Started by Sarlock, October 08, 2013, 07:03:20 PM
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Quote from: Sarlock on October 08, 2013, 07:03:20 PMWhile playing, the impact of interest has overshadowed all over revenue streams.[...]Corporations that have excess cash generally dividend off their surplus funds to shareholders to allow them to invest it elsewhere.
QuoteI have one megalopolis of 290,000 citizens that sprawls over an area 100 tiles wide by 300 tiles long (approx 500km2) and it's only 1885.
Quote from: jamespetts on October 08, 2013, 10:08:26 PMAhh, the "dividend rate" as some have described it here aims at the effect that I intend to achieve with the cost of capital feature that I plan here (players start with nothing and have to borrow money by way of bond/long term loan rather than overdraft to invest in infrastructure).
QuoteMight there be something to be said for disabling credit interest entirely until inflation and/or cost of capital is implemented?
Quote from: ӔO on October 08, 2013, 09:47:45 PMIf the player can just give cash away to the public player (and only the public player), that would work too.
Quotewithout either (a) simulating the stock market in full (which is not feasible) or; (b) having a system so abstracted that it does not really model reality in a useful way and becomes arbitrary (preventing players from saving to invest later, for example).
Quote from: jamespetts on October 08, 2013, 11:45:44 PMHmm - it is difficult to know what to do about this dividend issue without either (a) simulating the stock market in full (which is not feasible) or; (b) having a system so abstracted that it does not really model reality in a useful way and becomes arbitrary (preventing players from saving to invest later, for example). Also, the joint stock company with paid up share capital is not the only sort of organisation capable of running a transport network, and yet dividends apply only to such companies.
Quote from: Banksie_82 on October 09, 2013, 05:00:19 AMHow about a combination of tax and dividends, each with subtle differences in their calculation but both being a progressive system.I believe that most (at least personal) tax systems around the world use a progressive system, but I'm not so sure about for companies. Obviously dividends are usually at the discretion of the company boss, but hear me out anyway.
Quote from: jamespetts on October 09, 2013, 09:21:14 AMAs to the dividend model proposed, the ideas are very interesting, but I do worry that explaining to players where their money is evaporating to might be rather challenging; does anyone have any suggestions as to how to make this readily understandable to players with only modest modifications to the GUI?
Quote from: MCollett on October 09, 2013, 05:05:51 AMCompany tax is never progressive. ...
Quote from: jamespetts on October 09, 2013, 08:50:04 PMThe real trouble that I see with dividends is that there is no satisfactory way to simulate the great flexibility that a company in reality has in deciding when to pay a dividend and how much to pay, whilst also simulating the practical limitations on that flexibility, the latter of which are especially complex.
Quote from: MCollett on October 09, 2013, 09:19:37 PMThe company owners do have flexibility in determining dividends, and modelling the real limitations on that decision would indeed be complex. But as I said further up the thread, the player in Simutrans is not really in the role of owner or chairman (or of the relevant politician, if the company is publicly-owned), but rather in that of a manager or chief executive. The dividend rate is a policy decision that is taken over the player's head, and which he just has to live with. It would perhaps be reasonable though to give new start-ups a partial dividend holiday: increment the dividend from 0% to the target rate over the first few years of the company's life, and leave it fixed thereafter.
Quote from: jameskuyper on October 09, 2013, 09:08:55 PMLook at the "Tax Rate Schedule" given on page 17.
Quote from: jamespetts on October 09, 2013, 09:33:02 PMThe trouble is that the decisions of higher up are not taken in a vacuum: deciding where and whether to invest in a large infrastructure project would be a joint decision between the senior board officials and the executives represented by the human player, for example.
QuoteA dividend holiday for startups, meanwhile, is likely to be confusing to players: how exactly is this to be explained in the GUI, and precisely what would count as a "startup"?
Quote from: jamespetts on October 10, 2013, 09:48:27 AMone relevant consideration is that different companies have different rates of issued share capital, some companies buying back their own shares to reduce the amount of dividend that must be paid, others issuing fewer shares to begin with.
Quote from: Sarlock on October 10, 2013, 02:46:51 PMMost large corporations pay a pretty consistent dividend rate between about 1% and 4% of market value. A lot of the "blue chip" large companies have been paying a steady dividend for decades and some over 100 years.While market value is subject to the whims of the stock market, it does tend to parallel net worth over time. In fact, you could safely ignore the idea of share capital entirely and base a dividend rate off of the net worth and it would nicely approximate the same effect.You could then install two simple rules:-A dividend is only issued with two successive profitable years.-A dividend is cancelled after two successive loss years.Since dividends are based off of net worth (Assets + Cash) this acts as a natural brake on runaway cash growth. If cash levels are reasonable then the dividend payout isn't that large. If cash levels grow (in the game I cite, cash was 99% of my net worth) then dividend payments grow as well and this cap future cash growth. This leaves a large company with enough cash to operate and fund capital purchases while still always being conscious of its bottom line profit.You could pick a payout percentage based on what you figure the limit of cash should be. Some multiple of assets, as our choice of dividend percentage would directly impact this.
QuoteI should be very interested in any real life data that can support a constant dividend rate when in profit as being close enough to reality not to cause distortions in the game: it strikes me that I might not know enough about the financial affairs of companies (both now and historically) to know precisely what is correct about this.