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Does the catering theory of dividend apply to the French listed firms?

Author

Listed:
  • Kamal Anouar

    (GRM - Groupe de Recherche en Management - EA 4711 - UNS - Université Nice Sophia Antipolis - UCA - Université Côte d'Azur - IAE Toulon - Institut d'Administration des Entreprises (IAE) - Toulon - Institut d'Administration des Entreprises (IAE) - Nice - UTLN - Université de Toulon)

  • Nicolas Aubert

    () (CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon)

Abstract

This paper tests the catering theory of dividend in the French market. It investigates how prevailing investor's demand for dividend payers proxied by the dividend premia affects the dividend policy. The dividend premia are measured at the market level and at the firm level. We find that the market demand for dividends measured by dividend premia affects the decision to start, to continue or to omit to pay dividends and the decision to increase the dividends. However, catering theory does not seem to affect the magnitude of the dividend changes since most results are not significant.

Suggested Citation

  • Kamal Anouar & Nicolas Aubert, 2016. "Does the catering theory of dividend apply to the French listed firms?," Post-Print halshs-01401867, HAL.
  • Handle: RePEc:hal:journl:halshs-01401867
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01401867
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Behavioral corporate; finance; Catering; Dividend premium; Dividends; Payout policy;

    JEL classification:

    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles
    • G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy

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