Propensity to pay dividends and CEO reputation

Danai Likitratcharoen, Pornsit Jiraporn, Tatchawan Kanitpong

Research output: Contribution to journalArticle

Abstract

Over the past decades, there have been numerous discussions about the influence of dividends and firm's value. If dividends have an influence on the firm's value, then it is worth exploring the factors that have an influence on dividends. The purpose of this research is to test the association between firm's propensity to pay dividends and firm's CEO reputation while controlling for firm size, market-to-book ratio, leverage, R&D spending, capital expenditures, CEO tenure, year dummies, and industry dummies. Press coverage (media counts) are used to proxy for CEO reputation. The results from logistic regression show that firms with higher reputable CEOs have lower propensity to pay dividends. These results support the investment hypothesis that CEOs with higher reputation tend to be more aggressive and use the funds to make more investment rather than paying out dividends. These results are important because they show that a managerspecific attribute, i.e. reputation, has a significant impact on a crucial corporate outcome - the extent of corporate dividend payouts.

Original languageEnglish (US)
Pages (from-to)82-88
Number of pages7
JournalEuropean Journal of Scientific Research
Volume82
Issue number1
StatePublished - Jan 1 2012

Fingerprint

news media
Dividend
Capital Expenditures
markets
industry
Proxy
Financial Management
Logistics
Industry
Logistic Models
testing
firm size
Research
expenditure
logistics
Logistic Regression
Reputation
firm
Leverage
market

All Science Journal Classification (ASJC) codes

  • Computer Science(all)
  • Mathematics(all)
  • Materials Science(all)
  • Agricultural and Biological Sciences(all)
  • Engineering(all)
  • Earth and Planetary Sciences(all)

Cite this

Likitratcharoen, Danai ; Jiraporn, Pornsit ; Kanitpong, Tatchawan. / Propensity to pay dividends and CEO reputation. In: European Journal of Scientific Research. 2012 ; Vol. 82, No. 1. pp. 82-88.
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Likitratcharoen, D, Jiraporn, P & Kanitpong, T 2012, 'Propensity to pay dividends and CEO reputation', European Journal of Scientific Research, vol. 82, no. 1, pp. 82-88.

Propensity to pay dividends and CEO reputation. / Likitratcharoen, Danai; Jiraporn, Pornsit; Kanitpong, Tatchawan.

In: European Journal of Scientific Research, Vol. 82, No. 1, 01.01.2012, p. 82-88.

Research output: Contribution to journalArticle

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