Distressed comps

We consider the use and impact of distressed properties as comparables in residential appraisals. First, we describe the incidence of their use and their relative comparability; second, we estimate their impact on the appraisal value itself; and third, we consider their impact on the probability that the appraisal is below the proposed transaction price. We find, generally, that distressed comps are largely good matches to their subject properties, which suggests that they are not necessarily used as a last resort. We find that they are not a drag on appraised value because appraisers learn to make the right adjustments over time. The use of distressed comps is associated with a higher probability of a below-price appraisal due to the increased spread of appraisals around the contract price, particularly for higher priced homes. Overall, the use of distressed comps increased the uncertainty in the valuation process, but appraisers learned the appropriate adjustments over time.     

Toward an Evolutionary Theory of Trade Associations: The Case of Real Estate Appraisers

This paper proposes a developmental theory of trade association life cycles with special emphasis on the case of real estate appraisers. Given a neo-institutional perspective of the demand for appraisal services, the paper views real estate appraisers as information specialists. Trade associations tend to develop along a common, although not strictly fixed, set of steps. At each stage, various institutional activities occur that when observed, can be used to characterize the association's rate of development. In this context, real estate appraisers and their institutions are examined. Recent advances provide evidence that major changes are currently underway.     

The Gatekeeper Appraiser's Role in an Era of Higher Energy Prices*

This article discusses the notion of gatekeeper, or opinion leader, appraisers. Because these appraisers are instrumental in disseminating information to other appraisers they are very influential in shaping appraisal practices. A sample of 763 appraisers is used to identify these gatekeepers and to examine their appraisal practices relative to other appraisers. Differences are noted between opinion leaders and non-opinion leaders in the importance attached to and in the use of energy conservation components of real property in appraisals.     

Assessing the Market Value of Real Estate Property with a Geographically Weighted Stochastic Frontier Model

In this study we consider the problem of sellers, buyers and real estate appraisers in determining the price for a house, taking into account the characteristics of the house and its location as well as the goals of these three different parties. The appraiser's job is to determine the fair market value of the house, while the buyer and seller want to find, respectively, the lowest and highest feasible price for it. We combine recent developments in geography and econometrics to develop an approach that determines local estimates of property values from the perspectives of the buyer, seller and appraiser, taking into account the characteristics of the house as well as its location. We illustrate our approach analyzing closing prices in one residential real estate market.     

Unsmoothing Real Estate Returns: A Regime‐Switching Approach

We propose newly developed unsmoothing techniques for appraisal‐based real estate returns based on a regime‐switching threshold autoregressive (TAR) model. We show that when true returns follow a TAR process, conventional linear autoregressive techniques are misspecified and underestimate true variance. Two exogenous variables, equity returns and gross domestic product growth, outperform other variables as regime indicators and appear to capture risks of downturns in real estate. We extend the model to the smoothing equation, allowing for switching behavior by appraisers, using two new techniques: the TAR‐AR and TAR‐TAR approaches. The “co‐switching” specification opens up a new frontier of empirical research. We estimate the TAR‐TAR using FT returns as the regime indicator, and we find results that outperform conventional smoothing models and have plausible economic explanations.     

Gender Sorting at the Application Interface

We document gender sorting of candidates into gender‐typed jobs at the point of initial application to a company. At this step of the hiring process, the firm has implemented a policy whereby organizational screeners’ discretion has been eliminated such that there is no opportunity for contact between hiring agents and applicants. Thus, the job choices studied here offer unique insight as they are uncontaminated by screeners’ steering of candidates toward gender‐typed jobs. Even in the absence of steering, we find clear patterns of gendered job choices that line up with gender stereotypes of job roles. Moreover, these gendered patterns recur both within individuals and within race groups. Comparing our findings to the pattern of job sorting in the external local labor market, we find that supply‐side factors do not fully account for the levels job sex segregation observed in the open labor market. Although probably not the entire story, we show clear evidence that supply‐side sorting processes are important factors contributing to job sex segregation.     

‘It's like,instant respect’: Coworking spaces as identity anchoring environments in the new economy

As employment relationships become more tenuous, as work grows increasingly virtual and as professional reputations circulate across online platforms, coworking provides individuals across various work arrangements with shared workspaces oriented towards sociability, visibility and convenience. Our study explores how coworking spaces also enable individuals to shape their professional identities while providing other important attributes of work to help it feel embodied and grounded. Drawing from interviews and surveys of members of a large coworking chain across the United States, we find that coworking spaces serve as identity anchoring environments. We find that many workers use material elements of the space to ground their professional identities in three ways: evidencing professional credibility, enacting a common ethos and energising connections with others. More broadly, we also find that coworking operators package and sell the physical, spatial and symbolic aspects of work to help certain workers signal their professional selves.     

