Face-to-face donor cancellation rates (attrition): establishing a benchmark

• Face-to-face fundraising, both on the street and on the doorstep, has taken place in the UK for well over a decade. Its success can be said to be dependent on the balance between acquisition costs and income generated for the charity. Whilst the former is easy to measure, the latter has proven much harder to predict. This paper reports the results of a survey of the payment behaviour of over 377 000 face-to-face recruited regular giving donors, to 30 charities. Whilst charity brand awareness was found not to have a significant impact on levels of attrition, the region in which campaigns were run, together with the level of the ask and the cause of the charity, were all found to have a significant effect on attrition. As a result of improvements in both attrition and average gift from 2004 to 2006, charities have reported increased income from their street and door face-to-face campaigns.

Copyright © 2009 John Wiley & Sons, Ltd.     

Alternative measures of rates of return: Some empirical evidence

Firm profitability is measured in most cases by an accounting rather than by the theoretically superior economic (or internal) rate of return. This paper explores the relationship between accounting and internal rates of return using COMPUSTAT data for 1013 large industrial firms over a 20-year period. The research was motivated by the controversy ongoing between scholars concerning the validity of the accounting rate of return as a proxy for economic profit. The method used in this paper is different from previous research in that cash flow profiles are estimated instead of being assumed. The results, while generally supporting the contention that accounting rates of return are poor proxies for underlying economic rates of return, also provide evidence that the distortions are not so great as to render them useless for performance measurement and managerial decision-making purposes.     

The inclusion of indirect social benefits in project rates of return

The author uses input-output techniques to estimate the backward (induced) and forward (stemming) linkage effects of a project. He shadow-prices the export, import and wages vectors in the first and third quadrants of the input-output table. He then adds or subtracts the resulting social net gains or losses arising in the linked sectors to the net benefit stream of the project which initially stimulates these indirect effects.Reasons for doing this are given and reservations with regard to the methodology are presented. The technique is, perhaps, best used to show what types of schemes are most likely to have the higher overall social rates of return rather than as a methodology to be incorporated in individual project appraisals. This may be more useful at the project identification rather than the project appraisal stage.     

What can regulators regulate? The case of electric utility rates of return

The efficacy of electric utility regulation has not been finally determined. This study assesses the impact of commission regulation on the level of earnings realized by electric power utility firms. Time series data for the individual electric firms operating in Florida, Iowa and Mississippi were used in this analysis. These are the only three states regulated since World War II and it was possible to compare profit rates for the individual firms before and after commission regulation was instituted. The results show that regulation has lowered profits in some cases. However, there appears to be significant randomness in the process.     

Bond risk, bond return volatility, and the term structure of interest rates

This paper explores the time variation in the bond risk, as measured by the covariation of bond returns with stock returns and consumption growth, and in the volatility of bond returns. A robust stylized fact in empirical finance is that the spread between the yields on long- and short-term bonds forecasts future excess returns on bonds at varying horizons positively; in addition, the short-term nominal interest rate forecasts both the stock return volatility and the exchange rate volatility positively. This paper presents evidence that movements in both the short-term nominal interest rate and the yield spread are positively related to changes in the subsequent realized bond risk and bond return volatility. The yield spread appears to proxy for business conditions, while the short rate appears to proxy for inflation and economic uncertainty. A decomposition of bond betas into a real cash flow risk component and a discount rate risk component shows that yield spreads have offsetting effects in each component. A widening yield spread is correlated with a reduced cash-flow (or inflationary) risk for bonds, but it is also correlated with a larger discount rate risk for bonds. The short rate only forecasts the discount rate component of the bond beta.     

Beyond belief: A benchmark for human resources

Many Human Resource (HR) professionals feel and believe that they have made progress during the 1980s. Unfortunately, without data to benchmark progress, assessments must depend on perception rather than evidence. To move beyond belief towards a national HR database, this article reports research on over 10,000 individuals in 1200 businesses in 91 firms. It establishes a benchmark for HR practices and HR professionals. It also highlights areas where HR professionals may focus attention to become more successful as business partners.     

Portfolio optimization for an investor with a benchmark

The most common equity mandate in the financial industry is to try to outperform an externally given benchmark with known weights. The standard quantitative approach to do this is to optimize the portfolio over short time horizons consecutively, using one-period models. However, it is not clear that this approach actually yields good performance in the long run. We provide a theoretical justification to this methodology by verifying that applying the one-period benchmark-relative mean-variance portfolio, i.e., the industry standard optimal portfolio, continuously is in fact the solution to a specific continuous time portfolio optimization problem: a maximum expected utility problem for an investor who is compared against a benchmark and evaluates her performance based on exponential utility at a deterministic future date.     

Classification and benchmark of City Logistics measures: an empirical analysis

Urban freight distribution accounts for a significant share of pollution and congestion in urban areas. To reduce these negative impacts, municipalities have implemented several City Logistics (CL) measures. This paper presents the empirical analysis of a dataset of 70 European cities that have been piloting or rolling out a CL measure, to provide an updated indication of the status of CL initiatives and analyse the diffusion of CL internationally. The research objective is also to help understand the contextual factors might explain their introduction. To this end, a set of City Logistics Indices (CLI) is used as indicators of the breadth and number of CL measures implemented in a city. A statistical correlation of these CLIs with respect to a set of independent variables, namely the contextual factors, is also performed. Results reveal that the level of pollution, the diffusion of e-commerce and GDP are important drivers of CL deployment.     

