Does parenting daughters increase corporate cash dividends? Evidence from Chinese family firms

Abstract

Research in the social sciences has shown that interactions with biological daughters are potent catalysts for instilling and nourishing parents' social values, preferences, and behaviors. Drawn on the female socialization hypothesis, we investigate the impact of ultimate controlling owners’ offspring gender on corporate dividend policy. Based on data from Chinese family-owned listed companies, our empirical results document a “daughter effect” in cash dividends. That is, ultimate controlling owners shaped by daughters are more altruistic and less likely to exploit the interests of minority shareholders, which leads to more dividend activities. The results remain robust when considering endogeneity. Moreover, the “daughter effect” is more pronounced when the ultimate controlling owner is male, has a higher education background, and has been influenced by the daughter for a longer time. This paper contributes to the growing literature on female socialization and the determinants of dividend payments.