The Interactive Effects of Labor‐Led Political Mobilization and Vote Propensity on Turnout: Evidence from Five Elections

The concept of unions as political mobilization groups is not well documented relative to the general determinants of voting behavior and labor’s traditional political roles. Specifically, scholars have yet to study the interaction between individuals’ propensities to vote and labor‐led mobilization. Does labor have a stronger influence on frequent, occasional, or non‐voters? Using data totaling 188,551 individuals in Los Angeles over five elections, this paper empirically studies the interaction between vote propensity and mobilization, finding that occasional voters are generally most receptive to labor’s efforts, particularly amongst Latinos, and that personal visits and phone calls are successful for occasional voters.     

Economic Policy - Fact and Ambition

For much of the postwar period, the consensus in British macroeconomics held that output and unemployment were determined by demand which could be managed by the government. Constraints on policy were set by inflation and the balance of payments. Despite the failure of this approach in the 1970s and its rejection in favour of a less ambitious approach since 1979, there are signs that the old consensus is returning. It would be surprising if the 1990s did not produce a shift away from the more hands-off monetarist approach towards greater intervention once again.     

Futures Options and the Volatility of Futures Prices

Assuming nonstochastic interest rates, European futures options are shown to be European options written on a particular asset referred to as a futures bond. Consequently, standard option pricing results may be invoked and standard option pricing techniques may be employed in the case of European futures options. Additional arbitrage restrictions on American futures options are derived. The efficiency of a number of futures option markets is examined. Assuming that at-the-money American futures options are priced accurately by Black's European futures option pricing model, the relationship between market participants' ex ante assessment of futures price volatility and the term to maturity of the underlying futures contract is also investigated empirically.     

Option Pricing Bounds in Discrete Time

Upper and lower bounds are derived for call options traded at discrete intervals. These bounds are independent of assumptions on the stock price distribution other than a restriction satisfied by the stock being “non-negative beta.” The development of the bounds relies on the single-price law and arbitrage arguments. Both single-period and multiperiod results are produced, and put option bounds follow by extension. The bounds exist as equilibrium values given a consensus on stock price distribution; they are also valid for empirical studies, being adjustable for dividends and commissions.     

Managerial Ownership and Accounting Conservatism

In this paper we examine the effect of managerial ownership on financial reporting conservatism. Separation of ownership and control gives rise to agency problems between managers and shareholders. Financial reporting conservatism is one potential mechanism to address these agency problems. We hypothesize that, as managerial ownership declines, the severity of agency problem increases, increasing the demand for conservatism. Consistent with our hypothesis, we find that conservatism as measured by the asymmetric timeliness of earnings declines with managerial ownership. The negative association between managerial ownership and asymmetric timeliness of earnings is robust to various controls, in particular, for the investment opportunity set. We thus provide evidence of a demand for conservatism from the firm's shareholders.     

RESIDENTIAL PHOTOVOLTAIC ENERGY SYSTEMS IN CALIFORNIA: THE EFFECT ON HOME SALES PRICES

Relatively little research exists estimating the marginal impacts of photovoltaic (PV) energy systems on home sale prices. Using a large data set of California homes that sold from 2000 through mid‐2009, we find strong evidence, despite a variety of robustness checks, that existing homes with PV systems sold for a premium over comparable homes without PV systems, implying a near full return on investment. Premiums for new homes are found to be considerably lower than those for existing homes, implying, potentially, a trade‐off between price and sales velocity. The results have significant implications for homeowners, builders, appraisers, lenders, and policymakers. (JEL R31, D12, C33)     

Who Finances Durable Goods and Why It Matters: Captive Finance and the Coase Conjecture

We propose that, by financing their own product sales through captive finance subsidiaries, durable goods manufacturers commit to higher resale values for their products in future periods. Using data on captive financing by the manufacturers of heavy equipment, we find that captive‐backed models have lower price depreciation. The evidence is consistent with captive finance helping manufacturers commit to ex‐post actions that support used machine prices. This, in turn, conveys higher pledgeability for captive‐backed products, even for individual machines financed by banks. Although motivated as a rent‐seeking device, captive financing generates positive spillovers by relaxing credit constraints.     

An English Assessment of Scotland's Education Spending Needs

Scotland has much higher public expenditure per head than England, but little work has been done to compare Scottish and English needs. We compare their needs for school education, and we show that if the Formula Spending Share approach that is used to estimate English local authorities' needs were applied in Scotland, then Scotland would be found to need about 3 per cent more per pupil than England; however, this English approach may slightly underestimate Scotland's needs. We also show that the Grant Aided Expenditure approach that is actually used to estimate Scottish local authorities' needs may be about 7 per cent more generous than the English approach. Finally, we find that the correlation between the relative education needs for different authorities as assessed by the Scottish approach and their relative needs as assessed by the English approach is only modest; this implies that there may be serious shortcomings in at least one approach.