Fixed capital and internal rate of return

For a neo-Austrian process of production, more generally multisectoral fixed capital models, it is shown that the maximum rate of growth and the minimum rate of interest are both equal to the internal rate of return. This von Neumann type equality is here obtained in absence of truncation, i.e., free disposal of fixed capital. If several internal rates of return coexist, the economically significant one is the maximal one. This result provides theoretical grounds for the internal rate of return criterion in infinite horizon.     

Agent based-stock flow consistent macroeconomics: Towards a benchmark model

The paper moves from a discussion of the challenges posed by the crisis to standard macroeconomics and the solutions adopted within the DSGE community. Although several recent improvements have enhanced the realism of standard models, we argue that major drawbacks still undermine their reliability. In particular, DSGE models still fail to recognize the complex adaptive nature of economic systems, and the implications of money endogeneity. The paper argues that a coherent and exhaustive representation of the inter-linkages between the real and financial sides of the economy should be a pivotal feature of every macroeconomic model and proposes a macroeconomic framework based on the combination of the Agent Based and Stock Flow Consistent approaches. The papers aims at contributing to the nascent AB-SFC literature under two fundamental respects: first, we develop a fully decentralized AB-SFC model with several innovative features, and we thoroughly validate it in order to check whether the model is a good candidate for policy analysis applications. Results suggest that the properties of the model match many empirical regularities, ranking among the best performers in the related literature, and that these properties are robust across different parameterizations. Second, the paper has also a methodological purpose in that we try to provide a set or rules and tools to build, calibrate, validate, and display AB-SFC models.     

A return to incomes policy?*

The Government's continuing difficulties in controlling the money supply and determination to use cash limits to control the level of public sector pay settlements have renewed cause for a return to a form of incomes policy covering both the public and private sectors. In this article Brian Towers examines the nature of incomes policy and the importance of comparability and collective bargaining structure in its implementation and discusses the form which a viable future policy should take.     

物业管理应该回归本真

近年来,由于成本上涨及质价相符的定价机制不健全,行业发展出现了困难,业内不少企业纷纷开始探寻自己的应对之策,譬如开展延伸服务、建设幸福社区及智慧社区等等,但业内对此也有不同的声音,本文即是其中之一。本文作者的观点不代表中国物业管理协会和本刊的观点,我们欢迎不同的观点和意见来参与这一问题的讨论。     

Indicator selection and stock return predictability

We propose a momentum-determined indicator-switching (MDIS) strategy, simple and effective, to improve the predictability of stock returns, which can effectively select predictors. Empirical results indicate that the stock return forecasts generated by the MDIS strategy are statistically and economically significant. And we find that super long-term momentum of predictability (SMoP) exists in predictive factors. That is, in a long period of time in the past, the best predictor among a series of factors has best prediction ability in the future. We also design restricted momentum-determined indicator-switching (RMDIS) strategy when considering economic constrain. It is robust for the prediction performance of this strategy using a series of extension and robustness test. Success of the RMDIS strategy is also seen in using technical indicators to forecast stock returns.     

The expected real return to equity

The expected return to equity – typically measured as a historical average – is a key variable in the decision making of investors. A recent literature uses analysts' forecasts, investor surveys or present-value relationships and finds estimates of expected returns that are sometimes much lower than historical averages. This study extends the present-value approach to a dynamic optimizing framework. Given a model that captures this relationship, one can use data on dividends, earnings and valuations to infer the model-implied expected return. Using this method, the estimated expected real return to equity ranges from 4.9% to 5.6% . Furthermore, the analysis indicates that expected returns have declined by about 3 percentage points over the past 40 years. These results indicate that future returns to equity may be lower than past realized returns.     

The cross section of Chinese commodity futures return

This paper investigates the cross-section of expected commodity futures returns in China using a large panel of 13 individual factors. We find that 6 out of 13 individual factors produce positive and significant returns. To aggregate the information among these factors, we apply not only the traditional Fama-MacBeth regression (FM), but also a set of alternative methods, including the forecast combination method (FC), principal component analysis (PCA), principle component regression (PCR) and partial least squares (PLS). It turns out that PLS outperform other methods in forecasting the cross-section of Chinese expected futures returns. The equally weighted combination of 5 methods produces an even higher annualized return and lower standard deviation compared to each single method. The investigation of factor importance reveals that the skewness (SKEW) factor is more important than other factors in predicting expected futures returns in Chinese markets.     

The economic return to schooling in Ireland

Recent developments in the schooling returns literature have focused on exploiting alternative instruments. A number of instruments are available in an Irish dataset, including parental background variables (social class and educational attainment), and variables measuring changes in the schooling system (the introduction of free secondary schooling in the mid-1960s, accompanied by a rapid rise in educational participation rates, and the raising of the school-leaving age in 1972). The results suggest, however, that OLS estimates of rates of return are not significantly downward biased as would be suggested by recent arguments in the literature.     

Risk and return: CAPM and CCAPM

Can consumption growth risk (or consumption beta) serve a better measure of risk than market beta? This paper answers this question by testing and comparing the performance of the traditional Capital Asset Pricing Model (CAPM) and consumption-based CAPM (CCAPM) across seven financial market sub-sectors in the emerging Taiwan stock market. The empirical performance of the CAPM is encouraging. The relationship between stock returns and beta is statistically significant and the coefficient of determination of the regression is high across all of seven industry sub-sectors. In comparison, the CCAPM fails to explain the Taiwan stock market although the consumption beta should offer a better measure of systematic risk theoretically.