Do Individual Investors Have Asymmetric Information Based on Work Experience?

Using a novel data set covering all individual investors' stock market transactions in Norway over 10 years, we analyze whether individual investors have a preference for professionally close stocks, and whether they make excess returns on such investments. After excluding own‐company stock holdings, investors hold 11% of their portfolio in stocks within their two‐digit industry of employment. Given the poor hedging properties of such investments, one would expect abnormally high returns. In contrast, all estimates of abnormal returns are negative, in many cases statistically significant. Overconfidence seems the most likely explanation for the excessive trading in professionally close stocks.     

Price Dispersion and the Role of Stores*

In this paper, we study price dispersion in the Norwegian retail market for 766 products across 4,297 stores over 60 months. Price dispersion for homogeneous products is significant and persistent, with a coefficient of variation of 37 percent for the median product. Price dispersion differs between product categories and over time. Store heterogeneity accounts for 30 percent of the observed variation in prices for the median product–month, and for around 50 percent for the sample as a whole. Price dispersion is still prevalent after correcting for store heterogeneity.     

Vertical Control and Price Cycles in Gasoline Retailing

We examine Norwegian gasoline pump prices using daily station‐specific observations from 2003 to 2006. The four big gasoline companies use a vertical restraint that is adopted industry‐wide (labeled price support). This moves price control from the hands of independent retailers into the hands of the headquarters. Retail gasoline prices follow a fixed weekly pattern, where we observe de facto simultaneous decision‐making by the headquarters (without knowledge of their rivals’ prices) when every Monday around noon they decide to increase pump prices to the same level. The price level on Mondays corresponds to the recommended prices published by the headquarters of the gasoline companies.     

Quantifying rural livelihood strategies in developing countries using an activity choice approach

This article uses a quantitative activity choice approach, based on identification of activity variables and application of latent class cluster analysis, to identify five major rural livelihood strategies pursued by households (n= 576) in Bolivia, Nepal, and Mozambique. Income sources and welfare outcomes are compared across strategies and household differences in asset holdings are analyzed using multinomial logit regression. Findings reveal that income diversification is the norm, that a higher degree of specialization does not characterize more remunerative livelihood strategies, that nonfarm income significantly contributes to higher income earnings, that environmental reliance does not vary across strategies, and that small‐scale farmers are the largest and poorest livelihood group. Some livelihood strategies are superior to all other strategies in terms of income earned; access to more remunerative livelihood strategies is determined by land ownership, education, and ethnic affiliation. Finally, the article also highlights that additional work is required to determine the most suitable methods for livelihood strategy identification.     

The carnival goes on and on! Children’s perceptions of their leisure time and play in SFO 1

This paper deals with one part of a research project which aimed to identify a solid sociological base for a variety of adult education activities, through a combination of analytical and ethnographic approaches. The main focus here is on adult education as a leisure form. I propose that in considering adult education as a leisure form, account has to be taken of the relationship between leisure, paid work, the domestic work of women, and consumption in capitalist society. It is concluded that access and equal opportunities are crucial issues in considering adult education as a leisure form, but that equally important are the considerations of adult education as a preparation for leisure and leisure itself as an activity from which adults learn.     

THE IMPORTANCE OF SKILL MEASUREMENT FOR GROWTH ACCOUNTING

In a growth accounting context one usually constructs a quality adjusted index of labor services by aggregating over predefined groups of workers, using the groups' relative wage bills as weights. In this article we suggest a method based on decomposing individual predicted wages into a skill‐related part and a part unrelated to skill, where the former consists of both observed and unobserved components. The predicted wages, associated with individual skill attributes, are sorted and classified into deciles. The median predicted skill‐related wage in each decile is used to construct an alternative skill‐adjusted index of labor services. We find that total factor productivity (TFP) growth decreases significantly when using the latter method. This means that when using the alternative method one explains more of the growth in labor productivity than what a more traditional labor quality adjustment procedure does.     

A fractionally cointegrated VAR analysis of economic voting and political support

We use a fractionally cointegrated vector autoregressive model to examine the relationship between Canadian political support and macroeconomic conditions. This model is well suited for the analysis because it allows multiple fractional time series and admits simple asymptotic inference for the model parameters and tests of the hypotheses of interest. In the long‐run equilibrium, we find that support for the Progressive Conservative Party was higher during periods of high interest rates and low unemployment, while support for the Liberal Party was higher during periods of low interest rates and high unemployment. We also test and reject the notion that party support is driven only by relative (to the United States) economic performance. Indeed, our findings suggest that US macroeconomic variables do not enter the long‐run equilibrium of Canadian economic voting (political opinion poll support) at all.     

Blurred Promises: Ethical Consequences of Fine Print Policies in Insurance

The insurance industry’s practice of producing comprehensive insurance policies can have unforeseen and negative ethical consequences. Insurance policies express promises from the insurer to the insured, to the effect that the insurer should be trusted to appropriately assist the insured in case of accident. The relation is seriously undermined when the content of the promise is blurred, containing clauses and condition which are ambiguous or hidden in fine print. This paper contains an investigation of (1) the sources of the fine print policy practice, (2) its immediate effects on the degree to which the policies are understandable to the insured, (3) the ethical consequences that can follow from blurring the true content of the insurer’s promise to the insured and (4) the measures insurers can take in order to develop a more constructive ethical relationship with its customers.