A Long‐Term Perspective on the Determinants of Treasury Bond Stripping Levels

We examine the proportion of individual Treasury bonds held as strips over the entire history of the STRIPS program. First, we document a secular decline in the Treasury bond stripping levels from 1985 to 2010, coincidental with the long‐term decline in the interest rates. This pattern suggests that investors purchase strips to avoid reinvestment risk and to lock in the high interest rates in the 1980s and 1990s. Second, higher coupon and longer maturity bonds are shown to be more heavily stripped. Third, the suspension of new issues of 30‐year bonds from 2001 through 2006 created a gap in the maturity structure of Treasury bonds and induced heavy stripping of 30‐year bonds issued post 2006. Our findings suggest that stripping is motivated by several factors, including interest rate risk management, tax concerns and market completion.     

Consumption compromises: Negotiation and unification within contemporary families

When cultures interact within the family, consumption decisions take on meaning beyond simply who is the decision maker. The usual compromises all spouses face are amplified when one spouse is displaced from another country. Interviews and observation are used to examine the lived-world of bi-national (where spouses are from different countries of origin) and mono-national families. Key themes emphasize how members of families insert their cultures in navigating consumption decisions and reconciling preferences. Using food consumption as context, findings reveal the extent to which individual partners relinquish part of their personal cultural identities to gain a synergistic collective identity at the family level. In discussing strategies of acknowledgment, negotiation, accommodation and unification, implications are drawn for family decision-making, family identity and consumer–brand relationship theory.     

The Impact of Community Service Learning Upon the Worldviews of Business Majors Versus Non-Business Majors at an American University

The SERVE Program at Ignatius University seeks to foster the ethical development of its participants by combining academic study of philosophy and theology with a year-long community service project. This study considered the impact of the SERVE Program upon Ignatius University students majoring in business in comparison to students pursuing majors in the liberal arts, education, and nursing. Findings from this study offer insight into the response of business students to ethical content in comparison to students pursuing degrees in other disciplines. Such findings hold significant implications for business school faculty and administrators committed to the civic and ethical development of individuals pursuing careers in business and private industry.     

Growth and Renewal in the United States: Retooling America's Economic Engine*

New research by the McKinsey Global Institute (MGI) examines the growth challenge facing the United States and explores how U.S. business and government can contribute to the economy's renewal by reinvigorating their drive toward higher productivity. As baby boomers retire and the female participation rate plateaus, the U.S. economy will receive significantly less lift from increases in the labor force and will have to rely increasingly on productivity gains to fuel growth. The report finds that the United States needs a 34% acceleration in productivity growth if it is to match the GDP growth rates of the past 20 years—and that this is possible. Three‐quarters of the necessary productivity growth acceleration can come from the efforts of private‐sector companies operating within the current regulatory and business environment. Even the best‐performing companies and sectors still have headroom to boost productivity by emulating the best practice of others and tapping into new innovations, and coming up with new innovations of their own. The remaining one‐quarter—and more—can come from government and business working together to address barriers that now limit growth. MGI lays out a seven‐point agenda for action to spur productivity.     

Modernizing innovations Analysing their use and prospects in Brazil

A recent study, conducted in Brazil, has investigated the difusion of new technologies and new organizational techniques—both important facets of the emerging technoeconomic paradigm—in the context of a newly industrializing country. In addition to examining current levels of use of these innovations in leading firms, it examines the expectations of managers as to future prospects for their use, and the implications for employment, training and competitive circumstances. As well as presenting methodological innovations, this article reports on the empirical results—indicating considerable uptake of some elements of the new paradigm, but less effort with respect to others—and develops scenarios for the future of the Brazilian economy.     

Parenthood and wildland recreation consumption: An unexplored phenomenon

The effects of parenthood on consumer decision making have not been systematically studied in prior research of the wildland recreation phenomenon. The present study utilizes data from the most recent National Survey of Recreation to assess the direct effects of parenthood on wilderness-related or wildland outdoor recreation behavior. Additionally, a framework for the conceptualization of the interrelationship between human values, demographics, attitudes toward the environment, wildland management policy variables, attitudes toward wildland recreation, and wildland recreation consumption is proposed. The findings suggest that parenthood is an important variable in understanding wildland outdoor recreation consumption. © 1993 John Wiley & Sons, Inc.     

MUTUAL FUND BROKERAGE COMMISSIONS

The brokerage commissions paid for portfolio transactions by a large sample of equity mutual funds are investigated. Median brokerage commissions measured as a percentage of net assets are 21 basis points per year with a standard deviation of 27 basis points. The commission levels are negatively correlated with fund size and positively correlated with fund turnover and expense ratio. The average brokerage commission measured as a percentage of assets traded exceeds the typical execution-only commissions for large institutional traders. This finding is consistent with many mutual fund brokerage commissions including payments for research, so-called soft dollar payments. Funds' expense ratios are positively correlated with commissions per trade, inconsistent with the idea that mutual fund managers who pay soft dollars for research have a corresponding reduction in management fees.     

Assessment of innovative software technology: developing an end-user-initiated interface design strategy

Appraisal of the perfomance of innovative products is of major interest to computer sojhare developers, so that they can identify deficiencies and successes with existing products. The identification process facilitates efective evolution of a design strategy. We address the identification issue through questionnaire analysis based on the use of the statistical technique of analysis of variance. A case study domonstrates how the experimental design chosen aids us in the task of planning next generation innovations. Since sojware vendors may have difficulty in interpreting users' perceptions of recent innovations, we show how our methodology aids the required analysis.     

Interest rate differentials on short-term securities and rational expectations of inflation

This paper tests a theorem to the effect that the difference in nominal interest rates between two securities of the same maturity but different risk is an increasing linear function of the expected rate of inflation. When inflation is modelled in a way which is rational in the sense of Muth, the evidence is highly consistent with the theorem's inferences. Estimates are also obtained of the real risk premiums that certain types of securities generate over the three-month treasury bill rate (which is assumed to be risk-free). These range from three basis points for three-month finance paper to 16 basis points for three-month Eurodollar deposits.     

A fisherian analysis of individual retirement accounts

Conclusions This paper has employed a Fisherian analysis of intertemporal choice to evaluate the use of IRA's. The analysis shows that with perfect capital markets assumptions, the presence of IRA's will generate no other effect on savings than would a simple tax rabate. Further, it shows that if the tax revenue loss due to IRA's is not accompanied by an expenditure reduction, but is financed with taxes or borrowing, rational households will still employ IRA's, but their effect on intertemporal choice will be nil. The analysis also shows that IRA's do act as a savings incentive to the extent that there are market imperfections, specifically to the degree that transactions costs are important. However, empirical evidence from the literature does not lend firm support to this possibility. The conclusion is that a market imperfection is not a firm basis on which to construct savings incentives. Finally, one can note that the same analysis applies to any tax-based savings incentive that is designed to operate by lowering the tax on interest income. The reason for this finding is that the provision of tax sheltered interest income, along with the deductibility of interest on borrowing, creates general tax arbitrage opportunities for households and that tax arbitrage opportunities do not, in general, generate greater savings in an intertemporal choice model. It follows that significant restriction or elimination of the deductibility of interest on borrowing is a prerequisite for IRA's and other tax based savings incentives to produce their intended effect.