Decentralized Investment Banking: The Case of Discount Dividend-Reinve stment and Stock-Purchase Plans

Discount dividend-reinvestment and stock-purchase plans allow shareholders to capture part of the underwriting fees incurred in new stock offerings and save sponsoring firms some of the usual underwriting costs. We tested the degree to which individual investors can profitably serve this investment banking function by implementing simple investment/trading strategies designed to capture the discounts and distribute the shares in the market. The large profits earned by our strategies raise serious questions about why it takes firms so long to raise the target level of capital and why many eligible shareholders do not participate in these discount plans.

Employee Stock Ownership Plans and Corporate Restructuring: Myths and Realities

During the first six months of 1989 U.s. corporations acquired over $19 billion of their own stock to establish employer stock ownership plans (ESOPs). We evaluate the common claims that there exist unique tax and incentive contracting advantages to establishing ESOPs. Our analysis suggests that, particularly for large firms, where the greatest growth in ESOPs has occurred, the case is very weak for taxes being the primary motivation to establish an ESOP. The case is also weak for employee incentives being the driving force behind their establishment. We conclude that the main motivation for the growth of ESOPs is their anti-takeover characteristics.

The Effects of Changes in Tax Laws on Corporate Reorganization Activity

We present evidence that changes in tax laws passed in the 1980s, culminating with the Tax Reform Act of 1986, had a first order effect on observed merger and acquisition activity in the US. We also present evidence of increased reliance on certain institutional arrangements (unit management buyouts and going-private transactions) used to effect mergers and acquisitions that were designed to reduce the nontax costs of transacting, thereby enabling tax benefits to be realized in a larger number of mergers and acquisitions than might otherwise have occurred. We begin with a "closed-economy" perspective, focusing on the effects of changes in tax laws on the demand for mergers and acquisitions of us corporations by US corporations. We then broaden the scope of inquiry by modeling and testing the effects of changes in tax laws on the demand for mergers and acquisitions of US corporations by foreign multinationals. Here we predict and present confirmatory evidence that while the 1986 Tax Act discouraged transactions among US corporations, it increased the demand for merger and acquisition transactions between US sellers and foreign buyers.

Converting Corporations to Partnerships through Leverage: Theoretical and Practical Impediments

We explore the degree to which debt financing can reduce the corporate-level tax on income in the U.S.. Although we show that debt is capable of shielding the competitive rate of return on projects from the corporate-level tax, debt financing cannot shield the positive net present value portion of project returns. Since nontax factors preclude corporate activities from being 100% debt-financed, a portion of the competitive return to corporate activity is also subject to double taxation. We also consider alternative mechanisms that serve to convert the corporate tax to a personal tax (or a partnership tax). These include other claims that give rise to tax deductible payments to the corporation such as obligations to employees, lessors and suppliers. As we show, all of these alternatives are limited in their ability to eliminate the corporate-level tax.

Comparison of Short-Wavelength Reduced-Illuminance and Conventional Autofluorescence Imaging in Stargardt Macular Dystrophy

Purpose To compare grading results between short-wavelength reduced-illuminance and conventional autofluorescence imaging in Stargardt macular dystrophy. Design Reliability study. Methods setting: Moorfields Eye Hospital, London (United Kingdom). patients: Eighteen patients (18 eyes) with Stargardt macular dystrophy. observation procedures: A series of 3 fundus autofluorescence images using 3 different acquisition parameters on a custom-patched device were obtained: (1) 25% laser power and total sensitivity 87; (2) 25% laser power and freely adjusted sensitivity; and (3) 100% laser power and freely adjusted total sensitivity (conventional). The total area of 2 hypoautofluorescent lesion types (definitely decreased autofluorescence and poorly demarcated questionably decreased autofluorescence) was measured. main outcome measures: Agreement in grading between the 3 imaging methods was assessed by kappa coefficients (κ) and intraclass correlation coefficients. Results The mean ± standard deviation area for images acquired with 25% laser power and freely adjusted total sensitivity was 2.04 ± 1.87 mm2 for definitely decreased autofluorescence (n = 15) and 1.86 ± 2.14 mm2 for poorly demarcated questionably decreased autofluorescence (n = 12). The intraclass correlation coefficient (95% confidence interval) was 0.964 (0.929, 0.999) for definitely decreased autofluorescence and 0.268 (0.000, 0.730) for poorly demarcated questionably decreased autofluorescence. Conclusions Short-wavelength reduced-illuminance and conventional fundus autofluorescence imaging showed good concordance in assessing areas of definitely decreased autofluorescence. However, there was significantly higher variability between imaging modalities for assessing areas of poorly demarcated questionably decreased autofluorescence

Screening and treatment of hypertension in older adults: Less is more?

Screening and treatment of hypertension is a cornerstone of cardiovascular disease (CVD) prevention. Hypertension causes a large proportion of cases of stroke, coronary heart disease, heart failure, and associated disability and is highly prevalent especially among older adults. On the one hand, there is robust evidence that screening and treatment of hypertension prevents CVD and decreases mortality in the middle-aged population. On the other hand, among older adults, observational studies have shown either positive, negative, or no correlation between blood pressure (BP) and cardiovascular outcomes. Furthermore, there is a lack of high quality evidence for a favorable harm-benefit balance of antihypertensive treatment among older adults, especially among the oldest-old (i.e., above the age of 80 years), because very few trials have been conducted in this population. The optimal target BP may be higher among older treated hypertensive patients than among middle-aged. In addition, among frail or multimorbid older individuals, a relatively low BP may be associated with worse outcomes, and antihypertensive treatment may cause more harm than benefit. To guide hypertension screening and treatment recommendations among older patients, additional studies are needed to determine the most efficient screening strategies, to evaluate the effect of lowering BP on CVD risk and on mortality, to determine the optimal target BP, and to better understand the relationship between BP, frailty, multimorbidity, and health outcomes

Transversality of Electromagnetic Waves in the Calculus-Based Introductory Physics Course

Introductory calculus-based physics textbooks state that electromagnetic waves are transverse and list many of their properties, but most such textbooks do not bring forth arguments why this is so. Both physical and theoretical arguments are at a level appropriate for students of courses based on such books, and could be readily used by instructors of such courses. Here, we discuss two physical arguments (based on polarization experiments and on lack of monopole electromagnetic radiation), and the full argument for the transversality of (plane) electromagnetic waves based on the integral Maxwell equations. We also show, at a level appropriate for the introductory course, why the electric and magnetic fields in a wave are in phase and the relation of their magnitudes.Comment: 10 pages, 6 figure