Purpose – The purpose of this paper is to examine the dynamic relationships among investment, earnings and dividends for US firms. The sample period is 1950-2006. Design/methodolgy/approach - The authors use a firm-level vector auto-regression (VAR) framework to examine the firm-level dynamics...

Purpose – The purpose of this paper is to examine the dynamic relationships among investment, earnings and dividends for US firms. The sample period is 1950-2006. Design/methodology/approach – The authors use a firm-level vector auto-regression (VAR) framework to examine the firm-level...