Using Compulsory Mobility to Identify School Quality and Peer Effects

Education production functions that feature school and student fixed effects are identified using students' school mobility. However, student mobility is driven by factors like parents' labour market shocks and divorce. Movers experience large achievement drops, are more often minority and free meal students, and sort endogenously into peer groups and school types. We exploit an English institutional feature whereby some students must change schools between grades 2 and 3. We find no evidence of endogenous sorting of such compulsory movers across peer groups or school types. Non‐compulsory movers bias school quality estimates downward by as much as 20% of a SD.     

Testing weak form efficiency on the Toronto Stock Exchange

In order to test for weak form efficiency in the market a vast pool of individual stocks must be analyzed rather than a stock market index. In this paper, a model-based bootstrap is used to generate a series of simulated trials and a modified chart pattern recognition algorithm is applied to all stocks listed on the Toronto Stock Exchange (TSX). The number of patterns detected in the original price series is compared with the number of patterns found in the simulated series. By simulating the price path specific time dependencies present in real data are eliminated, making price changes purely random. Patterns, if consistently identified, carry information which adds value to the investment process, however, this informativeness does not guarantee profitability. Conclusions are drawn on the relative efficiency of some sectors of the economy. Although the null hypothesis of weak form efficiency on the TSX cannot be rejected, some sectors of the Canadian economy appear to be less efficient than others. In addition, pattern frequencies appear to be negatively dependent on the two moments of return distributions, variance and kurtosis.     

The impact of the global financial crisis on the cross-currency linkage of LIBOR–OIS spreads

This article examines the impact of global financial crisis on cross-currency linkage of the LIBOR–OIS spread, a financial stress measure in interbank markets. The impulse response analysis is conducted in a multivariate setting, adopting the bias-corrected bootstrap as a means of statistical inference. The overall evidence suggests that the crisis has substantially changed the nature of the cross-currency interactions in liquidity stress. Also global money markets have failed to contain stress in US dollar funding and the role of the Japanese yen as a liquidity source appears to be significant, while these two currencies drive the cross-currency system of liquidity stress.     

A technical note on “Optimizing inventory decisions in a multi-stage multi-customer supply chain”

We first generalize Khouja [Khouja, M., 2003. Optimizing inventory decisions in a multi-stage multi-customer supply chain. Transportation Research Part E: Logistics and Transportation Review 39 (3), 193–208] integrated model considering the integer multipliers mechanism and next individually derive the optimal solution to the three- and four-stage model using the perfect squares method, which is a simple algebraic approach so that ordinary readers unfamiliar with differential calculus can understand the optimal solution procedure with ease. We subsequently deduce the optimal expressions for Khouja (2003) and Cárdenas-Barrón [Cárdenas-Barrón, L.E., 2007. Optimal inventory decisions in a multi-stage multi-customer supply chain: a note. Transportation Research Part E: Logistics and Transportation Review 43 (5), 647–654] model, and identify the associated errors in Khouja (2003). We present two numerical examples for illustrative purposes. We finally shed light on some future research by extending or modifying the generalized model.     

Impact of Auditor Report Changes on Financial Reporting Quality and Audit Costs: Evidence from the United Kingdom

While substantial revisions to auditor reporting requirements are being implemented internationally, the impact of these reforms on financial reporting quality is unknown. We exploit the United Kingdom's recent auditor reporting changes and find that the United Kingdom's new reporting regime is associated with an improvement in financial reporting quality as proxied by significant decreases in absolute abnormal accruals and the propensity to just meet or beat analyst forecasts, and a significant increase in earnings response coefficients. As for audit costs, we do not find a significant change in audit fees or audit delay surrounding the implementation of the new reporting regime. Taken together, the results of this study suggest that new auditor reporting requirements are associated with a significant improvement in financial reporting quality without detecting a significant increase in audit costs.     

Leverage and growth: Effect of stock options

Previous literature documents a negative relationship between leverage and firm growth. This paper finds that once the incentives provided by stock options are accounted for, leverage does not affect firm growth. The paper also finds that the sensitivity of CEOs’ wealth to stock price (i.e. option delta) instead of leverage has a negative relationship with growth. These findings suggest that incentive contracts that tie managers’ wealth to firm value prevent managers from overinvesting. Thus in presence of options the role of debt as a disciplining mechanism has become less important.     

Agricultural Export-Diversification and Economic Growth in Caribbean Countries: Cointegration and Error-Correction Models

This article uses cointegration and error-correction models to analyze the causal relationship between agricultural export diversification and economic growth in eight selected Caribbean countries using annual data from 1961 to 2000. The empirical results show that in the short run, agricultural export diversification Granger causes economic growth in Barbados and Belize. Noncausality exists for the other countries. In the long run, agricultural export diversification also Granger causes economic growth in the Dominican Republic. On the contrary, agricultural export diversification is the outcome of the economic growth process in Belize, Costa Rica, Haiti, and Jamaica, in the long run. Noncausality exists in Trinidad and Tobago. There is no evidence of bi-directional causality in any of the countries in either the short or long run.     

Age of first hunting experience: Results from a nationwide recreation survey

Abstract

Hunting participation, as indicated in the 1983 Nationwide Recreation Survey, is examined to determine the relationship between age of first hunting experience and adult level of participation. A statistically significant association between these two variables is found. In addition, more than 83 percent of those who hunt began their involvement by 18 years of age. The findings have implications for future hunting participation and the provision of programs for hunters.