Local Culture and Dividends

Abstract

I empirically investigate whether geographical variations in local culture, as proxied by local religion, affect dividend demand and corporate dividend policy for a large sample of US firms. Firms located in Protestant counties are more likely to be dividend payers, initiate dividends, and have higher dividend yields, while firms located in Catholic counties are less likely to be dividend payers and have lower dividend yields. There is a geographically varying dividend clientele effect consistent with the variations in risk aversion among different cultural groups. My results suggest that firms largely held by local investors determine their corporate policies in line with local culture.

Increasing youth awareness of local culture through active learning

“…Local culture is something that is complex and has characteristics that are manifested through language, customs, beliefs, traditions, clothing, lifestyle, art, and morals (Kanoksilapatham, 2020); (Lin et al, 2018). This is in keeping with what Ucar states, that local culture is the main determining factor that encourages one to make decisions that are different from others (Ucar, 2016). Unfortunately, the value gained from local cultural wisdom is no longer a referent for Indonesian youth.…”

The effect of corporate environmental responsibility and religiosity on corporate cash holding decisions and profitability: Evidence from the United States' policies for sustainable development

“…Table 1 summarizes the descriptive statistics and correlation for each of our study variables. The value for all model variables are consistent with the results of previous studies (Chang et al, 2014;Opler et al, 1999;Ucar, 2016). Our sample includes considerable variations with regards to CER, religiosity, return on assets (ROA), and cash holdings.…”

“…Following previous studies, we add several firm-level control variables, including firm size, leverage, Tobin's Q, cash flow (CFO), the standard deviation of the CFO, net working capital, dividend, acquisitions, capital expenditure, research and development (R&D) expenses, property, plant, and equipment (PPENT), and the natural logarithm of the firm's age (Opler et al, 1999;Chang et al, 2014). We also control state-level demographic characteristics for the number of seniors present in the area, median house value, median income, education, and the natural logarithm of the population size (Ucar, 2016). Definitions for each variable are provided in the Appendix A.…”

Excess corporate payouts and financial distress risk

“…A firm's payout policy is also influenced by its peers (Grennan, 2019), its geographic location (John et al, 2011;Ucar, 2016), and local shareholder clientele (Becker et al, 2011), while neighbouring firms can significantly influence firms' financial policy decision-making (Gao et al, 2011). Therefore, we also control for the influence of peer firms (Industry propensity to overpay) and location (State propensity to overpay) on the likelihood of a firm becoming an T A B L E 6 Logistic regression of the impact of tariff cuts on the propensity to overpay This table reports logit regression results of the impact of tariff cuts on overpayment for a panel data set of all USlisted firms in our sample during 1975-2011.…”