The tax implications of dividend policy on a firm's equity value continues to be a controversial issue in corporate finance. Although some studies indicate that taxes only weakly affect corporate managers' dividend policy decisions, other evidence suggests that investors react to dividend...

This study examines the wealth effects to U.S. target firms observed at the announcement of acquisition bids made by foreign and U.S. bidders. We hypothesize that if the market expects foreign bidders to produce superior takeover gains, the announcement-related excess returns of the targets will...