National Vacancy Rates and the Persistence of Shocks in U.S. Office Markets

In this paper, we develop and estimate a model that decomposes the variance in office vacancy rates into market-specific, time-specific, and random components. The results indicate significant differences in natural vacancy rates across markets. We also find some persistence in deviations from these natural vacancy rates. The analysis is applied to both central business district (CBD) and suburban office markets. We find that natural vacancy rates differ across CBD markets and across suburban markets. Further, the persistence of disequilibrium in one CBD market seems to differ significantly from that in another. This is not shown to be true for suburban markets.     

Pricing behavior in United States manufacturing industries: A statistical study using disaggregated data

We investigate the relationship between industrial market structure and price flexibility (the administered-pricing hypothesis) across United States manufacturing industries by embedding market-structure variables in a model relating relative price variability (dispersion) and inflation. While we find support for a positive relationship between variability and inflation, we do not find that high seller concentration lessens the impact of inflation on price variability. We do find that the larger the efficient-sized plant, the lower the impact of inflation on variability. We also find strong effects of input prices and degree of product durability on relative price variability.     

A retrospective study on the regional benefits and spillover effects of high-speed broadband networks: Evidence from German counties

This study aims to assess the economic benefits of high-speed broadband within and across neighboring counties in Germany. Utilizing a balanced panel dataset of 401 German counties with data from 2010 to 2015 as well as different panel estimation techniques, we find that an increase in average broadband speed has a significantly positive effect on regional GDP in the average German county. Furthermore, we find that broadband deployment in German counties induces not only substantial economic benefits in terms of direct effects within counties but also positive regional externalities across counties. According to our estimation results, an increase in average bandwidth speed by one unit (1 Mbit/s) induces a rise in regional GDP of 0.18%. This effect is almost doubled if we also take regional externalities into account (0.31%). Moreover, we find that regional agglomeraton effects are of particular relevance for rural counties. Our cost-benefit analysis of subsidies based on conservative estimates suggests efficiency gains, as the total economic per capita benefits (€164) of subsidy programs to encourage broadband expansion exceeded their associated per capita costs (€114).     

Do House Price Levels Anticipate Subsequent Price Changes within Metropolitan Areas?

This research examines the relationship between hedonically controlled housing price levels and subsequent changes in those prices across locations within MSAs. Are areas with a high price relative to an “imputed rent” paying for higher appreciation? In an efficient market (e.g., Gordon Growth Model), as fundamentals (impute rent) differ across locations and change over time, anticipation of these should generate a positive correlation between (residual) price levels and subsequent price changes. We undertake these tests in four different MSAs using a panel of repeat‐sale house price indices that have been scaled to price levels with the hedonic attributes of the house and ZIP code. In three markets we find that identical houses in higher priced ZIP codes subsequently appreciate faster. In one market we find that there is little statistical difference.     

Performance Pay and Applicant Screening

Using German establishment data, we show that the relationship between intensity of individual‐based performance pay and intensity of applicant screening depends on the nature of production. In establishments with increased multitasking, performance pay is positively associated with applicant screening. By contrast, in establishments without increased multitasking, performance pay is negatively associated with applicant screening. We do not find a similar pattern of results for group‐based performance pay or profit‐sharing. Our findings fit the hypothesis that individual‐based performance pay induces a positive self‐sorting of employees if jobs are less multifaceted. In this case, employers with a high intensity of performance pay do not need intensive applicant screening to ensure a high quality of matches between workers and jobs. However, if jobs are more multifaceted, individual‐based performance pay can entail problems of adverse self‐sorting. In order to mitigate or overcome these problems, employers making intensive use of performance pay also screen applicants more intensively.     

Loss Aversion and Anchoring in Commercial Real Estate Pricing: Empirical Evidence and Price Index Implications

Loss aversion behavior plays a major role in the pricing of commercial properties, and it varies both across the type of market participants and across the cycle. We find that sophisticated and more experienced investors are at least as loss averse as their counterparts and that loss aversion operated most strongly during the cycle peak in 2007. We also document a possible anchoring effect of the asking price in influencing buyer valuation and subsequent transaction price. We demonstrate the importance of behavioral phenomena in constructing hedonic price indices, and we find that the impact of loss aversion is attenuated at the aggregate market level. This suggests that the pricing and volume cycle during 2001–2009 was little affected by loss aversion.     

