Dividends and profits: some unstable foreign influences
Article Abstract:
American corporations earn a significant share of their profits from foreign sources, out of which they appear to pay dividends at rates that are three times higher than their payout rates from domestic profits. Why firms do so is unclear, although this behavior is consistent with the use of dividends to signal profitability. This payout behavior implies that a significant part of the U.S. tax revenue generated by the foreign profits of U.S. corporations arises through the taxation of dividends received by individuals, and that the cost of capital may be higher for foreign than for domestic operations. (Reprinted by permission of the publisher.)
Publication Name: Journal of Finance
Subject: Business
ISSN: 0022-1082
Year: 1996
User Contributions:
Comment about this article or add new information about this topic:
Are Firms Underleveraged? An Examination of the Effect of Leverage on Default Probabilities
Article Abstract:
An instrumental variable method shows that the impact of leverage on corporate ratings is significantly stronger than it is if leverage endogeneity is ignored. Implications for the ex ante costs of a firm's financial distress versus calculations of tax benefits incurred from debt are discussed.
Publication Name: Journal of Finance
Subject: Business
ISSN: 0022-1082
Year: 2005
User Contributions:
Comment about this article or add new information about this topic:
Internal versus external financing: an optimal contracting approach
Article Abstract:
The advantages and disadvantages of centralized contracting are discussed.
Publication Name: Journal of Finance
Subject: Business
ISSN: 0022-1082
Year: 2003
User Contributions:
Comment about this article or add new information about this topic: