Peer-Reviewed Journal Details
Mandatory Fields
Byrne J.;O'Connor T.
2017
March
Journal of Multinational Financial Management
Creditor rights, culture and dividend payout policy
Published
8 ()
Optional Fields
Creditor rights Dividend policy National culture
39
60
77
© 2016 Elsevier B.V. We study how creditor rights and culture interact with one another to influence corporate dividend payout policy. Where creditor rights are strong, creditors accept the status quo, which are large dividends in individualist and small dividends in collectivist traditions, respectively. Culture influences dividend payout where creditor rights are weak. In collectivist countries where group cohesion among corporate stakeholders results in perceived lower agency costs of debt and equity, creditors place few if any restrictions on dividend payout given weak creditor rights. In contrast, in individualist traditions, creditors continue to restrict dividend payouts under weak creditor rights. Our findings emphasize the importance of accounting for the interactions between creditor rights and culture in determining dividend policy.
1042-444X
10.1016/j.mulfin.2016.12.002
Grant Details