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Burden the Hand: Regulatory Intensity and Payout Policy

Year: 2026

Type: article

Abstract: ABSTRACT We investigate the impact of regulatory intensity on firms' payout policies. While regulations may increase budgetary pressure, leading to decreased payout, we document that regulatory burden increases total payout, especially in the form of dividends. The documented dividend payment increase is significant for firms with higher institutional ownership or those needing more managerial discipline, but not driven by low investment opportunities. Firms increasing dividend followed by regulations are associated with enhanced firm value. The results indicate that shareholders pressure firms to increase dividend payments to discipline managers who might take advantage of the heightened uncertainty that the regulatory burden induces.

Source: European Financial Management

DOI: 10.1111/eufm.70060

Authors: Yahia Abdelbar, Yoonsoo Nam, Cuyler Strong, Ao Wang

Institutions: Wayne State University, Construction Development (Qatar), Centre Jacques Berque pour le Développement des Sciences Humaines et Sociales, Ministry of Education, Clemson University, Washington State University Vancouver

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Peace, justice, and strong institutions

Open Access status: green

OpenAlex ID: W7136375496

FWCI:

Cites: 60

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