Dividend policy, corporate control and the tax status of the controlling shareholder

Christian Andres, André Betzer (), Inga Bongard and Marc Goergen
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Christian Andres: WHU-Otto Beisheim School of Management
André Betzer: Bergische Universität Wuppertal
Inga Bongard: University of Mannheim

Economia e Politica Industriale: Journal of Industrial and Business Economics, 2019, vol. 46, issue 2, No 3, 157-189

Abstract: Abstract This paper studies the impact of the concentration of control, the type of controlling shareholder and the dividend tax preference of the controlling shareholder on dividend policy for a panel of 220 German firms over 1984–2005. In line with the agency model, we find a negative relation between family control and dividend payouts at low and high levels of control. We also find evidence of reduced speed of adjustment of dividends at intermediate levels of family control. We further document that corporate control is associated with higher dividend payouts if an industrial or commercial corporation is the majority shareholder of the company. Finally, the results do not provide evidence that the tax preference of the largest shareholder matters for dividend payout decisions.

Keywords: Dividend policy; Payout policy; Lintner dividend model; Tax clientele effects; Corporate governance (search for similar items in EconPapers)
JEL-codes: G32 G35 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (5)

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Working Paper: Dividend Policy, Corporate Control and the Tax Status of the Controlling Shareholder (2012)
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DOI: 10.1007/s40812-018-0100-6

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