Journal of Banking & Finance Vol. 143 2022
Do investors value shareholder perks? Evidence from Japan
Abstract
By focusing on the price and trading volume movements around the ex-days of shareholder perks, we investigate whether and how investors value shareholder perks. Using comprehensive shareholder perks data from Japan, we demonstrate a significant price decline for stocks with shareholder perks around ex-days, as an evidence that shareholder perks are valuable for investors. We also show that heterogeneous preference for shareholder perks among investors leads to active trading around the ex-day. A price drop larger than the estimated cost of shareholder perks implies that gift giving is welfare increasing, providing a new insight into the long-standing debate on whether gift giving creates welfare gain or loss. This study also provides empirical findings that are consistent with behavioral model of mental accounting, which posits that receiving a gift-in-kind rather than cash or gift cards is utility increasing for consumers.
- DOI
- 10.1016/j.jbankfin.2022.106575
- Volume
- 143
- Pages
- 106575
- Language
- en
- Sources
- openalex crossref bibtex:phds-export.bib