The impact of payout policy changes on firm value and short selling activities across different taxation regimes (ARC DP administered by La Trobe University)

Abstract:: Brealey et al (2011) assert that we don't know enough yet about how payout policy varies across firms. We examine the information content of dividend changes and repurchase programs and the long-term market impact of these announcements, controlling for the substitution effect of repurchases/dividends in different institutional/tax regimes. We also examine whether short sellers manifest abnormal behaviour around the announcement of dividend changes and repurchase programs, and whether earnings are manipulated upwards to maintain the dividend or downwards prior to the announcement of repurchase programs. Findings will be of major interest to academics, managers, investors and regulators.
Grant type:: La Trobe University
Funded by:: La Trobe University

The University of Queensland