The Impact of Market Maker Competition on Nasdaq Spreads

This study utilizes a comprehensive database containing monthly information on the number of market makers for about 5,288 Nasdaq securities over an eight-year period to investigate the impact of competition on spreads. A variety of models are estimated in order to demonstrate the robustness of the results that include four specific findings: (1) the number of market makers has a negative and highly significant impact on spreads; (2) the relation is nonlinear with a decreasing impact by the marginal market maker; (3) Nasdaq spreads have been declining over time; and (4) structural changes in Nasdaq are associated with significant changes in the relationship between spread and the number of market makers. One improvement over the literature includes allowing endogenous competition through the use of instrumental variables.     

Minimum wages and unemployment: the reform of the Wages Councils

Government policy has fallen short of total abolition of wages councils. In this article the authors argue that whilst reforming the wages councils might result in young workers getting jobs at the expense of older workers there is no evidence to suggest that cutting adult wages will increase the level of employment.     

Order preferencing, adverse-selection costs, and the probability of information-based trading

Although prior studies offer various conjectures on the causes and consequences of order preferencing, there is only limited empirical evidence. In this study, we show that the extent of order preferencing is significantly and negatively related to both the adverse-selection component of the spread and the probability of information-based trading. This result is consistent with the prediction of the clientele-pricing hypothesis that dealers (brokers) selectively purchase (internalize) orders based on information content. Our results suggest that order preferencing may not be as harmful as some researchers have suggested and offer some rationale for its prevalence in securities markets with heterogeneously informed traders. JEL Classification G18 · G19     

Problem-solving processes in technology education: A pilot study

This paper reports the preliminary results of a pilot study investigating the nature of problem-solving activity in technology classrooms. The research focuses on the relationship and potential mismatch between teachers' and children's agendas, aims, perceptions and beliefs concerning design and technology activities. A case study of an 11-week project was undertaken with four pupils aged 13. In-depth classroom observation and interviews allowed us to investigate the problem solving used in designing and making a kite, and the pupils' application of the knowledge required. Our analysis charts the influence of the teacher's task structuring and interventions on the children's problem-solving behaviour. The results indicate that the design process is highly complex and not always communicated successfully by teachers. What children typically encounter in design and technology projects are different problems requiring different approaches according to the kind of task and the stage reached in its solution. The popular idea that problem solving in technology denotes a holistic design-and-make process is hence under challenge. Moreover, the assumed access and application of relevant bodies of knowledge from other contexts is highly problematic.