DIVIDEND (Lat. dividendum, a thing to be divided), the net profit periodically divisible among the proprietors of a joint-stock company in proportion to their respective holdings of its capital. Dividend is not interest, although the word dividend is frequently applied to payments of interest; and a failure to pay dividends to shareholders does not, like a failure to pay interest on borrowed money, lay a company open to being declared bankrupt. In bankruptcy a dividend is the proportionate share of the proceeds of the debtor’s estate received by a creditor. In England, the Companies Act 1862 provided that no dividend should be payable except out of the profits arising from the business of the company, but, in the case of companies incorporated by special act of parliament for the construction of railways and other public works which cannot be completed for a considerable time, it is sometimes provided that interest may during construction be paid to the subscribers for shares out of capital. Dividends (excluding occasional distributions in the form of shares) are ordinarily payable in cash. Most companies divide their capital into at least two classes, called “preference” shares and “ordinary” shares, of which the former are entitled out of the profits of the company to a preferential dividend at a fixed rate, and the latter to whatever remains after payment of the preferential dividend and any fixed charges. Before, however, a dividend is paid, a part of the profits is often carried to a “reserve fund.” The dividend on preference shares is either “cumulative” or contingent on the profits of each separate year or half year. When cumulative, if the profits of any one year are insufficient to pay it in full, the deficiency has to be made good out of subsequent profits. A cumulative preferential dividend is sometimes said to be “guaranteed,” and preferential dividends payable by all English companies registered under the Companies Acts 1862 to 1908 are cumulative unless stipulated to be otherwise. Certain public companies are forbidden by parliament to pay dividends in excess of a prescribed maximum rate, but this restriction has been happily modified in some instances, notably in the case of gas companies, by the institution of a sliding scale, under which a gas company may so regulate the price of gas to be charged to consumers that any reduction of an authorized standard price entitles the company to make a proportionate increase of the authorized dividend, and any increase above the standard price involves a proportionate decrease of dividend. Dividends are usually declared yearly or half-yearly; and before any dividend can be paid it is, as a rule, necessary for the directors to submit to the shareholders, at a general meeting called for the purpose, the accounts of the company, with a report by the directors on its position and their recommendation as to the rate of the proposed dividend. The articles of association of a company usually provide that the shareholders may accept the director’s recommendation as to dividend or may declare a lower one, but may not declare a higher one than the directors recommend. Directors frequently have power to pay on account of the dividend for the year, without consulting the shareholders, an “interim dividend,” which on ordinary shares is generally at a much lower rate than the final or regular dividend. An exceptionally high dividend is often distributed in the shape of a dividend at the usual rate supplemented by an additional dividend or “bonus.” Payment of dividends is made by means of cheques sent by post, called “dividend warrants.” All dividends are subject to income-tax, and by most companies dividends are paid “less income-tax,” in which case the tax is deducted from the amount of dividend payable to each proprietor. When paid without such deduction a dividend is said to be “free of income-tax.” In the latter case, however, the company has to make provision for payment of the tax before declaring the dividend, and the amount of its divisible profits and the rate of dividend which it is able to declare are consequently to that extent reduced. In respect of consols and certain other securities, holders of amounts of less than £1000 may instruct the Bank of England or Bank of Ireland to receive and invest their dividends. With few exceptions, the prices of securities dealt in on the London Stock Exchange include any accruing dividend not paid up to the date of purchase. At a certain day, after the dividend is declared, the stock or share is dealt in on the Stock Exchange, as ex dividend (or “x. d.”), which means that the current dividend is paid not to the buyer but to the previous holder, and the price of the stock is lower to that extent. The expression “cum dividend” is used to signify that the price of the security dealt in includes a dividend which, in the absence of any stipulation, might be supposed to belong to the seller of the security. On the New York Stock Exchange the invariable practice is to sell stock with the “dividend on” until the company’s books are closed, after which it is usually sold “ex dividend.”
(S. D. H.)
DIVIDIVI, the native and commercial name for the astringent pods of Caesalpinia coriaria, a leguminous shrub of the suborder Caesalpinieae, which grows in low marshy tracts in the West Indies and the north of South America. The plant is between 20 and 30 ft. in height, and bears white flowers. The pods are flattened, and curl up in drying; they are about ¾ in. broad, from 2 to 3 in. long and of a rich brown colour. Dividivi was first brought to Europe from Caracas in 1768. It contains about 30% of ellagitannic acid, whence its value in leather manufacture.
DIVINATION, the process of obtaining knowledge of secret or future things by means of oracles, omens or astrology. The root of the word, deus (god) or divus, indicates the supposed source of the soothsayer’s information, just as the equivalent Greek term, μαντική, indicates the spiritual source of the utterances of the seer, μάντις. In classical times the view was, in fact, general, as may be seen by Cicero’s De divinatione, that not only oracles but also omens were signs sent by the gods; even the astrologer held that he gained his information, in the last resort, from the same source. On the side of the Stoics it was argued that if divination was a real art, there must be gods who gave it to mankind; against this it was argued that signs of future events may be given without any god.
