A MODIFIED METHOD FOR INFERRING THE EFFECTIVE BID-ASK SPREAD FROM SECURITY RETURNS

This paper presents a modified method for inferring the effective bid-ask spread from security returns in an eMicient market. The Modified Method removes from security returns the systematic effect of market movements and makes use of the equivalence properties of the moving average process and serial covariance function. The Modified Method is tested with the CRSP daily, weekly, and monthly returns data. The results show that the spread estimates are non-negative and sample time-interval independent. The results are compared with those of Roll (1984) and Amihud and Mendelson (1986).     

The Chinese RMB: Its Value,Its Peg,and Its Future

The valuation of the Chinese renminbi (RMB) has drawn lots of attention lately and a great deal of pressure on the part of developed nations for revaluation. In addressing the issue of valuation, this paper develops a new purchasing power parity (PPP) index of China’s exchange rate and finds that the while undervalued, the undervaluation is neither unusual nor bad policy. Moreover, China’s overall external trade balance does not seem to be that far out of equilibrium. China’s desire to join the G-7 club is likely to result in abandoning its peg, however, despite the increased risk to its economic development.JEL Classification F310     

Knowledge sharing in an organization

Managers are always seeking effective policies that encourage employees to share their knowledge with others in an organization. The appropriate organizational incentives are difficult to investigate due to human factors and other institutional complexities affecting sharing behaviors of individuals. Conducting laboratory or field experiments to evaluate the effectiveness of various organizational incentive policies is unrealistic. This work proposes a novel agent-based modeling approach to simulate the actions of knowledge sharing between actors in an organization. Several human and institutional factors in this artificial world were manipulated to understand knowledge sharing. The simulation results produce the following interesting findings. (1) The initial state of actors' action affects the knowledge-sharing action regardless of the adopted strategy. (2) Poorer collective capability among the population lowers the knowledge sharing behaviors. (3) The incentive policy has restricted effects for increasing the sharing action. Rewarding each knowledge-sharing action is more effective than the periodic organizational incentives to encourage actors' knowledge sharing behaviors.     

Estimating the costs of non-fatal consumer product injuries in the United States

This paper describes a data-driven injury cost model (ICM) developed to estimate the costs associated with non-fatal consumer product injuries. The modeling effort combines information by diagnosis from the US Consumer Product Safety Commission’s National Electronic Injury Surveillance System (NEISS) and 17 other large data sets. The ICM contains four aggregated cost components: (1) medical costs, (2) work losses, (3) quality of life and pain and suffering costs, and (4) product liability insurance administration and litigation costs. The ICM estimates societal costs, which are broader than costs to any individual group, such as victims, insurers, or product manufacturers. Costs associated with consumer product injuries are estimated to be approximately $500 billion in 1996, accounting for nearly one-third of the total annual injury costs. We examine injury costs in several ways, including by major product category, by sex and age of victims, by body part injured, by injury diagnosis, and by highest level of medical treatment received. We also rank the 10 leading consumer products that account for injury costs overall and within different age groups. Products such as stairs and floors are among the top 10 for all age groups. Other products, however, are more closely tied to injuries at particular stages of life (e.g., infant/toddler, child, young adult, elderly). These cost estimates are useful in assessing which products and types of injuries impose the greatest costs on society and for identifying areas for focused injury prevention efforts.     

The Imperative of Education

Teaching midgrade leaders at the Command and General Staff Officers Course (CGSOC) located in Ft. Leavenworth, Kansas, comes with many unique challenges. At CGSOC, students arrive having led soldiers in combat and having served in leadership positions in the United States Army for at least 10 years. When they walk into the classroom and see an instructor with a dress shirt and tie—not in a uniform—their immediate thought is, “What can this civilian teach me? I have fought in foreign lands and had to watch people die and lead soldiers through intensely difficult circumstances.” Through most of their careers, their approach to learning in Professional Military Education (PME) has been through training. CGSOC is the first time they experience learning from mostly an educational pedagogy as opposed to training. We focus on teaching how to think instead of what to think. At CGSOC we use an Experiential Learning Model (ELM), based on Kolb's Experiential Learning Theory. The ELM takes Kolb's experiential learning cycle and superimposes five steps on the preferred learning styles described by Kolb. We promote student‐to‐student dialogue, drawing out the experience resident in the classroom, and add leadership theory to reinforce the learning.     

Neighbourhood effects,preference heterogeneity and immigrant educational attainment

This paper investigates differences between the educational attainment of immigrants, children of immigrants and native-born individuals in Australia by using Australian Youth Survey (AYS) data combined with aggregate Australian Census data. Differences in educational attainment are decomposed into: (i) typical demographic and socio-economic sources common to all ethnic groups; (ii) unobserved region of residence and region of origin effects; and (iii) neighbourhood effects such as degree and ethnic concentration of particular ethnic groups in different neighbourhoods. A theoretical model incorporating these effects is proposed but structural estimation is not possible for lack of appropriate data. Instead, a reduced form methodology is proposed and employed. The empirical results identify positive ethnic neighbourhood effects in high school completion and university enrolment for some immigrant groups in Australia, in particular first and second generation immigrants from Asia. The results indicate that it is not just the size of the ethnic network but the ‘quality’ of the network that is important.     

International cattle ID and traceability: Competitive implications for the US

Global standards for animal identification and traceability are evolving rapidly. Major world animal health, trade, and food safety organizations have formally recognized the importance of, and actively promoted, animal identification and traceability system development. Advanced animal traceability systems have been deployed by major beef exporters and are increasingly being adopted by important beef importing countries. This study summarizes and compares animal identification systems across major export and import countries. Results reveal that the United States lags behind both major export and import countries in development and adoption of cattle identification and tracing systems. As such, the United States has placed itself in a vulnerable position relative to competing export countries with respect to demonstrated animal traceability. This status could adversely affect market access in the future for US beef exports.