Which Types of Firms React More to a Tax Cut? Evidence from the 2003 Dividend Tax Cut
2012/08/14
研討會日期 : 2012-08-14
時間 : 14:30
主講人 : Professor Tat-Kei Lai
地點 : Conference Room B110
演講者簡介 : Tat-Kei Lai received his Ph.D. in Economics from University of Toronto in 2011. He is currently serving as Assistant Professor of Economics at Copenhagen Business School. His research field is in industrial organization, corporate finance, and labor economics.
演講摘要 : The agency model of Chetty and Saez (2010) predicts that firms with stronger corporate governance are more responsive to a dividend tax cut in their dividend and investment policies. We test these predictions by exploiting the sudden and significant dividend tax cut following the Jobs and Growth Tax Relief Reconciliation Act of 2003 and the pre-tax cut variation in corporate governance standards across firms. We find that firms with stronger corporate governance raise dividends and reduce investment in response to the tax cut significantly more than firms with weaker corporate governance. These differential reactions come from differences in corporate governance standards but not differences in ownership concentration ratios.
