The effectiveness of the Nord-Pas-de-Calais coal cartel during the inter-war period: a research note

This note analyzes the collusive strategies developed by coal companies in the Nord-Pas-de-Calais (NPC) coal basin of France during the inter-war period. Based on an examination of archival data, mechanisms for maintaining collusive agreements are detailed.     

Stock Returns and Operating Performance of Securities Issuers

We examine long‐run stock returns and operating performance around firms’ offerings of common stock, convertible debt, and straight debt from 1985 to 1990. We find that pre‐issue abnormal returns are positive and significant for stock issuers, but not for convertible and straight debt issuers. The post‐issue mean returns show that common stock and convertible debt issuers experience underperformance during the post‐issue periods, but straight debt issuers do not. Consistent with these results, common stock issuers experience the best pre‐issue operating performance among all three types of issuers, and operating performance declines during the post‐issue periods for common stock and convertible debt issuers. Using a new approach in linear model estimations to correct heteroskedasticity and to adjust for finite sample, we find a positive relation between post‐issue operating performance and issue‐period stock price reactions. The results suggest that future operating performance is anticipated at the issue and that securities issues provide information on issuers’ future performance.     

Least squares fitting of an affine function and strength of association for interval-valued data

The ultimate goal of this paper is to determine a measure of the degree of dependence between two interval-valued random sets, when the dependence is intended in the sense of an affine function relating these random elements. For this purpose, a general study on the least squares fitting of an affine function for interval-valued data is first carried out, where the least squares method we will present considers that squared residuals are based on a generalized metric on the space of nonempty compact intervals, and output and input random mechanisms are modelled by means of convex compact random sets. For the general case of nondegenerate convex compact random sets, solutions are presented in an algorithmic way, and the few cases leading to nonunique solutions are characterized. On the basis of this regression study we later introduce and analyze a well-defined determination coefficient of two interval-valued random sets, which will allow us to quantify the strength of association between them, and an algorithm for the computation of the coefficient has been also designed. Finally, a real-life example illustrates the study developed in the paper.  The research in this paper has been partially supported by DGESIC Grants DGE-99-PB98-1534 and DGE-98-PB97-1282 of the Spanish MEC. Their financial support is gratefully acknowledged. Acknowledgements. The authors are deeply grateful to Professor Wolfgang N?ther from the University of Freiberg and their colleagues Professors Norberto Corral, Miguel López-Dı′az and Ignacio MartVnez for their valuable comments and suggestions in connection with this paper. The real-life data which illustrate the study in this paper have been supplied by Aurora Fonseca, Head of the Servicio de Nefrologı′a, and Miguel de Zárraga, General Medical Manager, from the Hospital Valle del Nalón de Langreo in Asturias; we want to thank them sincerely for their collaboration and support.     

Is financial reporting shaped by equity markets or by debt markets? An international study of timeliness and conservatism

We hypothesize debt markets—not equity markets—are the primary influence on “association” metrics studied since Ball and Brown (1968 J Account Res 6:159–178). Debt markets demand high scores on timeliness, conservatism and Lev’s (1989 J Account Res 27(supplement):153–192) R ², because debt covenants utilize reported numbers. Equity markets do not rate financial reporting consistently with these metrics, because (among other things) they control for the total information incorporated in prices. Single-country studies shed little light on debt versus equity influences, in part because within-country firms operate under a homogeneous reporting regime. International data are consistent with our hypothesis. This is a fundamental issue in accounting.     

Why don’t you trade only four days a year? An empirical study into the abnormal returns of quarters first trading day

In this research I examined a calendar anomaly that occurs at the beginning of each quarter. Through an examination of 34 years of daily and annual returns for the S&P500 and 13 years of returns for popular ETFs, I have demonstrated the existence of the First Day of Quarter (FDQ) effect. By trading only four days a year from the beginning of 2000 until the end of 2013, an investor could have gained 113.1% of the S&P500 returns for that period, while being exposed to stock risk for only 56 days. Moreover, for 11 of those 14 years of trading, the FDQ was responsible for more than 10% of the annual returns. Only for two years since 2000 (2001, 2005) has the FDQ yielded a negative return. The biggest beneficiary of the FDQ is the financial sector, which for the last 13 years of investing has been non-fertile, showing −6.12% total return. Investing only at the beginning of each quarter for a total of 52 days would have yielded a return of 40.17%. The next beneficiary of the FDQ is the technological sector. The 82.5% of total return gained in this sector over the last 13 years could have been gained in only 52 days of trading.     

State contract law and the use of accounting information in debt contracts

Review of Accounting Studies - This paper examines the relation between state contract law and the use of accounting information in debt contracts. Contract theory suggests that balance sheet based...     

The efficacy and efforts of interest groups in post elections policy formation

This paper presents a new model of interest groups and policy formation in the legislature. In our setting, the already given party ideological predispositions and power distribution determine the expected policy outcome. Our analysis applies to the case of un-enforced or enforced party discipline as well as to two-party and multi-party (proportional representation) electoral systems. The interest groups’ objective is to influence the outcome in their favor by engaging in a contest that determines the final decision in the legislature. Our first result clarifies how the success of an interest group hinges on the dominance of its ideologically closer party and, in general, the coalition/opposition blocks of parties under un-enforced party or coalition/opposition discipline. Such dominance is defined in terms of ideological inclination weighted by power. Our second result clarifies how the success of an interest group hinges on the dominance of its ideology in the ruling coalition (party) in a majoritarian system with enforced coalition (party) discipline. We then clarify under what condition an interest group prefers to direct its lobbying efforts to two parties or the two coalition and opposition blocks of parties under un-enforced discipline rather than to the members of the ruling coalition (party) under enforced discipline. The lobbying efforts under un-enforced and enforced party discipline are also compared. Finally, we clarify the effect of ideological predispositions and power on the efforts of the interest groups.     

Does expert trust and factual knowledge shape individual's perception of science?

Explaining how individuals form their risks and benefit perceptions with regard to new technologies is a key issue in order to understand how new information disseminates. This paper examines the effect of knowledge, social values and trust in experts as shaping perceptions of risks and benefits of new technologies. Given that individual's perceptions of a technology is affected by unobserved heterogeneity, we use a methodology to disentangle the effect of a joint estimation of risks and benefit perceptions, namely seemingly unrelated probit, and we draw upon evidence from a representative survey carried out in Spain. Our findings suggest that factual knowledge and trust in experts increase perceptions of benefit of new technology developments and jointly reduce the perceptions of risk. Furthermore, reliance on traditional social values only appears to affect perceptions of benefits but does not influence risk perceptions.     

Demarketing energy: Does psychographic research hold the answer?

A pilot research study suggests that a psychographic analysis can provide rich insights into consumer energy profiles. Marketing research and analysis can contribute substantially in dealing with this national crisis.     

Cooperative R&D with Endogenous Technology Differentiation

We study a nontournament R&D duopoly. Before the standard R&D investment and quantity-setting stages, we consider a stage in which firms choose their R&D technologies. Spillovers negatively depend on R&D technology differentiation. We show that, in equilibrium, firms will choose identical or very similar R&D processes. Such equilibria may entail less differentiation than would be dictated by social welfare maximization.