A Note on Hybrid Mortgages

We extend previous research on traditional one-year adjustable-rate mortgages (ARMs) by analyzing the performance of 3/27 hybrid instruments. Under this contract innovation, which first appeared in the mid-1990s, note rates are fixed for three years after which they convert to a traditional one-year adjustment schedule with periodic and lifetime caps. We find high rates of prepayment, particularly at time of initial rate adjustment, and relatively high rates of default, as would be consistent with the payment shock that often affects adjustable-rate loans.     

Pricing effects in Fannie Mae agency bonds

As a government-sponsored enterprise, Fannie Mae enjoys certain advantages over other firms. The extent of these advantages, while widely discussed, have not yet been fully quantified. This paper empirically examines the returns to Fannie Mae general obligation bonds under the assumptions of the Arbitrage Pricing Theory. The model provides an explicit method for estimating the risk premium on Fannie Mae bonds. The results indicate that liquidity and tax effects are important in explaining the returns to Fannie Mae bonds. The results also indicate that the market does not incorporate changes in the riskiness of the mortgage market into the returns on Fannie Mae bonds. The results provide support for the contention that Fannie Mae, as a government sponsored enterprise, enjoys a significant advantage over other firms in the capital market.     

Captivate: Building blocks for implementing active learning

In this study, the authors propose a set of key elements that impact the success of an active learning implementation: content delivery, active learning methods, physical environment, technology enhancement, incentive alignment, and educator investment. Through a range of metrics the authors present preliminary evidence that students in courses implementing these elements learn more while exerting similar effort, demonstrate greater understanding of course content, and establish closer connections with fellow students as well as instructors.     

REIT Economies of Scale: Fact or Fiction?

The real estate industry has recently witnessed significant and pervasive consolidation with further growth and consolidation generally viewed as inevitable. For example, between 1990 and 1997, growth in average net real estate investments by large REITs outpaced growth in average net real estate investments by small REITs by 13 percent. However, no systematic study of the benefits of this consolidation exists. This research studies whether or not there are gains to consolidation due to economies of scale from size, brand imaging, and informational gains from geographic specialization. Our sample consists of 41 multifamily equity REITs, for whom financial and property level data are available in the SNL REIT Database. Using this data, we construct shadow portfolios that mimic each REITs exposure to changes in local market conditions. Our results show no size economies, that branding in real estate is allusive, and that geographic specialization, in agreement with Gyourko and Nelling (1996), has no significant benefit.     

State Dependence at Internet Portals

This study offers evidence of the existence of switching costs on the Internet. It uses more flexible methods than previously possible to separate switching costs from serially correlated unobservables at Internet portals. The data contain nearly 1,000 observations per household, allowing for household-specific regressions that control for all household-specific heterogeneity. The results show that households exhibit switching costs. The loyalty generated by these costs drives a large fraction of portal visits and generates considerable revenues; however, these revenues are not large enough to justify the losses incurred by Internet portals in the 1990s while building market share. The results also suggest that random coefficients models overestimate true state dependence.     

Cruise infrastructure development in Auckland,New Zealand: a media discourse analysis (2008–2016)

The deployment of mega cruise ships is putting pressure on ports to redesign or construct new infrastructure. However, there is limited research which considers the media discourse surrounding this development over a longitudinal period. The aim of this paper is to explore how the media portrays the cruise infrastructure debate in the complex and highly contested political environment of Auckland, New Zealand. Thematic analysis was used to determine the most salient themes found in 103 published articles. Results revealed the media shaped the debate, focusing on a volatile political environment characterised by distrust, a lack of transparency and differing objectives among key stakeholders. An outcome of this research is a rich, in-depth case study of cruise infrastructure development presented through the lens of media discourse. Future research should focus on the perceptions of decision-makers, stakeholders and the community using hedging and framing to probe the media discourse surrounding cruise infrastructure development.     

Quality Measurement and Contract Design: Lessons from the North American Sugarbeet Industry

This paper examines contracts used in the North American sugarbeet industry. Though quite similar in many respects, the contracts we study vary across processing firms in the set of quality measures used to condition contract payments to growers. This is somewhat surprising, given the homogeneous nature of the processors' finished product (refined sugar). It seems unlikely that processors differ significantly in how they value the various attributes of a sugarbeet, and such a difference is perhaps the most natural reason to expect variation in the structure of quality incentives across processors. Previous attempts to explain the observed variation in sugarbeet contracts have focused on differences in organizational form across firms. In this paper, we provide an alternative explanation that relies on variation across production regions in growers' ability to control the relevant measures of sugarbeet quality.     

Jacob Mincer: A Founding Father of Modern Labour Economics

Dennis Robertson's cycle theory, particularly as developed in A Sludy of Industrial Fluclualions (1915) and Bankins Policy and the Price Lcucl (1926) is described, and the affinity between his treatment of forced saving and that of Hayek and Robbins is noted. Robertson's theoretical eclecticism and policy pragmatism are contrasted with the more rigid positions of the Austrians. It is argued that the similarities between their work stem from the common influence of English classical economics. Finally, it is suggested that Robertson, and by implication Keynes, had little to learn from the Austrians in the early 1930s.     

Empty bowls: conceptualising the role of tourism in contributing to sustainable rural food security

Abstract

It has been suggested that the food insecurity situation prevalent in many parts of the developing world could be alleviated through the creation of tourism-based alternative livelihoods. However, while tourism has been framed as a tool for poverty reduction and livelihood improvement, less attention has been paid to the direct tourism food security link. It is the intention of this article to bring tourism and food security together thereby providing a conceptual discussion for addressing the tourism-food security nexus. A model is deductively developed through review of relevant previous studies linking tourism and its relationship with development, poverty, food security, livelihoods and sustainability. The discussion examines the drivers of these relationships through drawing together extant research relating to tourism, and other livelihood activities and sectors. By doing so, the discussion highlights the key concerns for tourism to work effectively in relation to food security. The importance of sectoral and policy integration in terms of ensuring beneficial relationships across sectors is emphasized. It is concluded that understanding the tourism-food security linkage is crucial for combating poverty in general, and food insecurity specifically.     

Can message framings influence air passengers’ perceived credibility of aviation voluntary carbon offsetting messages?

Abstract

Past literature has identified low purchase rates of aviation voluntary carbon offsetting (VCO) schemes. A lack of credibility of such schemes has been identified as a key obstacle, yet little attention has been given on how to enhance perceived credibility. Using communication theory, this study examines effects of message framing on consumers’ perceived credibility of aviation VCO messages. Data were drawn from a representative sample of 1680 Australians. The results revealed that spatial distance framing influences air passengers’ perceived credibility of aviation VCO messages. Messages focusing on the influence of VCO programs on the environment of a local community obtain higher perceived credibility than those located in other countries. The study also found the interaction of spatial and temporal distance framing effects were different based on consumers’ past purchase experience. The findings suggest how airlines should design messages and refine them based on consumers’ past experience of aviation VCOs.