{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"indexed":{"date-parts":[[2026,9,18]],"date-time":"2026-09-18T06:27:44Z","timestamp":1789712864048,"version":"4.0.1"},"posted":{"date-parts":[[2014]]},"group-title":"SSRN","reference-count":58,"publisher":"Elsevier BV","content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":[],"abstract":"<jats:p>We find that 43% of firms that make payouts also raise capital during the same year, resulting in 31% of aggregate payouts being externally financed, primarily with debt. Most financed payouts cannot be explained by payout-smoothing in response to volatile earnings or investment\u2014rather, they are the result of firms persistently setting payouts above free cash flow. In fact, 25% of aggregate payouts could not have been paid without the firms simultaneously raising capital. Profitable firms with moderate growth use debt-financed payouts to jointly manage their leverage and cash, thus highlighting the close relationship between payout and capital structure decisions.<\/jats:p>","DOI":"10.2139\/ssrn.2535675","type":"posted-content","created":{"date-parts":[[2014,12,10]],"date-time":"2014-12-10T11:02:48Z","timestamp":1418209368000},"source":"Crossref","is-referenced-by-count":17,"title":["Financing Payouts"],"prefix":"10.2139","author":[{"given":"Joan","family":"Farre-Mensa","sequence":"first","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]},{"ORCID":"https:\/\/orcid.org\/0000-0003-2675-9667","authenticated-orcid":true,"given":"Roni","family":"Michaely","sequence":"additional","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]},{"given":"Martin C.","family":"Schmalz","sequence":"additional","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]}],"member":"78","reference":[{"key":"ref1","doi-asserted-by":"crossref","first-page":"3572","DOI":"10.1093\/rfs\/hhs106","article-title":"Cash Holdings and Credit Risk","volume":"25","author":"Acharya","year":"2012","journal-title":"Review of Financial Studies"},{"key":"ref2","doi-asserted-by":"crossref","first-page":"110","DOI":"10.1016\/j.jfineco.2013.04.009","article-title":"Pricing the term structure with linear regressions","volume":"110","author":"Adrian","year":"2013","journal-title":"Journal of Financial Economics"},{"key":"ref3","doi-asserted-by":"crossref","first-page":"298","DOI":"10.1016\/j.jfineco.2021.06.004","article-title":"Foreign investment of US multinationals: The effect of tax policy and agency conflicts","volume":"144","author":"James Albertus","year":"2022","journal-title":"Journal of Financial Economics"},{"key":"ref4","doi-asserted-by":"crossref","first-page":"191","DOI":"10.1093\/rfs\/13.1.191","article-title":"Are there economies of scale in underwriting fees? 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