Dividend Policy and Earnings Quality: A Curvilinear Relationship

Ghassen Allani () and Yves Mard ()
Additional contact information
Ghassen Allani: UPHF - Université Polytechnique Hauts-de-France, LARSH - Laboratoire de Recherche Sociétés & Humanités - UPHF - Université Polytechnique Hauts-de-France - INSA Hauts-De-France - INSA Institut National des Sciences Appliquées Hauts-de-France - INSA - Institut National des Sciences Appliquées
Yves Mard: CleRMa - Clermont Recherche Management - ESC Clermont-Ferrand - École Supérieure de Commerce (ESC) - Clermont-Ferrand - UCA [2017-2020] - Université Clermont Auvergne [2017-2020]

Post-Print from HAL

Abstract: This paper examines the impact of dividend policy on earnings quality in the French context over the period 1994-2018. Using four measures of earnings quality, we find an inverted U-shaped relationship between dividend level and earnings quality. Dividend level positively influences earnings quality up to a certain payout level. Beyond this threshold, the dividend increase is detrimental to earnings quality. We also observe that the decrease in earnings persistence observed for high values of dividend ratios is explained by earnings management. Moreover, we find that the curvilinear relationship between dividend level and earnings quality is moderated for large firms and firms with volatile dividends. Our results in the French context extend the existing literature and reconcile the mixed results in previous research.

Keywords: Dividend policy; Earnings quality; Curvilinear relationship (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-acc and nep-cfn
Note: View the original document on HAL open archive server: https://hal.science/hal-04415679
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in Comptabilité Contrôle Audit / Accounting Auditing Control, In press

Downloads: (external link)
https://hal.science/hal-04415679/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04415679

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().