An empirical examination of the price-dividend relation with dividend management
Abstract: Some recent empirical evidence suggests that stock prices are not properly modelled as the present discounted value of expected dividends. In this paper we estimate a present value model of stock price that is capable of explaining the observed long-term trends in stock prices. The model recognizes that firm managers control cash dividend payments. The model estimates indicate that stock price movements may be explained by managerial behavior.
File(s): File format is application/pdf http://www.chicagofed.org/digital_assets/publications/working_papers/2000/wp2000_22.pdf
Provider: Federal Reserve Bank of Chicago
Part of Series: Working Paper Series
Publication Date: 2000