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Rent extraction by large shareholders: evidence using dividend policy in the Czech Republic
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SYSNO ASEP 0039382 Document Type J - Journal Article R&D Document Type Journal Article Subsidiary J Ostatní články Title Rent extraction by large shareholders: evidence using dividend policy in the Czech Republic Title Získávání renty velkými vlastníky akcií: důkaz s použitím dividendové politiky v České republice Author(s) Bena, Jan (NHU-N)
Hanousek, Jan (NHU-N) RIDSource Title CERGE-EI Working Paper Series - ISSN 1211-3298
-, č. 291 (2006), s. 1-45Number of pages 45 s. Publication form WWW - WWW Language eng - English Country CZ - Czech Republic Keywords rent extraction ; large shareholders ; corporate governance Subject RIV AH - Economics R&D Projects GA402/06/1293 GA ČR - Czech Science Foundation (CSF) CEZ AV0Z70850503 - NHU-N (2005-2011) Annotation Using cross-sectional analysis of corporate dividend policy we show that large shareholders extract rents from firms and expropriate minority shareholders in the weak corporate governance environment of an emerging economy. By comparing dividends paid across varying corporate ownership structures - concentration, type, and domicile of ownership - we quantify these effects and reveal that they are substantial. We find that the target payout ratio for firms with majority ownership is low but that the presence of a significant minority shareholder increases the target payout ratio and hence precludes a majority owner from extracting rent. In contrast to other studies from developed markets, our unique dataset from the Czech Republic for the period 1996-2003 permits us to take account of the endogeneity of ownership. Workplace Economics Institute Contact Tomáš Pavela, pavela@cerge-ei.cz, Tel.: 224 005 122 Year of Publishing 2007
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