We consider a risk model with threshold strategy, where the insurance company pays off a certain percentage of the income as dividend whenever the current surplus is larger than a given threshold. We investigate the ruin time, ruin probability and the total dividend, using methods and results from queueing theory.

In many developing countries and in East Asia’s NIEs, demographic change has favored economic growth. A demographic dividend or demographic window arises because the working-age populations are growing more rapidly than the number of consumers. This provides an extra boost to per capita income. As is widely appreciated, the demographic dividend is transitory. In the coming decades, the number o...

While American calls on non-dividend-paying stocks may be valued as European, there is no completely explicit exact solution for the values of American puts. We use a technique called randomization to value American puts and calls on dividend-paying stocks. This technique yields a new semiexplicit approximation for American option values in the Black-Scholes model. Numerical results indicate th...

This paper provides new evidence on the predictive power of dividend yields for U.S. aggregate stock returns. Following Miller and Modigliani, we construct a measure of the dividend yield that includes all cash flows to shareholders. We show that this alternative cash-flow yield has strong and stable predictive power for returns, and appears robust to a battery of tests that have been proposed ...