substitution hypothesis and the dividend clientele effect: High dividend paying companies have smaller positive price reactions … than non-or lower dividend paying companies. …

This paper investigates the impact of the 2001 tax reform in Germany on dividend announcement returns. With this major … market response to positive dividend surprises is more pronounced under the full imputation system, where dividends are … observed decline in the dividend response coefficient is synchronized with the 2001 tax reform and hence attributable to the …