We study how creditor rights and culture interact with one another to influence corporate dividend
payout policy. Where creditor rights are strong, creditors accept the status quo, which are large dividends
in individualist and small dividends in collectivist traditions, respectively. Culture influences dividend
payout where creditor rights are weak. In collectivist countries where group cohesion among corporate
stakeholders results in perceived lower agency costs of debt and equity, creditors place few if any
restrictions on dividend payout given weak creditor rights. In contrast, in individualist traditions, creditors
continue to restrict dividend payouts under weak creditor rights. Our findings emphasize the importance
of accounting for the interactions between creditor rights and culture in determining dividend policy
