This paper tests whether firms altered their dividend and share repurchase policies in response to the 2003 reductions … in shareholder tax rates. We predict that firms substituted dividends for repurchases, because the reduction in dividend … (particularly officers and managers) when setting dividend and share repurchase policies. …

from 38.1 percent to 15 percent. This study analyzes dividend declarations in the quarter following passage. Aggregate … dividends rose by 9 percent when boards of directors first met following enactment. Consistent with the dividend changes being … tax-motivated, they are increasing in the percentage of the firm held by individuals. Dividend changes also increased with …

dividend growth rates of the aggregate stock market. This approach aggregates information contained in the history of price-dividend … ratios and dividend growth rates to predict future returns and dividend growth rates. We find that returns and dividend … growth rates are predictable with R-squared values ranging from 8.2% to 8.9% for returns and 13.9% to 31.6% for dividend …