Premium
Ex‐dividend Day Pricing in New Zealand
Author(s) -
Bartholdy Jan,
Brown Kate
Publication year - 1999
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/1467-629x.00020
Subject(s) - taxable income , dividend , sample (material) , economics , monetary economics , financial economics , dividend tax , econometrics , business , accounting , tax reform , state income tax , public economics , finance , chemistry , chromatography , gross income
Controversy continues over the question of tax clientele effects in the pricing of shares that pay dividends. The empirical results remain inconclusive, with variations in testing methods and sample formation the probable causes of much of the variation in outcomes. This study focuses on testing for the presence of a tax clientele effect consistent with prior tests for the same effect using a sample from a particular tax regime period in New Zealand in which companies could pay either or both taxable and non‐taxable dividends. The results are generally consistent with the presence of a tax clientele effect in the New Zealand market for the time period, while providing essentially no support for the short term trading hypothesis. JEL classification: G10; G15