Research About The Effect Of Managerial Overconfidence On Cash Dividend Policy

Dividend policy will not only influence the shareholder returns, but also the enterprise's future investment, financing decisions, business activities, stock prices. And the cash dividend policy is the most common and most important is the most common and most important form in the mature securities market. Reasonable dividend policy can not only pass the management status and the future development trend, set up a good image, but also attract investors'long-term investment and make the enterprise has a long-term, stable source of funds, maintain stable growth and realize the maximization of enterprise value. Because our country's securities market started relatively late and developed not perfectly, there are many unreasonable places when managers of listed companies make the cash dividend distribution policy, such as no, less and unstable distribution, ultra-ability dividends payout, etc. The traditional dividend theory cannot fully explain the anomalies in the cash dividend distribution, which demands us to study the influence factors of cash dividend distribution policy from a new perspective.With the emergence of behavioral finance, some scholars began to take the psychological factors of behavior subject into the research of dividend distribution policy research. They began to study the cash dividend policy from the perspective of managerial overconfidence. Managerial overconfidence has the adverse impact on the cash dividend distribution of listed companies as a kind of irrational behavior. So many scholars attempt to study the factors which can restrict managers' overconfidence from different angles. This paper attempt to study whether corporate governance can restrict the impact of managers' overconfidence on the cash dividend policy.Based on this, this paper analyses the behavioral finance theory and dividend theories, reviews the previous literature, and analyses empirically based on the data from A-share listed firms during the year 2010-2014, applying the Logistic model, the multiple linear regression model to study mainly the following problems:whether the managerial overconfidence impacts the cash dividend policy and whether the impact of the managerial overconfidence on the cash dividend policy changes under the different environment of corporate governance.The dissertation presents that:(1) The managerial overconfidence has a significant negative impact upon the company's cash dividend policy. That is to say that the more overconfident the manager is, the company is less likely to pay the cash dividend, is likely to pay less and unstable cash dividend.(2) Under the different environment of corporate governance, the impact of the managerial overconfidence on the cash dividend policy is different. This reveals that the corporate governance can restrict the impact of the managerial overconfidence on the cash dividend policy to some extent.