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Did Firms Substitute Dividends for Share Repurchases after the 2003 Reductions in Shareholder Tax Rates?

Shackelford, Douglas A.; Blouin, Jennifer L.; Raedy, … - National Bureau of Economic Research (NBER) - 2007

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. …

Persistent link: https://www.econbiz.de/10005720020

Did Dividends Increase Immediately After the 2003 Reduction in Tax Rates?

Shackelford, Douglas A.; Blouin, Jennifer L.; Raedy, … - National Bureau of Economic Research (NBER) - 2004

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 …

Persistent link: https://www.econbiz.de/10005714818

Capital Gains Taxes and Stock Reactions to Quarterly Earnings Announcements

Shackelford, Douglas A.; Blouin, Jennifer L.; Raedy, … - National Bureau of Economic Research (NBER) - 2000

This paper examines the impact of capital gains taxes on equity pricing. Examining three-day cumulative abnormal returns for quarterly earning announcements from 1983-1997, we present evidence consistent with shareholders' capital gains taxes affecting stock price responses. To our knowledge,...

Persistent link: https://www.econbiz.de/10005717980

The Impact of Capital Gains Taxes on Stock Price Reactions to S&P 500 Inclusion

Shackelford, Douglas A.; Blouin, Jennifer L.; Raedy, … - National Bureau of Economic Research (NBER) - 2000

This paper contributes to our understanding of the determinants of price responses to inclusion in the S&P 500 by providing evidence consistent with capital gains tax planning impacting stock reactions. Tests are conducted on 426 additions from 1978-1999. We regress the returns on the first...

Persistent link: https://www.econbiz.de/10005580434

Capital Gains Holding Periods and Equity Trading: Evidence from the 1998 Tax Act

Shackelford, Douglas A.; Blouin, Jennifer L.; Raedy, … - National Bureau of Economic Research (NBER) - 2000

This paper exploits an unusually powerful setting to explore a choice many individual investors face regularly the decision to sell today or postpone selling until lower rates are available in the future. We examine trading volume and stock returns around the 1998 reduction in the holding period...

Persistent link: https://www.econbiz.de/10005580686

Trade Credit and Taxes

Hines, James R. Hines, Jr.; Desai, Mihir A.; Foley, C. Fritz - National Bureau of Economic Research (NBER) - 2012

This paper analyzes the extent to which firms use trade credit to reallocate capital in response to tax incentives. Tax-induced differences in pretax returns encourage the use of trade credit to reallocate capital from firms facing low tax rates to those facing high tax rates. Evidence from the...

Persistent link: https://www.econbiz.de/10011271378

Watch What I Do, Not What I Say: The Unintended Consequences of the Homeland Investment Act

Dharmapala, Dhammika; Forbes, Kristin; Foley, C. Fritz - National Bureau of Economic Research (NBER) - 2009

This paper analyzes the impact on firm behavior of the Homeland Investment Act of 2004, which provided a one-time tax holiday for the repatriation of foreign earnings by U.S. multinationals. The analysis controls for endogeneity and omitted variable bias by using instruments that identify the...

Persistent link: https://www.econbiz.de/10005025649

Chains of Ownership, Regional Tax Competition, and Foreign Direct Investment

Hines, James R. Hines, Jr.; Desai, Mihir A.; Foley, C. Fritz - National Bureau of Economic Research (NBER) - 2002

This paper considers the effect of taxation on the location of foreign direct investment (FDI) and taxable income reported by multinational firms with particular attention to the regional dynamics of tax competition and the role of chains of ownership. Confidential affiliate-level data are used...

Persistent link: https://www.econbiz.de/10005777573

A Multinational Perspective on Capital Structure Choice and Internal Capital Markets

Hines, James R. Hines, Jr.; Desai, Mihir A.; Foley, C. Fritz - National Bureau of Economic Research (NBER) - 2003

This paper examines the impact of local tax rates and capital market conditions on the level and composition of borrowing by foreign affiliates of American multinational corporations. The evidence indicates that 10 percent higher local tax rates are associated with 2.8 percent higher debt/asset...

Persistent link: https://www.econbiz.de/10005575521

Why do firms hold so much cash? A tax-based explanation

Titman, Sheridan; Foley, C. Fritz; Hartzell, Jay C.; … - National Bureau of Economic Research (NBER) - 2006

U.S. corporations hold significant amounts of cash on their balance sheets, and these cash holdings have been justified in the existing empirical literature by transaction costs and precautionary motives. An additional explanation, considered in this study, is that U.S. multinational firms hold...

Persistent link: https://www.econbiz.de/10005588918