Topic
Share repurchase
About: Share repurchase is a research topic. Over the lifetime, 598 publications have been published within this topic receiving 30946 citations. The topic is also known as: stock buyback & share buyback.
Papers published on a yearly basis
Papers
Posted Content•
TL;DR: In this article, the authors consider the problem of aligning managers' interests with those of investors and offer agency-cost explanations of dividends, and conclude that "these two lines of inquiry rarely meet." Yet logically any dividend policy should be designed to minimize the sum of capital, agency and taxation costs.
Abstract: The economic literature about dividends usually assumes that managers are perfect agents of investors, and it seeks to determine why these agents pay dividends. Other literature about the firm assumes that managers are imperfect agents and inquires how managers' interests may be aligned with shareholders' interests. These two lines of inquiry rarely meet.' Yet logically any dividend policy (or any other corporate policy) should be designed to minimize the sum of capital, agency, and taxation costs. The purpose of this paper is to ask whether dividends are a method of aligning managers' interests with those of investors. It offers agency-cost explanations of dividends.
3,673 citations
TL;DR: In this article, the authors assume that outside investors have imperfect information about firms' profitability and that cash dividends are taxed at a higher rate than capital gains, and they derive a comparative static result that relates the equilibrium level of dividend payout to the length of investors' planning horizons.
Abstract: This paper assumes that outside investors have imperfect information about firms' profitability and that cash dividends are taxed at a higher rate than capital gains. It is shown that under these conditions, such dividends function as a signal of expected cash flows. By structuring the model so that finite-lived investors turn over continuing projects to succeeding generations of investors, we derive a comparative static result that relates the equilibrium level of dividend payout to the length of investors' planning horizons.
3,166 citations
TL;DR: The authors survey 384 financial executives and conduct in depth interviews with an additional 23 to determine the factors that drive dividend and share repurchase decisions, finding that maintaining the dividend level is on par with investment decisions while repurchases are made out of the residual cash flow after investment spending.
2,133 citations
TL;DR: In this article, the authors examine long run firm performance following open market share repurchase announcements, 1980-1990, and find that the average abnormal four-year buy-and-hold return measured after the initial announcement is 12.1%.
1,748 citations
TL;DR: In this article, the authors show that repurchases have become an important form of payout for U.S. corporations and that firms finance their share repurchase with funds that otherwise would have been used to increase dividends.
Abstract: We show that repurchases have not only became an important form of payout for U.S. corporations, but also that firms finance their share repurchases with funds that otherwise would have been used to increase dividends. We find that young firms have a higher propensity to pay cash through repurchases than they did in the past and that repurchases have become the preferred form of initiating a cash payout. Although large, established firms have generally not cut their dividends, they also show a higher propensity to pay out cash through repurchases. These findings indicate that firms have gradually substituted repurchases for dividends. Our results also suggest that before 1983, regulatory constraints inhibited firms from aggressively repurchasing shares.
1,346 citations
Related Topics (5)
Performance Metrics
| Year | Papers |
|---|---|
| 2026 | 1 |
| 2025 | 1 |
| 2024 | 3 |
| 2023 | 14 |
| 2022 | 17 |
| 2021 | 24 |