Dividend Tax Capitalization: Clarifications and Responses to Recent Challenges
AbstractRecent studies by Dhaliwal et al. (2001) and Hanlon, Myers, and Shevlin (2001) raise questions regarding the dividend tax capitalization results in several of my prior studies. In this paper, I clarify the basic concepts underlying dividend tax capitalization and I provide point-by-point responses to the key concerns raised. I demonstrate that there are simple, unambiguous answers to each of the expressed concerns. I also demonstrate that the new evidence provided by Dhaliwal et al. (2001) and Hanlon, Myers, and Shevlin (2001) actually provides addtional support for dividend tax capitalization.
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Bibliographic InfoPaper provided by Yale School of Management in its series Yale School of Management Working Papers with number ysm216.
Date of creation: 13 Aug 2001
Date of revision:
Find related papers by JEL classification:
- G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
- G12 - Financial Economics - - General Financial Markets - - - Asset Pricing
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- Hanlon, Michelle & Myers, James N. & Shevlin, Terry, 2003. "Dividend taxes and firm valuation:: a re-examination," Journal of Accounting and Economics, Elsevier, vol. 35(2), pages 119-153, June.
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