Home|Journals Follow on Twitter| Subscribe to List

Directory for Medical Articles
 

Open Access

Original Research

EJMS. 2003; 8(1): 73-85


FISCAL EFFECT IN DIVIDEND DISTRIBUTIONS

Maria Rosa Borgas.

Abstract
The dividend irrelevancy proposition, which states that dividends have no impact on the market value of the firm, is only valid under the hypothesis of perfect markets. If market imperfections are considered, namely, the existence of taxes, then dividend distributions became relevant for the decisions of market investors. But even in the presence of taxes, it should be indifferent for the investors to trade before or after the dividend day. If rational arbitrage prevails, the stock price adjustment on the distribution day should reflect the relative taxation of dividends and capital gains. In this paper, this theoretical framework is applied to portuguese data.

Key words: dividend distributions; taxes; capital gains; stock price adjustment



Share this Article


Advertisement
Journal of Complementary Medicine Research

SUBMIT YOUR ARTICLE NOW


ScopeMed.com
BiblioMed Home
Follow ScopeMed on Twitter
Author Tools
eJPort Journal Hosting
About BiblioMed
License Information
Terms & Conditions
Privacy Policy
Contact Us

The articles in Bibliomed are open access articles licensed under the terms of the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License (https://creativecommons.org/licenses/by-nc-sa/4.0/) which permits unrestricted, non-commercial use, distribution and reproduction in any medium, provided the work is properly cited.
ScopeMed is a Database Service for Scientific Publications. Copyright ScopeMed Information Services.