Abstract
Our study investigates the influence of national culture on corporate dividend policy by considering Schwartz’s two cultural dimensions: harmony and hierarchy. The main motivation of the analysis is that people decisions are driven by their feelings and emotions, and these subjective factors can be as relevant as the objective companies’ factors when looking at dividend policy decisions. Using a database of 10,878 companies from 56 countries, for the period 2008–2014, we find that national harmony is positively related, and hierarchy negatively related to the dividend payout ratio. The local culture seems to be significantly associated with the dividend payout ratio.
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Notes
- 1.
The data were collected from the platform provided by Deloitte Management Consulting in Romania. Relatively the same database is used, in a different context, in Yaseen (2019).
- 2.
These countries are: Argentina, Australia, Austria, Belgium, Brazil, Bulgaria, Canada, Chile, China, Croatia, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Germany, Ghana, Greece, Hong Kong, Hungary, India, Indonesia, Ireland, Israel, Italy, Japan, Latvia, Macedonia, Malaysia, Mexico, Netherlands, New Zeeland, Norway, Oman, Pakistan, Peru, Philippines, Poland, Portugal, Romania, Russia, Serbia, Slovenia, South Africa, South Korea, Spain, Sweden, Switzerland, Thailand, Turkey, Ukraine, United Kingdom, USA, Venezuela, Zimbabwe.
- 3.
Propensity to pay dividends (Denis and Osobov 2008) is calculated as percentage of companies that distributed dividends in 2014 reported to the total number of companies in that country in 2014 in our database.
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Acknowledgements
The authors would like to thank for helpful comments provided by the anonymous reviewer from The Annual Conference on Finance and Accounting, ACFA 2018. All opinions expressed are those of the authors and any remaining errors are theirs.
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Yaseen, H., Dragotă, V. (2019). Harmony, Hierarchy and Dividend Policy Around the World. In: Procházka, D. (eds) Global Versus Local Perspectives on Finance and Accounting. ACFA2018 2018. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-030-11851-8_11
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