The Resource Allocation Effect Of Corporate Dividend Behavior Under The Background Of Semi-Mandatory Dividend Policy

The CSRC has released a series of dividend policy guidance documents, requiring improving the cash dividend ratio, and in 2008 the CSRC improved the cash dividend ratio further and linked the listed companies’equity refinancing qualifications with their cash dividend payments, called semi-mandatory dividend policy by scholars.it causes widespread controversy:On one hand, the requirements help construct the system of the capital market, aiming at strengthening the corporations’ consciousness for shareholders’ return. But on the other hand, the intervention of government is contrary to the market operation mechanism, we don’t know whether it can really achieve the goal of protecting the interests of investors and improving the market’s allocation of capital.On the basis of the theoretical analysis, the capital from the low-quality corporations flowing into the high-quality corporations can improve the market’s allocation of capital. But the agency cost, the irrationality of equity structure, the asymmetric information, the changing of external policy, financing constraint and other factors, will affect the resources allocation effect of corporation dividend behavior in some way. In fact, what role does the semi-mandatory dividend policy play in the dividend allocation mechanism?In order to solve the problem, this paper will study the efficiency of resource allocation at two points, the cash dividend distribution and refinancing opportunities distribution, from the perspective of resource allocation efficiency. Before empirical research, this paper used the dispersion law of foreign scholars, with the price per book value (P/B ratio) as the basic index, after the effect of the maturity of the company, industry factors, efficiency of information and other factors being removed, forming the adjusted price per book value (PB*), taking the "PB* dispersion" as an index to measure the efficiency of resources allocation of the market. For research on resource allocation mechanism of dividend distribution, based on the data of listed companies on the SME board from 2009 to 2013, this paper investigated the situation of dividend distribution and the efficiency of resource allocation on the SME board, and found corporations that followed the semi-mandatory dividend policy did not obtain higher efficiency of resource allocation by Kruskal-Walls test method firstly. Secondly, using group study of the dividend allocation mechanism of listing corporations, found that there are different paths for different companies to improve the market’s allocation of capital:high quality corporations pay less cash dividend, the dispersion degree of PB* will be less, improving the efficiency of resource allocation as a whole. But the situation will be eased when the corporation owns higher PB*. Low-quality corporations pay more cash dividends, improving the efficiency of resource allocation, and the effect will be amplified when the corporations own lower PB*. The efficiency of information also affects the efficiency of resource allocation. Ineffective information will reduce the efficiency of resource allocation. Further regression model showed us the influence mechanism of the information efficiency:due to asymmetric information, listing corporat-ions, especially high quality corporations eager to pay more cash dividend to show better expect, choosing the dividend signal mode that is away from the optimal resource allocation state as a whole.For research on resource allocation effect of refinancing opportunity distribution, based on the data of listed companies those obtained equity refinancing opportunities successfully on the SME board from 2008 to 2013, this paper designed an index to reflect the equity refinancing opportunities distribution situation. The results showed that more high quality corporations get equity refinancing opportunities, and the average PB* is relative higher, will significantly reduce the dispersion degree of PB*, improving the market’s allocation of capital.From the perspective of resource allocation efficiency, this paper studied the way that dividend distribution and refinancing opportunities distribution can improve the market’s allocation of capital, and proved that the semi-mandatory dividend policy does exist a certain degree of limitation. The policy makes dividend policy of the list corporations away from the path that can improve the market’s allocation of capital. This paper suggested semi mandatory dividend policy still need to be refined; those companies should develop the profit distribution mechanism, and we need to establish the credit rating system, strengthen the information communication mechanism.