18678. Dividend Decisions. This paper argues that an increase in dividend payouts tends to increase firm value, because it sends a signal to investors regarding management’s positive expectations for the future. This argument is based on the dividend signaling model, which is contrary to the MM Irrelevance Proposition that was developed by Modigliani and Miller. The paper includes references to research data and addresses the criticisms that have been made of the dividend signaling model. KEYWORDS: finance investors dividends value signaling model MM irrelevance proposition. APA Style. 6 pages, 19 footnotes, 5 bibliographic sources. 1,487 words.