This paper examines a firm's dividend and investment policies in a model in which some investors are not aware of some of the firm's investments. These naive investors attribute all dividend changes to earning changes, although the change in dividend is sometimes due to a new investment...

We model rational herd behavior when the underlying value changes over time, with payoffs that are either dependent or independent of the underlying value. We show that herding does not last forever and is not monotone in signal quality. High correlation among agents' actions does not...

This paper examines a firm's dividend and investment policies in a model in which some investors are not aware of some of the firm's investments. These naive investors attribute all dividend changes to earning changes, although the change in dividend is sometimes due to a new investment...