Between 1998 and 2001, the aim was to achieve a return on employed capital that was at least equal to its cost (8.5%).
For years, hedge funds borrowed money in Japan at next to nothing and employed the capital in the fixed-income sector here.
The lord and society would have been worse off had his concept of fairness been to give each servant the same amount since the other two servants employed the capital and returned twice what they had been given.
In recent years, Unocal's average return on capital employed has been higher than ChevronTexaco's, 9.4% vs. 8.7%.
Disclosure simply allows a proper understanding and control over the effective use of capital employed as executive compensation.
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Once all the spare labour was used up and capital employed per worker reached rich-country levels, he argued, Asia's growth would slump.
For example some companies have well above average returns to capital employed.
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Granted, the return on capital employed on the Phillips 66 side has improved dramatically, from 1% in 2009 to 5% in 2010 to 13% in 2011.
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Regulated margins on capital employed, all that sort of thing.
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This is the measure of output (taken as operating profit after tax and some other adjustments) less input (taken as the annual rental charge on the total capital employed, both debt and equity).
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When there is general confidence in the uninter-rupted goings on of economic life, confidence in the legal framework under which economic life operates and in the essential integrity and fairness of governments, men with capital prefer to have their capital employed.
In the long term, when equilibrium is reached (which of course it never is but the trend is generally towards it) the profit made by each competitor will be, on average, just enough to keep the capital employed which each competitor is using.
With help from Jeffrey Parkhurst, managing director of business strategy at Mindshare, a WPP-owned media agency, we valued the brands by looking at brand earnings over the past three years, subtracting a charge for the capital employed and then taking a percentage of earnings based on the role brands play in each industry.
Fortunately, recently, professors Nick Bloom, Toby Kretschmer, and John van Reenen (from Stanford, the University of Munich, and the London School of Economics) conducted an extensive study examining the effect of family-friendly practices on hard variables such as firm sales per employee and return on capital employed, using a large database of firms from the US, the UK, Germany, and France.
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Then, as banks redirect the capital previously employed in the carry trade into commercial loans, economic growth will increase, but the velocity of money will also rise.
It is not that the employees of the company being taxed get paid less: it is that less capital being employed in toto leads to lower wages for all in the country.
Also, the capacity constraints imposed by certain investment strategies mean a limit may exist on how much capital can be employed by a particular hedge fund without negatively impacting its returns and, thereby, the lucrative performance fee accruing to the fund manager.
Once the top rate of capital-gains tax is cut to 20%, this discrepancy widens, raising the incentive for people, particularly business owners and the self-employed, to disguise their income as capital gains.
But Conwell also spoke of the forces that would seek to foment hostility between those that have capital, and the laborers that would be employed with it.
The increase in market capital has helped to grow thousands of corporations that have employed millions of workers and contribute trillions in taxes to the Federal and State governments.
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The consequences of decisions made in the capital are lucidly explored, and a similar fanning-out technique is employed in the chronicle of the second world war.
Some observers now feel that in view of this reduced risk, the regulatory capital banks are required to hold may be excessive and could be better employed elsewhere.
The Obama administration also saw the passage of the Small Business Job Act, which provided additional small business tax cuts, zero capital gain taxes on important small business investments held for five years or more, deduction for self-employed health insurance costs and increased access to lending for small business owners.
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