Constructing Commercial Indices: A Semiparametric Adaptive Estimator Approach

Constant-quality commercial indices generated by ordinary least squares may suffer an efficiency loss due to leptokurtosis caused by outliers in transactions data. When the subsequent nonnormality occurs, substantial improvement in index precision is obtained by estimating the hedonic model using a semiparametric adaptive estimator technique. When this method was applied to 1,846 office transactions that occurred in the Phoenix metropolitan area from January 1997 through June 2004, a substantial standard error reduction of approximately 9% was realized relative to ordinary least squares estimates. The difference in average returns between the semiparametric method and ordinary least squares was about 0.25% in each period, which represents a substantial increase in commercial property index precision. JEL Classification C4 R0     

Discrimination Against Latin American Workers During Pre-Olympic Games Construction in Vancouver

This article discusses a recent decision by the British Columbia Human Rights Tribunal which found discrimination to be present against workers from Latin America employed on construction of the Canada Line rapid transit link, built in preparation for the 2010 Vancouver-Whistler Winter Olympics. The tribunal concluded that the workers’ race, color, ancestry and place of origin were factors in mistreatment by the employer and a prima facie case of discrimination was established with regards to the Latin American workers who were treated adversely compared to Canadian and European workers. This essay analyzes issues of exploitation of migrant workers from Latin America and the difficulties facing labor unions in defending their members, including the costs of such hearings and the firing of workers by employers. This is a significant case for labor rights in a global context.     

Congestion and Distribution of Rents in Wheat Export Sector: A Canada–U.S. Cross‐Border Comparison

In Canada, average grain freight rates are regulated via the Maximum Revenue Entitlement (MRE), while on the US side of the border grain rates are subject to very little oversight. We use this natural experiment to explore how the MRE regulation has impacted freight rates and the distribution of rents in the wheat supply chain since 2012. On both sides of the border, when large crops have exceeded the short‐term capacity of grain export channels to move the crop, export basis has increased and reduced producer prices. In locations not subject to barge competition, US grain freight rates are higher than Canadian rates and are bid up further during periods of congestion. In Canada, MRE regulation redistributes rents away from railways toward grain companies and producers. These higher grain handling margins have increased the incentives to build additional port terminal capacity in the post‐CWB single desk environment. Au Canada, les tarifs marchandises moyens des céréales sont règlementés par le Revenu admissible maximal (RAM), tandis qu'aux États‐Unis, les tarifs céréaliers font l'objet de très peu de suivi. Au moyen de cette expérience naturelle, nous explorons l'impact du RAM sur les tarifs marchandises et sur la distribution des rentes dans la chaine d'approvisionnement du blé depuis 2012. Des deux côtés de la frontière, lorsque de vastes cultures ont excédé la capacité à court terme des voies d'exportation céréalières pour distribuer leurs récoltes, le seuil d'exportation augmente et réduit les prix des producteurs. Là où ils ne sont pas assujettis à la compétition de barges, les tarifs marchandises céréaliers américains s'avèrent plus élevés que les tarifs canadiens et se voient encore surenchéris lors de période de congestion. Au Canada, la règlementation du RAM redirige les rentes des compagnies ferroviaires aux entreprises et producteurs céréaliers. Ces marges de manutention plus élevées ont augmenté les incitatifs pour accroître la capacité des ports‐terminaux dans un environnement à pupitre unique, post Commission canadienne du blé.     

A multilevel examination of the relationship between role overload and employee subjective health: The buffering effect of support climates

Although the belief that support alleviates the detrimental effect of job demands on employee health is intuitive, past research has produced an equivocal picture, requiring a renewed evaluation of this relationship. In the present study, we examine three sources of support (from the organization, leader, and team) that employees may draw from to reduce the negative effect of a specific job demand, that is, role overload. Unlike most prior research, we focus on these sources of support at the group level of analysis to determine the relative effectiveness of organizational support climate, leadership climate, and team climate as moderators of the role overload–subjective health relationship. Hierarchical linear modeling of data from 2,288 employees nested in 132 workgroups in a state administration of Switzerland revealed that, after controlling for individual perceptions of support, team climate weakened the negative relationship between role overload and health. We did not find support for the buffering effect of organizational support or leadership climates. The article provides a nuanced test of the support‐buffering hypothesis by simultaneously exploring individual and group‐level sources of support and by demonstrating that some sources of support matter more than others in ameliorating the negative outcomes of role overload.     

