The Effect of Taxes on the Relative Valuation of Dividends and Capital Gains: Evidence from Dual-Class British Investment Trusts

We provide evidence that taxes affect equity valuation by studying British investment trusts having otherwise identical classes of cash- and stock-dividend-paying shares outstanding. We study 1969–1982, a period in which there were two dramatic changes in tax policy. We find that stock-dividend shares, which are convertible into cash-dividend shares, sell at premiums when the tax system favors capital gains and at discounts when the tax advantage of capital gains is reduced. After the 1975 elimination of the tax advantage to stock-dividend shares, we observe that investors convert virtually all stock-dividend shares into cash-dividend shares.     

Marketmaker Behavior in an Auction Market: An Analysis of Scalpers in Futures Markets

This paper focuses on the role of scalpers as marketmakers in the competitive auction of futures exchanges. We use transactions data of a representative scalper to identify the source of scalper earnings. We find that scalpers provide liquidity services to incoming market orders, thereby facilitating commercial hedging. Scalper earnings are positively related to the bid-asked spread and negatively related to the length of time a position is held.     

Correlates of Union Support in NLRB Elections

Bargaining unit, union, industry, and geographic correlates of union support in NLRB certification and decertification elections for the period 1977 to 1979 are analyzed using similar regression specifications. Several relationships are found to be significant; however, an examination of the magnitude of the estimated coefficients suggests only unit size and union organizing effort affect outcomes in more than a small percentage of all certification elections.     

The Estimation of Quality-adjusted Rates of Return in Stamp Auctions

The stamp auction market exemplifies markets in which a dominant feature is the quality variation in the traded assets. The observed price changes are a mixture of the “true” price change and the quality variation. This paper applies the time series signal extraction method to obtain estimates of quality-adjusted rates of return and quality-adjusted price indexes for stamp auction price series. The method is applicable to other areas in which there is quality variation or in which values are observed with error. Some features of stamps as an investment are also examined.     

Monetary–Fiscal Policy Interactions under Implementable Monetary Policy Rules

This paper examines the implications of forward- and backward-looking monetary policy rules in an environment with monetary–fiscal interactions. We find that the unique stationary rational expectations equilibrium (REE) is always non-Ricardian under simple implementable monetary policy rules.     

Should We Wait to 'Grow Out of' Unemployment? The Implications of a Neoclassical Calibration Analysis

The paper uses a Solow-Ramsey growth model to evaluate the effectiveness of growth as a remedy for unemployment in the face of a wage minimum. Plausible calibration of the model suggests that the elimination of 5 per cent unemployment by the process of capital accumulation may take about 20 years.