Wealth effects of dividend regulation: Evidence from China

By exploring a natural experiment where the Chinese regulatory body introduced a dividend regulatory change in 2012, this article investigates the wealth effects of dividend regulation which increases firms’ dividends. I find that firms’ share price reacted positively (negatively) to regulatory events increasing (decreasing) investors’ expectation of dividends. The effects are more pronounced for firms with low dividends or domiciled in weak legal environments, robust to different research designs. The findings are consistent with the notion that low dividends in China are a manifestation of implicit contract failure. Dividend regulation provides remedies to low investor protection arising from weak legal environments. JEL Classification: G14, G35, G38, K22

Peter Singer’s “Famine, Affluence, and Morality”: Three Libertarian Refutations

Peter Singer’s famous and influential article is criticised in three main ways that can be considered libertarian, although many non-libertarians could also accept them: 1) the relevant moral principle is more plausibly about upholding an implicit contract rather than globalising a moral intuition that had local evolutionary origins; 2) its principle of the immorality of not stopping bad things is paradoxical, as it overlooks the converse aspect that would be the positive morality of not starting bad things and also thereby conceptually eliminates innocence; and 3) free markets – especially international free trade – have been cogently explained to be the real solution to the global “major evils” of “poverty” and “pollution”, while “overpopulation” does not exist in free-market frameworks; hence charity is a relatively minor alleviant to the problem of insufficiently free markets. There are also various subsidiary arguments throughout.

Older Workers and the Gig Economy

As the workforce ages, how will the work lives of older people evolve? One way to ease into retirement is to move to the gig economy where workers choose hours and intensity of work that fit their needs and capabilities. However, older workers are often reaping the benefits of the latter end of an implicit contract while gig economy workers are paid their marginal product. We show that age/earnings profiles in the traditional labor market are different than for Uber drivers. While the move to the gig economy generates flexibility, older workers are paid less than their younger coworkers.