Does interdependency affect firm and industry profitability? an empirical test

Strategy researchers have argued that heterogeneity in firms' practices and profitability within and across industries may derive from industry‐level differences in the extent of interdependencies among firms' activities. Theoretical models have clarified how and why differences in the extent of the interdependencies faced by firms across industries may affect the distributions of firm profits, but the specific predictions from these models have not been empirically tested. In this paper, we present what we believe is the first large scale empirical analysis linking differences in the extent of interdependencies across industries to differences in the distribution of firm profits within and across those industries. We use survey data to measure interdependencies systematically across a wide number of industries, thus addressing the primary obstacle to incorporating interdependencies in larger scale empirical work, and find evidence consistent with the theoretical predictions: average profitability is highest in industries with moderate levels of interdependency; the dispersion of profits among firms is higher in industries with more extensive interdependencies; and industries with more extensive interdependencies have a more positively skewed performance distribution. We find that the effect of interdependencies on average industry profitability is similar in scale to the effect of patent protection and industry growth rates, placing interdependency squarely among the strategy field's central concepts. Copyright © 2009 John Wiley & Sons, Ltd.     

Discrimination Against Prounion Job Applicants

This study analyzes 95 unfair labor practices involving pre-employment discrimination against union adherents. The cases were heard either by the National Labor Relations Board or U.S. Court of Appeals between 1976 and 1986. Nonsupervisory, unskilled applicants who suffer preemployment discrimination by employers that display antiunion sentiments during union organizing campaigns have a lower probability of winning their cases than to skilled applicants. Pre-employment screening of job applications with prounion backgrounds or attitudes is often part of a larger pattern of unfair labor practices by management. The Dotson administration also supported management's rejection of prounion applicants at a significantly higher rate than did other NLRB administrations.     

Do mass layoffs affect voting behaviour? Evidence from the UK

How bad are mass layoffs politically? We study this question across both regional and individual-level datasets. Using a difference-in-difference framework with differential timing on constituency-level data for the UK, we find no evidence that mass layoff announcements negatively affect incumbents – either locally or nationally – in the General Elections 2010, 2015, 2017 and 2019. Using individual data on party preferences, we demonstrate that our results are not an artefact of the UK majority voting system and associated tactical voting. We also find no evidence that the null results can be explained by increased outmigration of affected individuals or changes of candidates by political parties. We find evidence that economic expectations are not strongly affected by mass layoffs, which, although a surprising finding by itself, might help to explain the absence of an effect on political outcomes.     

The Impact of Market Experience Upon Appraisers' Energy Awareness*

This article explores the notion that appraisers respond to a very rapid change in any factor that will ultimately affect real estate values only after they witness the effects of this change in actual marketplace transactions. An analysis of 685 responses to a recent national appraiser survey suggests that a cause and effect relationship exists between their energy related market experiences and their energy awareness level. Market imperfections and the difficulty of predicting future energy prices are identified as barriers that inhibit the appraisers' ability to achieve a high level of energy awareness.     

Impact of commuting by workers on household dietary diversity in rural India

Drawing insights from the literature on transformation of rural non-farm employment, pathways from agriculture to nutrition, and linkages between migration and nutritional status of household, we seek to understand differences in dietary diversity across three mutually exclusive types of rural Indian households: where all members work in rural areas, at least one member commutes to urban areas, at least one member has no fixed place of work. Our analysis is based on a nationally representative data set from India for the year 2009–10 and we use propensity score matching methods. We find that as compared to households with no commuters, households with rural–urban commuters have higher dietary diversity; whereas households with no fixed place workers have lower dietary diversity. We also find differences in dietary diversity across households which differ by their primary source of income.     

Patent Quality and a Two‐Tiered Patent System

In this paper, we study the determinants of patent quality and volume of patent applications when inventors care about perceived patent quality. We analyze the effects of various policy reforms, specifically, a proposal to establish a two‐tiered patent system. In the two‐tiered system, applicants can choose between a regular patent and a more costly, possibly more thoroughly examined, ‘gold‐plate’ patent. Introducing a second patent‐tier can reduce patent applications, reduce the incidence of bad patents, and sometimes increase social welfare. The gold‐plate tier attracts inventors with high ex‐ante probability of validity, but not necessarily applicants with innovations of high economic value.