Why Do Firms Pay Dividends?: Evidence from an Early and Unregulated Capital Market

Why do firms pay dividends? To answer this question, we use a hand-collected data set of companies traded on the London stock market between 1825 and 1870. As tax rates were effectively zero, the capital market was unregulated, and there were no institutional stockholders, we can rule out these potential determinants ex ante. We find that, even though they were legal, share repurchases were not used by firms to return cash to shareholders. Instead, our evidence provides support for the information–communication explanation for dividends, while providing little support for agency, illiquidity, catering, or behavioral explanations. © The Authors 2013. Published by Oxford University Press [on behalf of the European Finance Association]. All rights reserved.

E-Commerce Innovations in the Personal Tax System of the United Kingdom

This study finds evidence that attempts to reduce costs and error rates in the Inland Revenue through the use of e-commerce technology are flawed. While it is technically possible to write software that will record tax data, and then transmit it to the Inland Revenue, there is little demand for this service. The key finding is that the tax system is so complex that many people are unable to complete their own tax returns. This complexity cannot be overcome by well-designed software. The recommendation is to encourage the use of agents to assist taxpayers or simplify the tax system. The Inland Revenue is interested in saving administrative costs and errors by encouraging electronic submission of tax returns. To achieve these objectives, given the raw data it would seem clear that the focus should be on facilitating the work of agents.

Is childhood type 1 diabetes a wealth-related disease? An ecological analysis of European incidence rates

Aims/Hypothesis: To describe the epidemiology of childhood-onset Type 1 (insulin-dependent) diabetes in Europe, the EURODIAB collaborative group has established prospective, geographically-defined registers of children diagnosed under 15 years. A total of 16,362 cases were registered by 44 centres during the period 1989-1994. The registers cover a population of approximately 28 million children with most European countries represented. Methods In most centres a primary and a secondary source of ascertainment were used so that the completeness of registration could be assessed by the capture-recapture method. Ecological correlation and regression analyses were used to study the relationship between incidence and various environmental, health and economic indicators. Findings: The standardised average annual incidence rate during the period 1989-94 ranged from 3.2 cases per 100,000 per annum in the Former Yugoslavian Republic of Macedonia to 40.2 cases per 100,000 per annum in Finland. Indicators of national prosperity such as infant mortality (r= -0.64) and gross domestic product (r= 0.58) were most strongly and significantly correlated with incidence rate, and previously-reported associations with coffee consumption (r= 0.51), milk consumption (r= 0.58) and latitude (r= 0.40) were also observed. Conclusion/Interpretation: The wide variation in childhood type 1 diabetes incidence rates within Europe could be partially explained by indicators of national prosperity. These indicators could reflect differences in environmental risk factors such as nutrition or lifestyle that are important in determining a country's incidence rate.

Wide Variation in Adenoma Detection Rates at Screening Flexible Sigmoidoscopy

Background & Aims: Wide between-center variation in adenoma detection rates (ADRs) was observed in the U.K. Flexible Sigmoidoscopy Screening Trial (overall, 12.1%; range, 8.6%-15.9%; P <0.0001). The aim of this study was to determine whether the observed differences could be attributed to varying performance by endoscopists, to examine the effect of experience on performance, and to identify an attainable, standard ADR to which endoscopists could aspire. 

Methods: Thirteen medical endoscopists, one per trial center, each performed about 3000 examinations (200 per month) using the same equipment and protocol. Overall and monthly ADRs were compared using multivariable logistic regression. 

Results: Differences in ADRs were not explained by patient characteristics, incidence of colorectal cancer in the local population, or the endoscopists' medical specialty or previous experience. Average ADRs increased significantly with screening experience (up to 400 examinations). Endoscopists were classified as higher, intermediate, or lower adenoma detectors, and performance levels were maintained over time. Higher detectors had ADRs of 15% overall (men, 20%; women, 10%) and also detected more adenomas per case (higher/lower detectors, 21.7/10.4 adenomas per :100 examinations). 

Conclusions: The differences in ADRs were due to variation in performance of the endoscopists. Long-term follow-up will determine whether this variation is clinically important. We suggest that the standards in higher detecting centers should be achievable by all endoscopists screening unscreened populations aged older than 55 years. Endoscopists should aim to stay above the lower 95% confidence interval band for 200 examinations (10% overall; 5% in women, 15% in men).