Please use this identifier to cite or link to this item: https://ktisis.cut.ac.cy/handle/10488/10967
Title: Large dividend increases and leverage
Authors: Cooper, Ian A. 
Lambertides, Neophytos 
Major Field of Science: Social Sciences
Field Category: Economics and Business
Keywords: Capital structure;Dividend policy;Dividend changes;Leverage
Issue Date: Feb-2018
Source: Journal of Corporate Finance, 2018, vol. 48, pp. 17-33
Volume: 48
Start page: 17
End page: 33
Journal: Journal of Corporate Finance 
Abstract: This study documents the fact that large dividend increases are followed by a significant increase in leverage, consistent with management increasing the dividend to use up excess debt capacity. However, the leverage increase is not captured by a standard partial adjustment model of leverage. Nor does it reflect variables known to be related to dividend increases, such as firm maturity, investment, and risk. Instead, the dividend increase signals a complex change in the way firms adjust to their leverage target, but it does not signal a change in the target.
ISSN: 0929-1199
DOI: 10.1016/j.jcorpfin.2017.10.011
Rights: © Elsevier
Type: Article
Affiliation : London Business School 
Cyprus University of Technology 
Appears in Collections:Άρθρα/Articles

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