Financial Elasticity,Risk-taking And Cash Dividend

The payment of cash dividends ensures that the legitimate rights and interests of investors can be rewarded,conveys a signal that the company is operating well,establishes its own image,and alleviates the company’s agency problem,which is a requirement that helps the capital market to operate in an orderly manner.In the existing research,scholars’ research angles on the factors affecting cash dividends mainly include external environment,corporate governance and financial characteristics.Financial resilience is the ability of a business to adjust its free cash flow,seize investment opportunities and avoid financial distress when faced with cash needs.Considering financing costs and potential investment opportunities,companies will make trade-offs when formulating dividend payment policies.It can be seen that financial flexibility is closely related to companies’ investment,financing,and profit distribution.However,few scholars consider financial heteroelasticity when studying cash dividends.The research takes the A-share non-financial listed companies from 2010 to2020 as a sample,and uses the ordinary least squares method for regression analysis.The results show that financial heteroelasticity has a significant role in promoting cash dividend payments.Compared with low financial elasticity,high financial flexibility has a more significant effect on the payment of cash dividends.Risk-taking plays a significant positive moderating role in the promotion of cash dividends by high financial flexibility.Further research found that in state-owned enterprises,the relationship between financial flexibility,risk-taking and cash dividends was established,and the significance was high;in non-state-owned enterprises,the relationship between financial flexibility,risk-taking and cash dividends was established,and the significance was high.However,in the sample of non-state-owned enterprises,risk-taking no longer has a positive adjustment to the promotion of dividend payment due to low financial flexibility;in the sample of state-owned enterprises,risk-taking no longer has a positive adjustment to the promotion of dividend payment due to high financial flexibility.At the same time,considering the degree of financing constraints of different companies,the promotion effect of financial heteroelasticity on dividend payment is still significantly established,but for the research sample,only in the highly constrained group,risk taking has a positive effect on high financial elasticity in promoting cash dividend payment to the moderating effect.Financial flexibility is a kind of financial soft power of an enterprise.The change of financial flexibility will affect the cash reserve and debt capacity of the enterprise,and then affect the capital demand of the enterprise.The level of enterprise risk taking reflects the attitude of the enterprise in investment decision-making.Higher risk taking reflects the company’s optimistic attitude towards high-risk investment projects and has a more adventurous spirit,while companies with lower risk taking are more likely to abandon such investment projects.Defining the financial heteroelasticity and studying the relationship between the three effectively complements the financial elasticity system,further improves the research on cash dividend payment,enriches the existing research perspective,and brings a new development direction.