U.S. multinational corporations' income shifting incentives and share repurchases: Evidence across differential taxation systems

Eulaiwi, Baban; Alghamdi, Fatmah Saeed; Al-Hadi, Ahmed; Duong, Lien; Taylor, Grantley

doi:10.1016/j.gfj.2024.100966

Global Finance Journal

2024

DOI: 10.1016/j.gfj.2024.100966

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U.S. multinational corporations' income shifting incentives and share repurchases: Evidence across differential taxation systems

Baban Eulaiwi,

Fatmah Saeed Alghamdi,

Ahmed Al-Hadi

et al.

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2024

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A zero cash dividend policy: the UK experience

Baker,

Kilincarslan,

Demiralay

2024

Rev Quant Finan Acc

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We investigate the perceptions of corporate managers of non-dividend-paying firms listed on the London Stock Exchange (LSE) to identify the factors and explanations leading to a zero cash dividend policy. Our survey evidence shows that the main reasons for not paying dividends involve poor profitability, the firm’s life cycle stage and profitable growth opportunities. Managers consider shareholder preferences when setting a zero cash dividend policy, but neither taxes nor share repurchases (as substitutes for cash dividends) explain this policy. High insider ownership and transaction costs also do not explain why some UK companies pay no cash dividends. However, respondents confirm that the cost of raising new external funds (debt) is an important factor in not distributing cash dividends. Our results are inconclusive on the potential signaling effect of not paying dividends. Finally, the findings indicate that the COVID-19 pandemic did not affect the decision to follow a zero cash dividend policy in the United Kingdom.

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A zero cash dividend policy: the UK experience

Baker,

Kilincarslan,

Demiralay

2024

Rev Quant Finan Acc

View full text Add to dashboard Cite

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U.S. multinational corporations' income shifting incentives and share repurchases: Evidence across differential taxation systems

Cited by 1 publication

References 52 publications

A zero cash dividend policy: the UK experience

A zero cash dividend policy: the UK experience

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