本研究針對2000年在台灣庫藏股票合法化之後的兩年內，有進行庫藏股票買回的188間上市公司來檢視台灣股票回購合法化對公司行為之影響，期間為1986年至2010年。研究包括分析股票回購合法化後如何影響配息政策、股票買回融資策略、股票報酬率和長期公司價值。首先，本研究檢視股票回購合法後公司如何改變其配息政策，以及股票回購和股利是否有替代關係。本研究也調查公司如何在股票回購合法化後為其股票回購融資和股票回購合法化後市場對股票回購的反應。最後，本研究將股票回購合法化後公司價值的影響也納入考量進行研究。在我的研究中發現，台灣庫藏股票合法化無法使台灣的上市公司減少持有現金。同時，庫藏股票合法化使股票報酬顯著提升，但是在長期之下卻對公司價值有所損害。此結果顯示，台灣庫藏股票合法化無法解決自由現金流量導致的代理問題。

The main focus of this study is to examine the consequences of the legalization of stock buybacks on corporate behavior by exploring a sample of 188 listed companies in Taiwan that conducted stock buybacks within two years after the legalization of stock buybacks in 2000. The sample period extends from 1986 to 2010. Specifically, I analyze how stock buybacks legalization affects payout policies, investment and financing strategies, stock return, and long-term company execution. First, the study explores how companies alter their payout policies after stock buybacks become legal, and whether stock buybacks are used as a replacement for dividends. Second, the study investigates how companies finance their stock buyback and how the market reacts after stock buybacks are legalized. Last, the study examines the effects of stock buyback legalization on a company's performance. I find that the legalization of stock buybacks in Taiwan does not necessarily reduce firms’ cash assets. While stock repurchases initially boost stock returns, they detrimentally affect the long-term valuation of the company. My results suggest that the legalization does not effectively address agency problems associated with free cash flow.

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