Disappearing Dividends: Changing Firm Characteristics or Lower Propensity to Pay? (1999)
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BibTeX
@MISC{Fama99disappearingdividends:,
author = {Eugene F. Fama and Eugene F. Fama and Kenneth R. French and Kenneth R. French and Andrei Shleifer and Paul Zarowin and Two Anonymous and Seminar Participants},
title = {Disappearing Dividends: Changing Firm Characteristics or Lower Propensity to Pay?},
year = {1999}
}
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Abstract
The percent of firms paying cash dividends falls from 66.5 in 1978 to 20.8 in 1999. The decline is due in part to the changing characteristics of publicly traded firms. Fed by new lists, the population of publicly traded firms tilts increasingly toward small firms with low profitability and strong growth opportunities -- characteristics typical of firms that have never paid dividends. More interesting, we also show that controlling for characteristics, firms become less likely to pay dividends. This lower propensity to pay is at least as important as changing characteristics in the declining incidence of dividend payers. * Graduate School of Business, University of Chicago (Fama) and Sloan School of Management, MIT (French). We acknowledge the comments of John Graham, Douglas Hannah, Anil Kashyap, Tobias Moskowitz, G. William Schwert, Andrei Shleifer, Paul Zarowin, two anonymous (and especially helpful) referees, and seminar participants at Harvard University, the University of Chica...
