Investor communication and payout policy: a field experiment

Xiaoqiao Wang, Jing Xie, Bohui Zhang and Xiaofeng Zhao

Review of Finance, 2025, vol. 29, issue 6, 1833-1870

Abstract: We conduct a field experiment to examine whether brief, unsolicited messages can influence corporate dividend policies. Messages highlighting investor concerns rooted in four dividend theories were sent to publicly listed firms. We find that messages framed around agency concerns significantly increase dividend payouts among past payers, particularly those with weaker governance. This effect is robust across alternative specifications and validated by a post-experiment survey. In contrast, messages based on bird-in-hand, signaling, or tax-clientele theories have no significant impact. Our findings suggest that dividend policy is more malleable than traditionally assumed and highlight the role of managerial perceptions in financial decision-making.

Keywords: dividend policy; field experiment; agency costs; investor relations (search for similar items in EconPapers)
JEL-codes: C93 G34 G35 (search for similar items in EconPapers)
Date: 2025
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