Abnormal Retained Earnings Around The World

Paulo Alves and Paulo Silva

MPRA Paper from University Library of Munich, Germany

Abstract: Using a firm-level survey database covering 50 countries we evaluate firms´ abnormal retained earnings. The results of our work indicate that firms located in emerging markets retain more earnings than firms from developed countries. On the other hand, firms located on common law based countries retain earnings above the expected and higher than firms placed on civil law based countries. A possible explanation, according to our results, can be seen in the economic growth that these countries have shown in the past 20 years. The financial crisis of 2008 and its impact in the abnormal retained earnings can help to validate this result. Finally, we would like to draw attention upon the impact of the firms´ size on abnormal retained earnings. According to our results this relationship is positive. This strongly questions the growth of smaller companies.

Keywords: Abnormal retained earnings; Financing choices; Institutional environment; Small firms. (search for similar items in EconPapers)
JEL-codes: G31 G34 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-bec and nep-cfn
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https://mpra.ub.uni-muenchen.de/80243/1/MPRA_paper_80243.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/83174/1/MPRA_paper_83174.pdf revised version (application/pdf)

Related works:
Journal Article: Abnormal retained earnings around the world (2018)
Working Paper: Abnormal Retained Earnings Around the World (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:80243

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