Divination is practised in all grades of culture; its votaries range from the Australian black to the American medium. There is no general agreement as to the source of the information; commonly it is held that it comes from the gods directly or indirectly. In the Bornean cult of the hawk it seems that the divine bird itself was regarded as having a foreknowledge of the future. Later it is regarded as no more than a messenger. Among the Australian blacks, divination is largely employed to discover the cause of death, where it is assumed to be due to magic; in some cases the spirit of the dead man is held to give the information, in others the living magician is the source of the knowledge. We find moreover a semi-scientific conception of the basis of divination; the whole of nature is linked together; just as the variations in the height of a column of mercury serve to foretell the weather, so the flight of birds or behaviour of cattle may help to prognosticate its changes; for the uncultured it is merely a step to the assumption that animals know things which are hidden from man. Haruspication, or the inspection of entrails, was justified on similar grounds, and in the case of omens from birds or animals, no less than in astrology, it was held that the facts from which inferences were drawn were themselves in part the causes of the events which they foretold, thus fortifying the belief in the possibility of divination.
From a psychological point of view divinatory methods may be classified under two main heads: (A) autoscopic, which depend simply on some change in the consciousness of the soothsayer; (B) heteroscopic, in which he looks outside himself for guidance and perhaps infers rather than divines in the proper sense.
(A) Autoscopic methods depend on (i.) sensory or (ii.) motor automatisms, or (iii.) mental impressions, for their results. (i.) Crystal-gazing (q.v.) is a world-wide method of divining, which is analogous to dreams, save that the vision is voluntarily initiated, though little, if at all, under the control of the scryer. Corresponding to crystal-gazing we have shell-hearing and similar methods, which are, however, less common; in these the information is gained by hearing a voice. (ii.) The divining rod (q.v.) is the best-known example of this class; divination depending on automatic movements of this sort is found at all stages of culture; in Australia it is used to detect the magician who has caused the death of a native; in medieval and modern times water-divining or dowsing has been largely and successfully used. Similar in principle is coscinomancy, or divining by a sieve held suspended, which gives indications by turning; and the equally common divination by a suspended ring, both of which are found from Europe in the west to China and Japan in the east. The ordeal by the Bible and key is equally popular; the book is suspended by a key tied in with its wards between the leaves and supported on two persons’ fingers, and the whole turns round when the name of the guilty person is mentioned. Confined to higher cultures on the other hand, for obvious reasons, is divination by automatic writing, which is practised in China more especially. The sand divination so widely spread in Africa seems to be of a different nature. Trance speaking, on the other hand, may be found in any stage of culture and there is no doubt that in many cases the procedure of the magician or shaman induces a state of auto-hypnotism; at a higher stage these utterances are termed oracles and are believed to be the result of inspiration (q.v.). (iii.) Another method of divination is by the aid of mental impressions; observation seems to show that by some process of this sort, akin to clairvoyance (q.v.), fortunes are told successfully by means of palmistry or by laying the cards; for the same “lie” of the cards may be diversely interpreted to meet different cases. In other cases the impression is involuntary or less consciously sought, as in dreams (q.v.), which, however, are sometimes induced, for purposes of divination, by the process known as incubation or temple sleep. Dreams are sometimes regarded as visits to or from gods or the souls of the dead, sometimes as signs to be interpreted symbolically by means of dream-books, which are found not only in Europe but in less cultured countries like Siam.
(B) In heteroscopic divination the process is rather one of inference from external facts. The methods are very various. (i.) The casting of lots, sortilege, was common in classical antiquity; the Homeric heroes prayed to the gods when they cast lots in Agamemnon’s leather cap, and Mopsus divined with sacred lots when the Argonauts embarked. Similarly dice are thrown for purposes of sortilege; the astragali or knucklebones, used in children’s games at the present day, were implements of divination in the first instance. In Polynesia the coco-nut is spun like a teetotum to discover a thief. Somewhat different are the omens drawn from books; in ancient times the poets were often consulted, more especially Virgil, whence the name sortes virgilianae, just as the Bible is used for drawing texts in our own day, especially in Germany. (ii.) In haruspication, or the inspection of entrails, in scapulomancy or divination by the speal-bone or shoulder-blade, in divination by footprints in ashes, found in Australia, Peru and Scotland, the voluntary element is prominent, for the diviner must take active steps to secure the conditions necessary to divination. (iii.) In the case of augury and omens, on the other hand, that is not necessary. The behaviour and cries of birds, and angang or meeting with ominous animals, &c., may be voluntarily observed, and opportunities for observation made; but this is not necessary for success. (iv.) In astrology we have a method which still finds believers among people of good education. The stars are held, not only to prognosticate the future but also to influence it; the child born when Mars is in the ascendant will be war-like; Venus has to do with love; the sign of the Lion presides over places where wild beasts are found. (v.) In other cases the tie that binds the subject of divination with the omen-giving object is sympathy. The name of the life-index is given to a tree, animal or other object believed to be so closely united by sympathetic ties to a human being that the fate of the latter is reflected in the condition of the former. The Polynesians set up sticks to see if the warriors they stood for were to fall in battle; on Hallowe’en in our own country the behaviour of nuts and other objects thrown into the fire is held to prognosticate the lot of the person to whom they have been assigned. Where, as in the last two cases, the sympathetic bond is less strong, we find symbolical interpretation playing an important part.