Dividend policy relevance in a levered firm—The binomial case

Dan Galai; Zvi Wiener

doi:https://doi.org/10.1016/j.econlet.2018.08.021

Dividend policy relevance in a levered firm—The binomial case

Dan Galai, Zvi Wiener

BA Business Department

The Hebrew University of Jerusalem

Research output: Contribution to journal › Article › peer-review

Abstract

In this paper we illustrate a world with perfect capital markets and with no taxes, and show the condition under which the stockholders in a levered firm will be (un-) affected by the dividend policy. We illustrate it for a firm's value which follows the binomial distribution.

Original language	English
Pages (from-to)	78-80
Number of pages	3
Journal	Economics Letters
Volume	172
DOIs	https://doi.org/10.1016/j.econlet.2018.08.021
State	Published - Nov 2018

Keywords

Binomial contingent claim model
Corporate debt
Dividend policy

All Science Journal Classification (ASJC) codes

Finance
Economics and Econometrics

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https://doi.org/10.1016/j.econlet.2018.08.021

Cite this

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title = "Dividend policy relevance in a levered firm—The binomial case",

abstract = "In this paper we illustrate a world with perfect capital markets and with no taxes, and show the condition under which the stockholders in a levered firm will be (un-) affected by the dividend policy. We illustrate it for a firm's value which follows the binomial distribution.",

keywords = "Binomial contingent claim model, Corporate debt, Dividend policy",

author = "Dan Galai and Zvi Wiener",

note = "Publisher Copyright: {\textcopyright} 2018 Elsevier B.V.",

year = "2018",

month = nov,

doi = "https://doi.org/10.1016/j.econlet.2018.08.021",

language = "الإنجليزيّة",

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AU - Galai, Dan

AU - Wiener, Zvi

PY - 2018/11

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AB - In this paper we illustrate a world with perfect capital markets and with no taxes, and show the condition under which the stockholders in a levered firm will be (un-) affected by the dividend policy. We illustrate it for a firm's value which follows the binomial distribution.

KW - Binomial contingent claim model

KW - Corporate debt

KW - Dividend policy

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U2 - https://doi.org/10.1016/j.econlet.2018.08.021

DO - https://doi.org/10.1016/j.econlet.2018.08.021

M3 - مقالة

SN - 0165-1765

VL - 172

SP - 78

EP - 80

JO - Economics Letters

JF - Economics Letters

ER -

Dividend policy relevance in a levered firm—The binomial case

Abstract

Keywords

All Science Journal Classification (ASJC) codes

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