Decision support for firm performance by real options analytics

This paper develops a real options decision support tool for raising the performance of the firm. It shows how entrepreneurs can use our intuitive tool quickly to assess the nature and type of action required for improved performance. This exploits our estimated econometric relationship between precipitators of entrepreneurial opportunities, time until exercise, and firm performance. Our 3D chromaticity plots show how staging investments, investment time, and firm performance support entrepreneurial decisions to embed, or to expedite, investments. Speedy entrepreneurial action is securely supported with this tool, without expertise in econometric estimation or in formulae for real options valuation.     

Do risk management practices work? Evidence from hedge funds

We examine hedge fund risk management practices and their association with left-tail risk during the 2008 financial crisis. Consistent with risk management practices reducing left-tail risk, funds in our sample that use formal risk models performed significantly better in the extreme down months of 2008. We find no evidence that having either position limits or a dedicated head of risk management is associated with reduced left-tail risk. Funds employing value at risk models had more accurate expectations of how they would perform in a short-term equity bear market.     

Migration,Ethnicity, and the Educational Gradient in the Jakarta Mega-Urban Region: A Spatial Analysis

The Jakarta mega-urban region (MUR) is one of the largest such regions in the world. In this article, we revisit Castles’s seminal 1967 article, based on the 1961 Population Census of Indonesia, on the educational and ethnic composition of Jakarta. Using data from the full-count 2010 Population Census, we examine spatial patterns in the educational gradients of the population across the Jakarta MUR and look to determine whether these patterns can be explained by internal migration and ethnic composition at the kecamatan (subdistrict) level. We find that population movement from the core to the outer areas has softened the historically extremely sharp gradation in educational attainment across the MUR. We show the dominance of the Sundanese and Bantenese ethnic groups in the rural hinterlands of the MUR, where the average educational attainment is relatively low, and note this question of rurality versus ethnicity when interpreting our results.     

Pushing speed? The marketing of fast and convenience food

The Menu: This paper explores the complex relationship between the marketing of fast and convenience food, and Western constructions and experiences of time in late Modernity, through a polemical analysis of a set of recent British television advertisements for a variety of brands in this sector. A cursory reading of these ads reveals some apparent contradictions in the deployment of time in fast/convenience food marketing: they seem to celebrate both speed (time as “sameness” and “continuity”) and nostalgia (time as “difference” and “discontinuity”). We go beyond a simple understanding of these alternative tropes as indices of competing brand strategies by interpreting their wider relations to the systemic and cultural vicissitudes of contemporary global capital. We conclude that the temporal articulation of fast and convenience foods presented in the ads is not in fact paradoxical, but dialectical. This dialectical relationship is an essential and continuing ideological structure of late Modernity.     

U.S. Monetary Policy: A View from Macro Theory

We use a dynamic stochastic general equilibrium model to address two questions about U.S. monetary policy: 1) Can monetary policy elevate output when it is below potential? and 2) Is the zero lower bound a trap? The model’s answer to the first question is yes it can, but the effect is only temporary and probably not welfare enhancing. The answer to the second question is more complicated because it depends on policy. It also depends on whether it is the inflation rate or the real interest rate that will adjust over the longer run if the policy rate is held near zero for an extended period. We use the Fisher equation to analyze possible outcomes for situations where the central bank has promised to keep the interest rate near zero for an extended period.     

Are individuals entering self‐employment overly optimistic? an empirical test of plans and projections on nascent entrepreneur expectations

This research examines the rationality of the expectations of nascent entrepreneurs. Consistent with conjectures regarding entry into self‐employment, I find substantial overoptimism in nascent entrepreneurs' expectations, in that they overestimate the probability that their nascent activity will result in an operating venture. Further, for those ventures that achieve operation, individuals overestimate the expected future sales and employment. To explain variations in overoptimism, I posit that those individuals who adopt an inside view to forecasting through the use of plans and financial projections, will exhibit greater ex ante bias in their expectations. Consistent with the inside view causing overoptimism in expectations, I find that the preparation of projected financial statements results in more overly optimistic venture sale forecasts. Copyright © 2010 John Wiley & Sons, Ltd.     

Policy making in London's transport planning

This article discusses several new traffic/environmental schemes proposed for London, and moves by feminist, consumer/worker and community groups to challenge conventional planning procedures. Continuous bus lanes, free or low public transport fares and pedestrianized areas are emphasized over private motoring, to result in lower traffic noise, congestion and accidents. The power of the UK's road lobby, the limitations of traditional professional planners and a lack of open debate are offered as explanations for the resistance of London's planners to enacting such schemes. The author concludes that central government policy of minimizing public transport subsidy and providing roads instead for private transport has led to hostility to more popular plans.     

Book Reviews

Miyohei Shinohara and Fu-Chen Lo (eds), Global Adjustment and the Future of Asian-Pacific Economy, Kuala Lumpur and Tokyo: Asian and Pacific Development Centre and Institute of Developing Economies, 1989, pp. 585 + xxi, npg.

Frank J. Costa, Ashok K. Dutt, Laurence J.C. Ma and Allen G. Noble, Urbanization in Asia: Spatial Dimensions and Policy Issues, Honolulu: University of Hawaii Press, 1989. US$44.

W. de Jong and F. van Steenbergen, Town and Hinterland in Central Java, Jogyakarta: Gadjah Mada University Press, 1987, pp. 250 + iv. Paper: Rp 7,000.

Bruce Mckern and Praipol Koomsup (eds), The Minerals Industries of Asean and Australia: Problems and Prospects, Sydney: Allen and Unwin, 1987, pp. 378 + xviii. Paper: $29.95.

Bruce Mckern and Praipol Koomsup (eds), Minerals Processing in the Industrialisation of Asean and Australia, Sydney: Allen and Unwin, 1988, pp. 388 + xvii. Paper: $29.95.

Mohamed Ariff and Tan Loong-Hoe (eds), The Uruguay Round: Asean Trade Policy Options, Singapore: Institute of Southeast Asian Studies, 1988, pp. 211 + xvi.

William R. Cline, The Future of World Trade in Textiles and Apparel, Institute for International Economics, Washington, 1987, pp. 325 + xiv. US$20.

Peter Drysdale, International Economic Pluralism: Economic Policy in East Asia and the Pacific, Sydney: Allen and Unwin, 1988, pp. 294. Paper $20; Cloth: $30.

Helen Hughes (ed.), Achieving Industrialization in East Asia, Cambridge: Cambridge University Press, 1988, pp. 377 + xviii. $59.50.

BRIEFLY NOTED: J. C. Conroy, Shelter for the Homeless: Asian-Pacific Needs and Australian Responses, Canberra: Australian Council for Overseas Aid Development Dossier No 22,1987, pp. 141 + vi.