Output‐Based Performance Pay,Performance‐Support Bias,and the Racial Pay Gap within a Large Retail Stock Brokerage

We measure sources of racial inequality in stockbroker pay. Pay differences arise from sales differences. We measure the extent to which sales differences are due to performance‐support bias, whereby African American brokers receive weaker firm supports, or to forces outside the firm, including client access, selection, and consumer discrimination. Data on firm policies are matched to sales results. Data on self‐generation of accounts measure access to wealthy clients. Sales generated from accounts with sales histories show racial differences in sales arising from selection or consumer discrimination.     

Zinshöhe,Sparen und Kapitalbildung

Ohne Zusammenfassung     

Interbank market integration, loan rates, and firm leverage

This paper investigates the effect of interbank market integration on small firm finance in the build-up to the 2007-2008 financial crisis. We use a comprehensive data set that contains contract terms on individual loans to 6047 firms across 14 European countries between 1998:01 and 2005:12. We account for the selection that arises in the loan request and approval process. Our findings imply that integration of interbank markets resulted in less stringent borrowing constraints and in substantially lower loan rates. The decrease was strongest in markets with competitive banking sectors. We also find that in the most rapidly integrating markets, firms became substantially overleveraged during the build-up to the crisis.     

Equivalence of Input Quotas and Input Charges under Asymmetric Information in Agri‐environmental Schemes

A model of adverse selection and moral hazard in agri‐environmental schemes is developed based on the input quota mechanism of Moxey et al. (Journal of Agricultural Economics, Vol. 50, (1999) pp. 187–202) and Ozanne et al. (European Review of Agricultural Economics, Vol. 28, (2001) pp. 329–347), rather than the input charge mechanism of White (Journal of Agricultural Economics, Vol. 53, (2002) pp. 353–360), but the variable fine of the latter rather than the fixed fine assumed by Ozanne et al. (European Journal of Agricultural Economics, Vol. 28, (2001) pp. 329–347) is used. Incentive‐compatible contracts, including the optimal probabilities of detection (and, therefore, monitoring frequencies and costs) for more and less efficient farmers, are identified. It is shown that the input charge and input quota approaches lead to identical outcomes – in terms of abatement levels, compensation payments, monitoring costs and probabilities of detection – confirming the equivalence of input quotas and input charges under asymmetric information. It is also shown that the optimal contracts are independent of the risk preferences of farmers with regard to being caught cheating.     

Actuarial Science Summer Program for Women and Minorities

Drake University offered a 5‐day program focusing on the recruitment of women and minorities into actuarial science studies. A few universities offer actuarial science summer camps targeting high school students. Participants in this camp, however, came exclusively from community colleges. In this article, we provide an overview of the camp's activities, structure, and outcomes. We present a longitudinal analysis of student feedback, reflecting results from one survey administered before the camp began and another distributed very near the camp's end. Our results indicate the camp succeeded on many counts.     

Facts & figures

Financial Management in the NHS: a Manager's Handbook By H. Mellett, N. Marriott, S. Harris (Chapman and Hall, London, 1993), pp. xvii + 265. £29.50. ISBN 0 412 47320 8.

Competing for Quality—a Manager's Guide to Market Testing By Lynton Barker (Longman, Harlow, 1993). £38.50. ISBN 0 582 23688 6.

The Role of Chief Executives in Local Government By Janice Morphet (Longman, Harlow, 1993), pp. vi + 245. £29.95.     

Data-Snooping, Technical Trading Rule Performance, and the Bootstrap

In this paper we utilize White's Reality Check bootstrap methodology (White (1999)) to evaluate simple technical trading rules while quantifying the data-snooping bias and fully adjusting for its effect in the context of the full universe from which the trading rules were drawn. Hence, for the first time, the paper presents a comprehensive test of performance across all technical trading rules examined. We consider the study of Brock, Lakonishok, and LeBaron (1992), expand their universe of 26 trading rules, apply the rules to 100 years of daily data on the Dow Jones Industrial Average, and determine the effects of data-snooping.