Demographics of dividends

Using seventeen observable demographic characteristics, we investigate the impact of six CEO profiles on dividend policy. Firms headed by married, Republican, Christian CEOs with children maintain higher dividend yields and are more likely to considerably increase their dividend payout. Following substantial dividend hikes, firms led by CEOs with these more traditional personal lives exhibit deteriorating performance. Potential explanations include managerial optimism coupled with dividend signaling and the possibility that CEO profiles proxy for an unobserved firm effect such as firm maturity. However, the associations above continue to persist in both mature firm and turnover sub-samples. Overall, this suggests that these relationships are related to characteristics of the CEOs themselves. (C) 2013 Elsevier B.V. All rights reserved.