Institutional Environment, Government Control And Divedend Policy

Based on the classification of government initiated by Xia and Fang(2005), thispaper, using the data on the ultimate shareholders disclosed by the listed firmsin 2001 to 2006,and the data on regional institutional environment of China workedout by Fan,Wang and Zhu(2006),investigates the relationship among institutionalenvironment,government control and dividend policy。We find that, governmentcontrol , especially city-level government control leads to pay more dividendsthan other levels。Additionally, the improvement of institutional environment mayincrease the amount of dividend for a specific level government control,whichdoes both good and bad to minority investors in the split-share environment.