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Do multinational firms respond to personal dividend income tax rates?

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  • M. Jonathan C. Eklund

    (University of Tuebingen)

Abstract

This study examines the effect of investor-level income taxes on profit repatriation and dividend payout policies of multinational firms. The empirical estimations include two million firm-year observations in 130 countries. By augmenting the Lintner model of dividend payments, I employ parametric as well as semiparametric techniques to provide evidence that income taxes on dividends neither alter dividend payments to investors nor within-firm dividend payments. These results remain robust to a wide range of alternative specifications.

Suggested Citation

  • M. Jonathan C. Eklund, 2022. "Do multinational firms respond to personal dividend income tax rates?," Empirical Economics, Springer, vol. 62(4), pages 1743-1771, April.
    • Handle: RePEc:spr:empeco:v:62:y:2022:i:4:d:10.1007_s00181-021-02088-2
    DOI: 10.1007/s00181-021-02088-2
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