Culture and payout policy: International evidence*

The purpose of the study is to examine the effect of national culture on corporate payout mix policy (dividends and share repurchases). Using an extensive data set covering 55 countries during 1980-2018, we find that the national cultural dimension significantly affects the payout policy mix, choice, and levels. Firms in countries with high uncertainty avoidance, masculinity, long-term orientation, and indulgence vs. restraint are inclined to pay out through share repurchases. In contrast, firms in countries with low uncertainty avoidance, masculinity, longterm orientation, and indulgence vs. restraint tend to pay out through dividends. Our findings are robust to control for firm and country characteristics, alternative payout ratios, different culture proxies, sub-period samples, and subsamples.