Australian Tax Changes and Dividend Reinvestment Announcement Effects: A Pre- and Post-Imputation Study

Keith K.W. Chan, Damien W. McColough, Michael T. Skully

Research output: Contribution to journalArticleResearchpeer-review

6 Citations (Scopus)

Abstract

This paper used an event study approach to examine the impact of dividend reinvestment plans on shareholders’ returns in the pre- and post-imputation environments. The daily share return behaviour indicated that the announcement to introduce a dividend reinvestment plan (DRP) was received indifferently by the market before 1 July 1988, but was valued positively after superannuation funds were able to benefit from the imputation credits. Moreover, the simple market-adjusted returns model and the market model had similar power in detecting abnormal returns in an Australian context.

Original languageEnglish
Pages (from-to)41-62
Number of pages22
JournalAustralian Journal of Management
Volume18
Issue number1
DOIs
Publication statusPublished - 1 Jan 1993

Keywords

  • ANNOUNCEMENT EFFECTS
  • DIVIDEND REINVESTMENT PLAN
  • IMPUTATION

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