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- All HBS Web (17)
- Faculty Publications (4)
Show Results For
- All HBS Web (17)
- Faculty Publications (4)
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- 2021
- Working Paper
Investment as the Opportunity Cost of Dividend Signaling
By: Zach Kaplan and Gerardo Pérez Cavazos
We provide evidence that firms with weak investment opportunities (those whose current earnings justify a greater valuation than firms with strong investment opportunities) signal their permanent earnings level through their dividends. In the cross-section, we show... View Details
- May 2022
- Article
Investment as the Opportunity Cost of Dividend Signaling
By: Zach Kaplan and Gerardo Pérez Cavazos
We provide evidence that firms with weak investment opportunities (those whose current earnings justify a greater valuation than firms with strong investment opportunities) signal their permanent earnings level through their dividends. In the cross-section, we show... View Details
Keywords: Dividends; Earnings; Investment Opportunities; Payout Policy; Signaling; Capital Structure; Business Earnings; Investment; Opportunities
Kaplan, Zach, and Gerardo Pérez Cavazos. "Investment as the Opportunity Cost of Dividend Signaling." Accounting Review 97, no. 3 (May 2022): 279–308.
Signaling with Dividends
We outline a dividend signaling model that features investors who are behaviorally averse to dividend cuts. Managers with strong unobservable cash earnings separate by paying high dividends but retain enough to be likely not to fall short next period. The model is... View Details
- 17 Aug 2012
- Working Paper Summaries
Dividends as Reference Points: A Behavioral Signaling Approach
Keywords: by Malcolm Baker & Jeffrey Wurgler
- March 2016
- Article
Dividends as Reference Points: A Behavioral Signaling Approach
By: Malcolm Baker, Brock Mendel and Jeffrey Wurgler
We outline a dividend signaling model that features investors who are averse to dividend cuts. Managers with strong unobservable cash earnings separate by paying high dividends but retain enough to be likely not to fall short next period. The model is consistent with a... View Details
Keywords: Investment
Baker, Malcolm, Brock Mendel, and Jeffrey Wurgler. "Dividends as Reference Points: A Behavioral Signaling Approach." Review of Financial Studies 29, no. 3 (March 2016): 697–738.
- 07 Feb 2007
- Research & Ideas
Dividends from Schumpeter’s Noble Failure
neglected classic, because the book is not a classic. Instead, Business Cycles is a noble failure that paid unexpected dividends both to the author and to scholarship. A link to the full version of this article from Business History... View Details
Keywords: by Thomas K. McCraw
- 28 Apr 2014
- Working Paper Summaries
Payout Policy
- 20 Feb 2008
- First Look
First Look: February 20, 2008
could prevent if we only knew what to look for. This book plays on that fear and offers a positive, proactive resolution to it. Two leading experts in managerial decision making show that many disasters in business are preceded by clear warning View Details
Keywords: Martha Lagace
- Web
Behavioral Finance & Financial Stability
households’ stock holdings, the authors find that unrealized capital gains lead to a marginal propensity to consume of 23% for the bottom 50% of the wealth distribution and about 3% for the top 30% of the wealth distribution. Household consumption is significantly more... View Details
- Web
Business Finance Course Online | HBS Online
understanding of the players in the financial services industry and contemplate the financial system, its flaws, and potential solutions. Highlights Institutional Investors Signaling Tops Friendly Market Show Hide Details Concepts Capital... View Details
- Web
Research - Behavioral Finance & Financial Stability
wealth distribution and about 3% for the top 30% of the wealth distribution. Household consumption is significantly more responsive to dividend payouts. See Marco’s other research here , Amir’s other research here , and Kaven’s other... View Details
- 01 Dec 2022
- News
My First Job
the leaders, entrepreneurs, and innovators that we become later in life, paying dividends that far exceed any minimum-wage salary. Here, alumni share stories about their entry-level errors, as well as the personal and professional... View Details
- 07 Aug 2012
- First Look
First Look: August 7
patients. Download the paper: http://papers.nber.org/papers/W18202 Dividends as Reference Points: A Behavioral Signaling Approach Authors:Malcolm Baker and Jeffrey Wurgler Abstract We outline a View Details
Keywords: Sean Silverthorne
- 08 Sep 2009
- Research & Ideas
The Height Tax, and Other New Ways to Think about Taxation
fair strategies in public finance? A: Tax economists generally point to a few things about current taxes that seem unwise. Probably foremost among them is the taxation of capital income, such as dividends and capital gains. There is a... View Details
Keywords: by Martha Lagace
- 25 Apr 2005
- Research & Ideas
New Learning at American Home Products
dividends increased every year. This highly successful strategy and its resulting financial performance harbored one potential flaw. Over the decades the company had built impressive capabilities in production, and, more important,... View Details
- 28 Jul 2015
- First Look
First Look: July 28, 2015
individuals make decisions in an operations management setting when there is information asymmetry among the participants. Common equilibrium assumptions yield the least cost separating outcome as the unique equilibrium. In this equilibrium, the more informed party... View Details
Keywords: Carmen Nobel
- 01 Jun 2010
- News
$how Me the Money
say, ‘I’m not allowed to bribe.’ Others prefer ambiguous instructions so they can do what they have to do to get the business and keep up with the competition.” But managing in such a culture where signals are mixed can be a tricky... View Details