ISOLATING THE WILD CARD OPTION

Many embedded options are difficult to value the wild card option in the Treasury bond futures contract is one of these embedded options. We illustrate how narrow theoretical bounds on the value of this option, relative to the price of the contract, may be obtained in the presence of other embedded options. Simulations suggest that the value of the wild card option is close to zero. This implies that, in this economy, a simpler pricing model of the Treasury bond futures contract, which ignores the wild card option, will result in only a small loss of accuracy.     

AGRICULTURAL PROCESSING INDUSTRIES IN THE INTERNATIONAL DIVISION OF LABOUR*

Agricultural processing industries are sometimes recommended as being particularly suitable for industrialisation programmes in developing countries. In this article, however, it is argued that such a general statement does not appear to be warranted. In a short survey some of the criteria are first discussed by which suitability of agro-processing industries can be judged. It is concluded that the contribution to development objectives of some feasible sub-sectors can easily be overestimated. It also appears that the wide disparity of characteristics of sub-sectors that belong to the category of agricultural processing industries necessitate careful examination of individual sub-sectors before judgement as to their attractiveness for developing countries is pronounced. In order to illustrate this point evaluations of the cocoa and leather industries are briefly discussed.     

How business can influence government credibility

The business community has failed to act on a fundamental given: a healthy political system is essential to a healthy economic system. A competitive economic system requires a competitive political system. Good citizens — motivated and informed — make effective leadership possible.Its ingredients require ending the escalating arms race among PACs in congressional races by reducing the amoung legislators may accept from PACs; by making small individual contributions count by matching them with the voluntary tax check off; disclosing direct and indirect lobbying expenses; and systematically reviewing our subsidy system by review spending, regulatory and tax preferences.David Cohen, president of the Social Development Corporation, a non-profit organization, served as president of Common Cause 1975–1981, and is an outstanding champion of human rights, including civil rights, consumer and urban affairs, and anti-poverty issues. Before joining the staff of Common Cause, in 1971, he worked as legislative representative for the Council for Community Action, the Industrial Union Department of the AFL-CIO and the Americans for Democratic Action. He also served as Director of Research and Collective Bargaining for the Upholsterers' International Union. A published author on the need to revitalize Congressional operations, Cohen was an Associate Fellow of Calhoun College at Yale University.