Housing-Price Cycles and Prepayment Rates of U.S. Mortgage Pools

Empirical mortgage prepayment models generally have trouble explaining differences in mortgage-prepayment speeds among pools with similar interest rates on the underlying mortgages. In this article, we model some of the sources of termination heterogeneity across mortgage pools, particularly the role of regional variations in housing prices in generating atypical prepayment speeds. Using a sample of Freddie Mac mortgage pools from 1991 to 1998, we compare two classes of empirical models: a rational option-pricing model using a backward-solving pricing algorithm and an empirical hazard model. In both empirical estimation strategies, we find evidence that differences in house-price dynamics across regions are an important source of between-pool heterogeneity. This finding is then shown to be robust to alternative ways of parameterizing pool heterogeneity in mortgage termination models.     

The underpricing of initial public offerings: A theoretical and empirical reconsideration of the adverse selection hypothesis

In this paper we generalize Rock's theory regarding the underpricing of IPOs. In Rock's model, informed investors have a firm-specific informational advantage pertaining to a firm's cash flow. We derive the new results that the level of beta and the size of the market risk premium positively affect underpricing. These implications extend the adverse selection theory and further distinguish this theory from the current state of signalling theories of underpricing. The results put the “hot and cold” issue markets phenomenon in a theoretical context. Empirical results are consistent with the theoretical propositions and provide support for Rock's theory of underpricing.     

Free trade, factor returns, and factor accumulation

A model of development is studied in which physical capital and unskilled labor are good substitutes, and skilled labor is complementary to the resulting aggregate. Growth in a closed economy is compared with two open regimes. Inflows of physical capital only reduce the interest rate and raise both wage rates. The skilled wage rises more sharply, however, increasing the skill premium and accelerating human capital accumulation. Full integration with a larger and more developed neighbor also reduces the interest rate and raises both wage rates, but in this case the skill premium falls and human capital accumulation changes very little.     

Quality indicators for academic nursing primary care centers

ANCs, by definition, deliver more than clinical services to patients and communities. The unique identifier that separates ANCs from other primary care/ambulatory care centers is the educational service they offer to students and other faculty in the school of nursing to which they belong. Therefore, measuring the quality of an ANC must include a measurement of the educational properties that it possesses in addition to the usual quality measurements by such organizations as AAAHC, JCAHO, CHAP, and AAACN. Unless these properties are included and measured by an ANC, it becomes difficult to justify the existence of such a clinic within a school of nursing. ANCs are encouraged to develop quality evaluation programs aimed at evaluating the educational aspects as well as the administrative and clinical aspects of their operations.     

Targeting Child Labor in Debt Bondage: Evidence, Theory, and Policy Implications

Despite recent multilateral efforts to single out child laborin debt bondage as one of the worst forms of child labor, severalimportant questions have yet to be addressed: How pervasiveis the phenomenon? Are there systematic correlations betweenthe incidence of children in debt bondage and the economic,legislative, and financial development indicators of the economy?How does an understanding of these correlates affect the waynational and international policy measures aimed at targetingthis form of child labor are perceived? This article addresseseach of these questions. The empirical findings suggest strongcorrelation between the likelihood of the incidence of childlabor in debt bondage with the stage of development of an economy,the stage of financial development, and enforcement of corelabor rights. Building on this evidence, the article presentsa theoretical model that highlights the drawbacks and meritsof a number of policies aimed at putting checks on child laborin debt bondage.     

Can Consumers Forgo the Need to Touch Products? An Investigation of Nonhaptic Situational Factors in an Online Context

Touch is an important source of information for consumers, and there is much to learn about its role in an online purchase decision context where the ability to touch products is not (at least currently) possible. The present investigation examines three nonhaptic situation‐specific factors that moderate the relationship between haptic motivation and consumer responses. The results indicate that positive mood, price promotions, and level of situation‐specific product expertise are influential, yielding greater purchase intentions and product judgment confidence when touch is not available. Additionally, the findings of the investigation suggest that imagining a Web site is comparable to actually viewing a Web site. Several implications for consumer behavior research and online marketers are discussed.