Dividend puzzle

The dividend puzzle is the empirically observed phenomenon that companies that pay dividends tend to be rewarded by investors with higher valuations. At present, there is no explanation widely accepted by economists. The Modigliani–Miller theorem suggests that the puzzle can (only) be explained by some combination of taxes, bankruptcy costs, market inefficiency (including that due to investor psychology), and asymmetric information.

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Source: List of unsolved problems in economics (CC BY-SA 4.0)