Who Says there is a High Consensus Among Analysts when Market Uncertainty is High? Some New Evidence from the Commercial Real Estate Market

This paper seeks to determine whether analyst consensus is a function of the level of price informativeness, and therefore attempts to gauge the extent to which analyst consensus is high when market uncertainty is high. There is the view that a small or declining volume of trading implies less information and lower quality information, and that a lower level of price informativeness will lead analysts to put more weight on their private information at the time of forecasting. We add to this view the notion that when uncertainty is high there might be a positive option value of waiting. In this case, it appears reasonable to conclude that analysts may actually lack consensus when uncertainty is high. If this hypothesis is correct, then one would expect the level of price informativeness to override the Keynesian incentive “to fail conventionally than to succeed unconventionally” or at least reduce its magnitude in periods of declining trading volume and low price discovery. Tests of this hypothesis produce favorable results.     

Consumer responses to private nutrition signals

Mandatory labelling of nutrition information with a numerical nutrition facts panel is commonly required for prepackaged food products. Recently, food manufacturers and retailers have developed simplified nutrition signals such as front-of-package labelling (e.g. the Traffic Light label) or retail shelf labels (e.g. Guiding Stars), which provide a more intuitive signal of nutritional content. Using survey data from a sample of consumers from western Canada, this paper examines consumer responses to two private nutrition labelling programs: Guiding Stars and the Traffic Light label. Consumers are more receptive to the Traffic Light label than the Guiding Stars. Ordered probit models explore the factors influencing the likelihood of using these nutrition signals. Trust in the food label, perceived difficulty of using nutrition information, nutrition knowledge, and the importance placed on nutrition influence receptively to these labels. Simplified nutrition labels are likely to complement, rather than substitute for, the existing Nutrition Facts Table.     

Do Out‐of‐State Buyers Pay More for Real Estate? An Examination of Anchoring‐Induced Bias and Search Costs

We explore the questions of whether and why out-of-state buyers pay more for real estate than their in-state counterparts. Theoretically, we develop a model capable of explaining a premium if out-of-state buyers have high search costs, upwardly biased beliefs about prices or an unusually short time horizon to purchase. Empirically, we find that out-of-state buyers pay a statistically significant and economically meaningful premium for apartment complexes in the Phoenix area. We also find some evidence consistent with the premium being driven by high search costs, biased beliefs (anchoring) and haste associated with out-of-state buyers.     

Spatial Correlation in Expected Returns in Commercial Real Estate Markets and the Role of Core Markets

This study is based on survey data on investor expectations for 40 metropolitan statistical areas (MSAs) in the US over the period from 2003:Q2 to 2014:Q2. The paper has two main objectives. These are firstly to identify whether expected rates of return across different commercial real estate markets are positively spatially correlated and secondly to analyze the role of core markets like New York, Washington, DC, Los Angeles, San Francisco, and Chicago in the information-spreading process. All the tests conducted are conditional on the maintained hypothesis that expected returns across different markets are spatially uncorrelated. To carry out these tests, we regress a measure of excess return in each of the 40 markets on (contemporaneous) measures of expected returns in other markets, controlling for the interaction between (neighboring) markets. We find very large spatial interaction coefficients across different markets. Our basic estimates yield a spatial correlation coefficient of near one and statistically significant at standard levels. Chow tests allow rejection of the hypothesis that core markets like New York, Washington, DC, Los Angeles, San Francisco, and Chicago are no different than markets like Cleveland, Columbus, Orlando, Pittsburgh, Salt Lake City, St. Louis, and Tampa in explaining the covariances of the rates of return among different commercial real estate markets. Tests of structural change also imply that core markets currently play a more prominent role that in the past in the transfer of information from one market to another.     

Spoils from the Spoiled: Strategies for Entering Stigmatized Markets

Stigmatized markets are those where either the products/services, or the consumers, or both, have been collectively, negatively stereotyped and devalued by one or more stakeholder audiences in ways that discredit the overall market. Many stigmatized markets exist, and many flourish, yet little systematic attention has focused on entry into such markets. Our article addresses this gap by conceptualizing various strategies for entering stigmatized markets. We further present propositions regarding the market‐level factors that can influence which of these strategies firms will choose to employ. The contributions include: conceptually clarifying the nature of stigmatized markets; identifying additional types of entry strategies relevant for entering stigmatized markets; theorizing the conditions under which firms would choose one entry strategy over another; and opening up for consideration the effects that market entry may have on stigmatized actors in targeted markets.