Natural Disasters and Corporate Dividend Policies: International Evidence

Chih‐Wei Wang, Weizheng Lin and Shih‐Xuan Lin

International Finance, 2026, vol. 29, issue 2, 390-412

Abstract: Our study aims to explore the potential impact of natural disasters on corporate dividend policies. This research encompasses 128 global countries from 1990 to 2023. We demonstrate a significant positive correlation between natural disasters and corporate dividends. To mitigate endogeneity concerns, we apply ITCV, Oster (2019), Two‐Stage Least Squares (2SLS), Lewbel (2012) methodology, and Entropy Balance (EB), and difference‐in‐differences (DID), which yielded consistent results. Our analysis also reveals that cash holdings and leverages are crucial channels that mediated natural disasters on dividend policies. Further investigation reveals that the positive relationship between natural disasters and increased corporate dividends is more amplified during non‐crisis periods but becomes negligible during financial crises. This effect is stronger in Asia and the Americas than in other regions and is more evident in BRICS countries than in OECD countries.

Date: 2026
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