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Dividend irrelevance and firm control

Steven A. Dennis & William S. Smith

Research in Finance2014https://doi.org/10.1108/s0196-3821_2014_0000030010book-chapter
ABDC C
Weight
0.26

What the paper says

We examine the ability of co-founders of a firm to create an artificial (or “homemade”) dividend as in Miller and Modigliani (1961). We employ traditional discounted valuation in showing that the act of creating an artificial dividend may decrease the value of the firm because it can divert funds from investment to the consumption of perquisites. Only where there is complete trust in the party to which the shares are sold can a co-founder costlessly create an artificial dividend. It seems likely that a dividend policy, idiosyncratic to the firm’s founders, would be established at the founding of the firm.

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Cite this paper

https://doi.org/https://doi.org/10.1108/s0196-3821_2014_0000030010

Or copy a formatted citation

@article{steven2014,
  title        = {{Dividend irrelevance and firm control}},
  author       = {Steven A. Dennis & William S. Smith},
  journal      = {Research in Finance},
  year         = {2014},
  doi          = {https://doi.org/https://doi.org/10.1108/s0196-3821_2014_0000030010},
}

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Dividend irrelevance and firm control

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Evidence weight

0.26

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.00 × 0.4 = 0.00
M · momentum0.20 × 0.15 = 0.03
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.