Dividends are an important means of paying shareholders. At the same time, dividends can drain resources useful to grow the business. Focusing on privately-owned family firms, we argue that an important and unexplored feature driving dividend payout is the dispersion of equity shares among family members. Due to potential differences in family owners’ priorities, we hypothesize that equity dispersion is positively associated with dividends. This relationship, however, is weaker for firms led by a family member, first-generation firms, and firms in uncertain industry contexts. Our empirical analysis supports these hypotheses.

Family ownership dispersion and dividend payout in family firms

Amore, Mario Daniele;Quarato, Fabio;Corbetta, Guido
2022

Abstract

Dividends are an important means of paying shareholders. At the same time, dividends can drain resources useful to grow the business. Focusing on privately-owned family firms, we argue that an important and unexplored feature driving dividend payout is the dispersion of equity shares among family members. Due to potential differences in family owners’ priorities, we hypothesize that equity dispersion is positively associated with dividends. This relationship, however, is weaker for firms led by a family member, first-generation firms, and firms in uncertain industry contexts. Our empirical analysis supports these hypotheses.
2021
Miller, Danny; Amore, Mario Daniele; Quarato, Fabio; Corbetta, Guido
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11565/4039351
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