Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning

We propose a rational signalling model to investigate the information content of dividends. The model provides a direct test on the relation between unexpected dividend and earnings changes. In identifying the component of unexpected dividend changes, we suggest an expectations framework that accoun...

Full description

Saved in:

Bibliographic Details
Main Authors:	WU, Chunchi, Kao, C.
Format:	text
Language:	English
Published:	Institutional Knowledge at Singapore Management University 1994
Subjects:	Business
Online Access:	https://ink.library.smu.edu.sg/lkcsb_research/804
Tags:	Add Tag No Tags, Be the first to tag this record!
Institution:	Singapore Management University
Language:	English

id	sg-smu-ink.lkcsb_research-1803
record_format	dspace
spelling	sg-smu-ink.lkcsb_research-18032010-09-23T06:24:04Z Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning WU, Chunchi Kao, C. We propose a rational signalling model to investigate the information content of dividends. The model provides a direct test on the relation between unexpected dividend and earnings changes. In identifying the component of unexpected dividend changes, we suggest an expectations framework that accounts for the process of dividend adjustment to firms' permanent earnings. A nonlinear regression method is used to estimate the model and test the rationality and signalling hypotheses. Consistent with Healy and Palepu's (1988) findings, the results show that dividends reflect past, current and future earnings information. [ABSTRACT FROM AUTHOR] 1994-01-01T08:00:00Z text https://ink.library.smu.edu.sg/lkcsb_research/804 Research Collection Lee Kong Chian School Of Business eng Institutional Knowledge at Singapore Management University Business
institution	Singapore Management University
building	SMU Libraries
continent	Asia
country	Singapore Singapore
content_provider	SMU Libraries
collection	InK@SMU
language	English
topic	Business
spellingShingle	Business WU, Chunchi Kao, C. Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning
description	We propose a rational signalling model to investigate the information content of dividends. The model provides a direct test on the relation between unexpected dividend and earnings changes. In identifying the component of unexpected dividend changes, we suggest an expectations framework that accounts for the process of dividend adjustment to firms' permanent earnings. A nonlinear regression method is used to estimate the model and test the rationality and signalling hypotheses. Consistent with Healy and Palepu's (1988) findings, the results show that dividends reflect past, current and future earnings information. [ABSTRACT FROM AUTHOR]
format	text
author	WU, Chunchi Kao, C.
author_facet	WU, Chunchi Kao, C.
author_sort	WU, Chunchi
title	Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning
title_short	Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning
title_full	Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning
title_fullStr	Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning
title_full_unstemmed	Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning
title_sort	rational expectations, information signalling and dividend adjustment to permanent earning
publisher	Institutional Knowledge at Singapore Management University
publishDate	1994
url	https://ink.library.smu.edu.sg/lkcsb_research/804
_version_	1770569707913478144

Rational Expectations, Information Signalling and Dividend Adjustment to Permanent Earning

Similar Items