Cash Dividends,dynamic Adjustment Of Capital Structure And Enterprise Performance

Currently,there is a conflict between cash dividend payouts and corporate capital structure adjustment behavior(financing behavior),i.e.,conducting external financing while distributing cash dividends.Under this circumstance,it is necessary to discuss the relationship among cash dividends,corporate capital structure adjustment behavior,and corporate performance.Based on distinguishing the direction of capital structure adjustment,this study uses the speed of capital structure adjustment as the mediating variable to investigate the effect of cash dividends(explanatory variable)on corporate performance(dependent variable).The study employs a mediating effect research method and conducts empirical tests based on data from Ashare listed companies from 2009 to 2021.The research findings are as follows:(1)The direct effect of cash dividend payouts is to improve corporate performance under other conditions unchanged.(2)When the capital structure needs to be adjusted upwards,cash dividends will increase the speed of upward adjustment of the capital structure.The increase in the speed of upward capital structure adjustment will reduce corporate performance.When the capital structure needs to be adjusted downwards,cash dividends will decrease the speed of downward adjustment of the capital structure.The decrease in the speed of downward capital structure adjustment will also reduce corporate performance.Therefore,regardless of the direction in which the capital structure needs to be adjusted,the direct effect of cash dividends is to improve corporate performance.However,in the transmission path of cash dividends-capital structure adjustment speed-corporate performance,cash dividends exhibit a reduction in corporate performance,and the speed of capital structure adjustment,as a mediating variable,produces a mediating effect.The implication of the study’s conclusion in economic life is that cash dividend payouts and corporate capital structure adjustment behavior(mainly in the form of financing behavior)are contradictory.Therefore,it is not advisable to engage in capital structure adjustment behavior after cash dividend payouts.The innovation of this study lies in enriching the research on the relationship between cash dividends and corporate performance by considering the direction of capital structure adjustment and investigating the transmission path of cash dividends-capital structure adjustment speed-corporate performance using the speed of capital structure adjustment as a mediating variable.Based on the research findings,this study provides corresponding recommendations for investors,listed companies,and regulatory authorities.The key point is that not only should cash dividend payouts be considered,but also the coordination between cash dividend payouts and subsequent capital structure adjustment behavior(financing behavior)needs to be taken into account.In particular,regulatory authorities should increase efforts to develop a scientific evaluation system that can be used to measure whether the distribution of cash dividends and financing behavior of listed companies are reasonable,to ensure the scientific,rational and effective distribution of cash dividends and financing behavior.