Two essays examining the information content of dividend policy: I. The role of growth opportunities in the dividend initiation (omission) decision for NASDAQ firms. II. A further examination of the information content of specially designated dividends.

摘要

This two essay dissertation further examines the information content of changes in dividend policy. The first essay concentrates on the examination of initiation and omission of dividend payments for NASDAQ firms. The second essay provides a further examination of the information content of specially designated dividends. Both essays utilized an improved event study methodology that examines both the wealth and variance effects at the time of the announcement of the dividend decision. The first essay provides additional analysis via cross-sectional weighted least squares regression while the second essay examines security analysts' forecast revisions following the special dividend announcement to further examine the signal sent by management. The results of both essays provide strong support for the general information signaling hypothesis in the corporate dividend decision. In the examination of NASDAQ dividend initiations and omissions, there is also limited support for the free cash flow hypothesis.