Abstract

Citations (15)

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Dividends and Profits: Some Unsubtle Foreign Influences

James R. Hines Jr.
University of Michigan at Ann Arbor Law School; National Bureau of Economic Research (NBER)

J. OF FINANCE, Vol. 51 No. 2, June 1996

Abstract:
American corporations earn a significant share of their profits from foreign sources, out of which they appear to pay dividends at rates that are three times higher than their payout rates from domestic profits. Why firms do so is unclear, though this behavior is consistent with the use of dividends to signal profitability. This payout behavior implies that a significant part of the US tax revenue generated by the foreign profits of US corporations arises through the taxation of dividends received by individuals, and that the cost of capital may be higher for foreign than for domestic operations.

JEL Classifications: G35, F23, H87

Accepted Paper Series

Date posted: June 28, 1998 ; Last revised: January 09, 2006

Suggested Citation

Hines Jr., James R., Dividends and Profits: Some Unsubtle Foreign Influences. J. OF FINANCE, Vol. 51 No. 2, June 1996. Available at SSRN: http://ssrn.com/abstract=7525

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Contact Information

James Rodger Hines (Contact Author) University of Michigan at Ann Arbor Law School ( email ) 625 South State Street Ann Arbor, MI 48109-1215 United States
National Bureau of Economic Research (NBER) 1050 Massachusetts Avenue Cambridge, MA 02138 United States

Abstract

Citations (15)

Date posted: June 28, 1998 ; Last revised: January 09, 2006

Suggested Citation

Contact Information

James Rodger Hines (Contact Author)