Dividend Variability and Stock Market Swings

@inproceedings{Evans2001DividendVA,
  title={Dividend Variability and Stock Market Swings},
  author={Martin D. D. Evans},
  year={2001}
}
This paper examines the extent to which swings in stock prices can be related to variations in the discounted value of expected future dividends when investors face uncertainty about their future behavior. I develop an econometric model that accounts for the instability of U.S. dividend growth and discount rates during the past 120 years. Estimates of the model reveal that changing forecasts of future dividend growth account for more than 90% of the predictable variations in dividend-prices… CONTINUE READING

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