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A Lintner Model of Payout and Managerial Rents

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A Lintner Model of Payout and Managerial Rents. / Lambrecht, Bart; Myers, Stewart C.
In: Journal of Finance, Vol. 67, No. 5, 10.2012, p. 1761-1810.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Lambrecht, B & Myers, SC 2012, 'A Lintner Model of Payout and Managerial Rents', Journal of Finance, vol. 67, no. 5, pp. 1761-1810. https://doi.org/10.1111/j.1540-6261.2012.01772.x

APA

Lambrecht, B., & Myers, S. C. (2012). A Lintner Model of Payout and Managerial Rents. Journal of Finance, 67(5), 1761-1810. https://doi.org/10.1111/j.1540-6261.2012.01772.x

Vancouver

Lambrecht B, Myers SC. A Lintner Model of Payout and Managerial Rents. Journal of Finance. 2012 Oct;67(5):1761-1810. Epub 2012 Sept 12. doi: 10.1111/j.1540-6261.2012.01772.x

Author

Lambrecht, Bart ; Myers, Stewart C. / A Lintner Model of Payout and Managerial Rents. In: Journal of Finance. 2012 ; Vol. 67, No. 5. pp. 1761-1810.

Bibtex

@article{4b5ab360b42c472ba69ad2f82d05d775,
title = "A Lintner Model of Payout and Managerial Rents",
abstract = "We develop a dynamic agency model in which payout, investment, and financing decisions are made by managers who attempt to maximize the rents they take from the firm, subject to a capital market constraint. Managers smooth payout to smooth their flow of rents. Total payout (dividends plus net repurchases) follows Lintner{\textquoteright}s (1956) target adjustment model. Payout smooths out transitory shocks to current income and adjusts gradually to changes in permanent income. Smoothing is accomplished by borrowing or lending. Payout is not cut back to finance capital investment. Risk aversion causes managers to underinvest, but habit formation mitigates the degree of underinvestment.",
author = "Bart Lambrecht and Myers, {Stewart C}",
year = "2012",
month = oct,
doi = "10.1111/j.1540-6261.2012.01772.x",
language = "English",
volume = "67",
pages = "1761--1810",
journal = "Journal of Finance",
issn = "0022-1082",
publisher = "Wiley-Blackwell",
number = "5",

}

RIS

TY - JOUR

T1 - A Lintner Model of Payout and Managerial Rents

AU - Lambrecht, Bart

AU - Myers, Stewart C

PY - 2012/10

Y1 - 2012/10

N2 - We develop a dynamic agency model in which payout, investment, and financing decisions are made by managers who attempt to maximize the rents they take from the firm, subject to a capital market constraint. Managers smooth payout to smooth their flow of rents. Total payout (dividends plus net repurchases) follows Lintner’s (1956) target adjustment model. Payout smooths out transitory shocks to current income and adjusts gradually to changes in permanent income. Smoothing is accomplished by borrowing or lending. Payout is not cut back to finance capital investment. Risk aversion causes managers to underinvest, but habit formation mitigates the degree of underinvestment.

AB - We develop a dynamic agency model in which payout, investment, and financing decisions are made by managers who attempt to maximize the rents they take from the firm, subject to a capital market constraint. Managers smooth payout to smooth their flow of rents. Total payout (dividends plus net repurchases) follows Lintner’s (1956) target adjustment model. Payout smooths out transitory shocks to current income and adjusts gradually to changes in permanent income. Smoothing is accomplished by borrowing or lending. Payout is not cut back to finance capital investment. Risk aversion causes managers to underinvest, but habit formation mitigates the degree of underinvestment.

U2 - 10.1111/j.1540-6261.2012.01772.x

DO - 10.1111/j.1540-6261.2012.01772.x

M3 - Journal article

VL - 67

SP - 1761

EP - 1810

JO - Journal of Finance

JF - Journal of Finance

SN - 0022-1082

IS - 5

ER -