Sunday, April 11, 2010

Local Dividend Clienteles

Local Dividend Clienteles: We mention both ownership biases (similar to home country biases) as well as the dividend clientele effect in class, but I never suspected a relation strong enough to tie the two together, until now.

In an upcoming Journal of Finance article, Bo Becker, Zoran Ivkovic, and Scott Weisbenner do just that! They find:

"Firms headquartered in areas in which seniors constitute a large fraction of the population are more likely to pay dividends, initiate dividends, and have higher dividend yields."

Which will definitely make its way into class!

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