We analyze the valuation-tax avoidance relation and find there is, in fact, a market value discount for tax avoidance. We identify several channels for the adverse valuation effects of tax avoidance. Tax-avoiding firms that i) lack foreign income, ii) are financially constrained, and iii) incur...

We study the effect of ambiguity — Knightian uncertainty — on payout policy. We find that firm-level ambiguity increases and accelerates payout, via both dividends and share repurchases. This positive effect of ambiguity is distinct from the known negative effect of risk on payout policy....

For a sample of 28,895 firms across 30 countries and 29 years, there is a negative relation between dividend tax rates and dividend payout. Firms increase dividend payout in response to both absolute and relative (to capital gains tax rates) decreases in dividend tax rates. This negative...

Using more than 30 million quarterly observations on investment funds, firms, and directors, we show that equity-ownership relationships between funds and directors comove when new firms appoint these directors. Funds follow directors from high operating performance and high valuation firms to...

For a panel of 1,880 firms across 21 countries from 2004 to 2008, the impact of firm-level and country-level governance on payout policy is consistent with the La Porta et al. (2000) outcome model. In weak legal regimes, dividends increase in firm-level governance. In strong legal regimes,...