This term, I'm teaching intermediate corporate finance. One of the class discussions was about the firm's decisions about the allocation of their retained earnings. Well, it turns out that more and more of such allocations is shifting towards dividend payments and share repurchase. On the politics side, with governments' support of research and development projects, firms find it more appealing to spend cash on repurchase and thus lobby for more government funding particularly for the kind of research that they had to traditionally fund out of their own pockets. Intel, for example, spends four times on share buyback as it receives from the government in the form of the research funds. This video on HBS is enlightening [link].
G Flat
Hosein Maleki's Notes on Economics, History and Art
Saturday, 28 November 2015
Sunday, 14 October 2012
Iran's Crippled Currency
Find my recent commentary on the "Project
Syndicate" website:
While Iran’s leaders have often downplayed the sanctions’
impact, President Mahmoud Ahmadinejad has recently cited them as the primary
culprit behind Iran’s economic turmoil. But Iran has faced similar economic
difficulties before – in the 1980’s, oil exports fell significantly amid the
country’s eight-year war with Iraq, and in 1986-2000 global oil prices were
extremely low – and handled them relatively well. Four factors have made the
oil embargo particularly unbearable today.
Read the full article on this link:
Friday, 28 September 2012
The Dust Question
I wrote this article for the "Project Dust" website. Project Dust addresses the problem of dust (dust storms) in the Middle East. - H. M
-- “Seeing is believing”
We cannot fully appreciate the effects of climate change,
most probably because it all happens hundreds of miles away. I have never seen
an iceberg; I don’t know what it means that they are being eradicated. Many
people have not seen species at the verge of extinction, clearly making it hard
for them to understand the true problem. Floods always happen for certain
countries and always other people die, forgetting that it is only a matter of
time before we, inevitably and forcefully, join the “others”.
I started learning about a persistent effect of a huge
climate change right when I was almost being buried under a sand storm in one
of my visits of my home town: Ahvaz; one of the seven largest cities of Iran
and the capital of the main oil-producing state in the country. It was 2005. My
first impression was that it is only a mistake: such a thing has rarely
happened before and surely, it is not going to last. I was undeniably wrong as
the situations began to exacerbate dramatically. The dust storms began to get
more frequent, and more severe. The semi-green city with the largest river in the
region and a flourishing agriculture now was constantly in the chamber of a
blinding dust. Consequences were beyond imagination: flights started to cancel,
governmental offices started to announce emergency shutdowns, and the schools
started to have a constant challenge whether class cancellations are going to
be a routine. And worst of all, new diseases began to appear and others
worsened, among those: nose bleeding, a higher rate of lung and heart diseases.
The air pollution began to surpass the normal levels:
starting from 9 times and even reaching 50 times the standard level. More than
4 million people were directly affected. There were rumours that the dust may
contain radioactive particles: leading to a widespread panic. The storms began
to happen repeatedly: even twice a week. I remember watching a football game on
TV, played in a moderate dust, when some players began nose bleeding, others
coughing and complaining the lack of oxygen in the playground. Historical
places from 7000 years ago, as the signs of the earliest civilizations on
earth, were going down under tons of dust. I can go on and on and am not sure
when the list is going to end. The situation was severe. And now, it is even
worse.
It is one of the many examples of climate change that
challenges both earth and the human life. No final solutions yet. No
improvements. It is also a wakeup call for me and many others: demanding a
spread of the word, and necessitating to finally “do something”, especially
when we have seen and felt with all our senses a clear and present danger and a
worsening human conditions. We have always heard about water projects, draught
and hunger. I believe the growing dust storms in the Middle East and other
parts of the world can be an alarm for a new global challenge.
No one knows exactly why this phenomenon persists. Some
related it to the process of desertification, some say it is due to the Iraqi
lagoons drying up, and others may have other ideas. To the extent of my
knowledge, no thorough studies have been made. Recently, the phenomenon is not
only limited to my hometown anymore. It is now widespread over almost all
Iranian map, large parts of Iraq, and I guess other countries in the Persian
Gulf. Affecting the daily lives of millions, it now demands an exhaustive
analysis from a variety of perspectives. The economic and sociological
consequences of this climate change are of main interest: shut down of
industries, immigrations, health costs, costs to a variety of businesses,
besides social panic, depression, and decrease in life expectancy are some
observations, demanding more insight. The phenomenon itself needs particular
attentions: how we can stop it, or stop similar phenomena in other parts of the
world.
The “Project Dust” is an initiative to address this growing
concern. Its multinational context, severity, the number of people involved,
the vast land being affected, and its persistence besides its newness makes it
of particular importance. “Project Dust” encourages researchers and
institutions all over the world to consider this phenomenon, define research
projects and recommends funding for related studies. Its goal is to study, understand and enter
proper actions in order to stop dust storms in the Middle East and especially
the Persian Gulf area. Project Dust is at its early steps.
--
Photo: Reza Mohseni
--
Photo: Reza Mohseni
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