Flexible firm-level dividends in Latin America
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Date
2017-02-20
Authors
von Eije, Henk
Goyal, Abhinav
Muckley, Cal B.
Journal Title
Journal ISSN
Volume Title
Publisher
Elsevier
Published Version
Abstract
We show, for a sample of up to 757 industrial firms, in seven Latin American countries from 1994–2014, that these firms exhibit comparatively flexible payout behavior. Flexibility is defined in respect to (i) variability in firm payout status and amounts and (ii) parameters of the Lambrecht-Myers (2012) theory on the Lintner (1956) dividend equation. The results indicate that Latin American firms have higher speeds of adjustment and target payout ratios as well as lower rates of habit formation than found in the payout policies of United States firms. This note, thus, highlights an open question regarding conspicuously flexible payout policies in Latin American firms.
Description
Keywords
Dividends , Flexibility , Latin America
Citation
von Eije, H., Goyal, A. and Muckley, C. B. (2017) 'Flexible firm-level dividends in Latin America', Finance Research Letters, 23, pp. 133-136. doi: 10.1016/j.frl.2017.02.012