DIVIDEND POLICIES, LEGAL REGIMES AND INSTITUTIONAL STRUCTURES IN THE ASIA PACIFIC REGION

摘要

This study sets out to test two agency theories of dividend payments. The first model, known as the 'outcome' model, claims that dividends are the result of effective legal protection of shareholders, who are able to extract payments from firms. The second model, known as the 'substitute' model, argues that dividends are a substitute for the monitoring roles of the stakeholders. This study uses aggregate data from eleven Asia Pacific countries. The results are consistent with the 'outcome' model, which predicts that dividend payouts by firms operating in strong legal environments are higher, stickier and less sensitive to changes in current earnings.