Project team aging and performance: The roles of project and functional managers

The authors have explored further the effect of the tenure of an R&D group (that is, the length of time in which it has existed) on its performance. Several studies have shown that groups tend to reach a peak of productivity after a few years and decline thereafter. However, it seems that not all teams so decline and the aim of the authors' study reported in this paper was to see what could be learned from those groups that continued to be successful.
They therefore studied a sample of 181 teams comprising 2000 subjects drawn from a wide variety of R&D organizations. Their objectives were first to pick out those teams that remained effective and second, to discover the secret of their success. Group performances were assessed subjectively by senior members of each organization. Group tenures were measured by calculating the average time each individual member had spent in the group. Further information was obtained from questionnaires completed by participants.
Analysis of the results led to the surprising conclusion that there was no evidence whatever for the previously reported curvilinear relationship between performance and tenure. Nevertheless, some long-tenured teams per-formed much better than others and better than newly-formed teams, for which the authors have sought an explanation.
From information deduced from the questionnaires they conclude that the crucial factor is the extent to which the functional manager (department head) as distinct from the project manager nurtures individual researchers, especially in ensuring that they keep abreast of progress in relevant areas of expertise. The role of the project manager on the other hand is to maintain connection between the team and institutional objectives.     

Black-white earnings ratios: the role of cohort size effects

"While black-white earning ratios have been rising over time across cohorts [in the United States] there is some evidence that they have been dropping over time within cohorts of recent entrants to the labor market. This has coincided with the entry of the large baby boom cohorts into the labor market. This paper examines the role of race differences in cohort size effects on black-white earnings ratios for male high school graduates using Current Population Survey data. In larger cohorts, the black-white earnings ratio is lower at entry and falls as the cohort progresses through the career, consistent with recent evidence."     

Efficiency and economies of scale of large Canadian banks

Abstract.  This paper measures the economies of scale of Canada's six largest banks and their cost-efficiency over time. Using a unique panel data set from 1983 to 2003, we estimate pooled cost functions and derive measures of relative efficiency and economies of scale. The disaggregation of the data allows us to include non-traditional outputs as well as time-varying, bank-specific effects. Our model leads us to reject constant returns to scale. These findings suggest there are potential scale benefits in the Canadian banking industry. We also find that technological and regulatory changes have had significant positive effects on the banks' cost structure.     

A Meta-analysis of Hypothetical Bias in Stated Preference Valuation

Individuals are widely believed to overstate their economic valuation of a good by a factor of two or three. This paper reports the results of a meta-analysis of hypothetical bias in 28 stated preference valuation studies that report monetary willingness-to-pay and used the same mechanism for eliciting both hypothetical and actual values. The papers generated 83 observations with a median ratio of hypothetical to actual value of only 1.35, and the distribution has severe positive skewness. We find that a choice-based elicitation mechanism is important in reducing bias. We provide some evidence that the use of student subjects may be a source of bias, but since this variable is highly correlated with group experimental settings, firm conclusions cannot be drawn. There is some weak evidence that bias increases when public goods are being valued, and that some calibration methods may be effective at reducing bias. However, results are quite sensitive to model specification, which will remain a problem until a comprehensive theory of hypothetical bias is developed.JEL classifications: C9, H41, Q26, Q28     

The existence of fully rational expectations approximate equilibria with noisy price observations

Nonrevealing fully rational expectations approximate equilibria exist in microeconomic pure exchange economies in which uninformed agents have suitably dispersed noisy price observations. Such traders maximize a state-dependent expected utility conditional on the price vector they observe, the distributions of noisy price observations, and the correct equilibrium relationship between states of the world and prices. In equilibrium, aggregate excess demand is small with high probability in every state of the world (and its expectation is also small); this magnitude diminishes as the noisy price observations become more accurate. Equilibria are obtained by applying a fixed point argument to state-dependent excess demand functions which are smooth because of the noisy price observations.     

Has Canadian house price growth been excessive?

The dramatic rise in the ratio of Canada's average house price to average rent has led to speculation that there is a bubble in the Canadian housing market. Others have argued, however, that the currently high level of house prices may be rationalized by the low cost of financing, given the decline in interest rates over the last two decades. In this article, we assess these arguments through the lens of a simple asset pricing model applied to city‐level data. We quantify the extent to which excess growth in Canadian house prices depends on the nature of the current regime governing real interest rates, expectations of rent growth in different cities and variations in property taxes.     

‘Tuning Out' or ‘Tuning in'? Mobile Music Listening and Intensified Encounters with the City

Mobile music listening has become an increasingly pervasive part of urban life. Yet it represents an area of enquiry with which urban studies scholars have yet to engage meaningfully. This essay considers the role of mobile music devices in creating new sonic, emotional and social interactions with and within the city. While academic work in this area has emphasized the use of these devices as a ‘tuning out' of the physicality of the city, we suggest that they might also be used as part of a ‘tuning in' that enhances the meaning and intensity of engagements with the city. In making this case, the essay considers two areas of academic enquiry that highlight the use of mobile music devices in intensified engagements with the city: first, recent writing on the sonic ecologies of the city that emphasize ‘city sounds' as part of the urban experience; and secondly, recent advances in the field of urban computing that provide technologies for location‐aware music exchanges and mediated social interactions. The essay emphasizes mobile music listening as one area of critical enquiry that can help develop our understanding of the ways in which the pervasiveness of mobile devices is recalibrating the experience of urban spatiality.     

Large Investors, Price Manipulation, and Limits to Arbitrage: An Anatomy of Market Corners

Corners were prevalent in the nineteenth and early twentieth century. We first develop a rational expectations model of corners and show that they can arise as the result of rational behavior. Then, using a novel hand-collected data set, we investigate price and trading behavior around several well-known stock market and commodity corners which occurred between 1863 and 1980. We find strong evidence that large investors and corporate insiders possess market power that allows them to manipulate prices. Manipulation leading to a market corner tends to increase market volatility and has an adverse price impact on other assets. We also find that the presence of large investors makes it risky for would-be short sellers to trade against the mispricing. Therefore, regulators and exchanges need to be concerned about ensuring that corners do not take place since they are accompanied by severe price distortions.