Analysis Of Influencing Factors Of The Cash Dividend Policy Of Listed Companies In China

In capital markets,firms pay dividends in order to reduce agency costs as well as convey the signal of future growth to investors.A proper dividend policy is one of the key policy decisions to firms in our country.In this paper,we would like to examine the determinants of dividend payouts,especially how and to what extent the share structure influences the dividend policy.After analyzing the collecting data,we find that there are very serious agency problems in our stock market and many listed companies distribute cash dividends exceeds their free cash flow.The holding owner uses the dividend policy as a legal way to tunneling.This is mainly because of the special share structure,which is lack of some restricting forces such as institutional holder.We mainly focus on the determinants of share structure such as holding ownership, institutional ownership,management ownership and the fraction of A-stock,to the dividend policy of firms.We extend the standard minimum cost model of Rozeff and relate the above factors to dividend payouts of firms.Our empirical results support the hypothesis that holding ownership,institutional ownership and the fraction of A-stock significantly influence the dividend policy,and that the significance of each factor increases after the dual-rights reform.