【本期主题】Stock Dividends, Gambling Clientele, and Cost of Equity
What are the benefits to a firm of having retail-gambling investors as shareholders? Motivated by studies showing that gambling clientele requires a lower rate of return to take risk, we hypothesize that firms can use stock dividends to attract investors with gambling preference to share risk and to lower cost of equity. Indeed, analyzing a sample of Chinese firms that use stock dividends, we find that, on average, shareholders increase by 54% and retail gambling investors increase by 119% following stock dividends; and, while firms become more risk-taking, their cost of equity declines substantially, largely due to the increased retail gambling investors’ pricing influence. Our study shows that stock dividends are effective for improving risk-sharing efficiency, and provides support for gambling preference theory of asset pricing.
【报告人】Ji-Chai Lin(林基财) 香港理工大学教授
【时 间】11月2日 (周五) 上午10:00
Dr. JC Lin is Chair Professor of Finance and Christina Lee Professor in Accounting and Finance at Hong Kong PolyU. Before joining PolyU in January 2015, he was the holder of Lloyd F. Collette Endowed Chair of Financial Services and Professor of Finance at LSU. He obtained his Ph.D. from the University of Iowa in 1988. Dr. Lin has given lectures at universities in the U.S., U.K., Finland, China, Hong Kong and Taiwan, and won awards in teaching and research. Dr. Lin has a broad range of research interests, and has published his research in the prestigious academic journals in the finance and accounting disciplines, including the Journal of Finance, Journal of Financial Economics, Review of Financial Studies, Accounting Review, Journal of Financial and Quantitative Analysis, Journal of Corporate Finance, Financial Management, Journal of Financial Markets, and Journal of Banking and Finance.