistence. The results are consistent with a tax discrimination model in which cash flow is the marginal source of funds. High degrees of persistence are also found in binary panel data models that control for unobservables and initial conditions. Whilst companies in Spain use the dividend to adjust the balance sheet, such persistence suggests this occurs slowly.

Keywords: Dividends; financial pressure; discrete panel (search for similar items in EconPapers)
JEL-codes: C23 E52 G35 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2003-04
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Persistent link: https://EconPapers.repec.org/RePEc:bde:wpaper:0303

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