We hypothesize that the 2003 decrease in individual tax rates on dividends and capital gains should have been followed by a decline in the cost of capital and increased volatility, especially for dividend paying firms. We observe a significantly positive increase in the volatility of daily...

The general consensus regarding the Jobs and Growth Tax Relief Reconciliation Act of 2003, which reduced the maximum tax rate on dividends for individual investors, is that aggregate dividend payments increased after passage of the act. Research also suggests that changes in dividend payments...

We investigate the relationship between relationship between U.S. Treasury bill yields and the dividend yield of the S&P 500 in the period before and after the passage of the Jobs Growth Tax Relief Reconciliation Act (JGTRRA) in 2003. The results suggest that there is an upward pressure on the...