Regional variations in US consumer response to price changes in home heating fuels: the Northeast and the South

This paper considers the paradox of a consistent net outflow of people from areas of high job creation and wages over the past 20 years and suggests the explanation that different individuals have different motivations for moving. The Labour Force Survey indicates that workers moving for job reasons have migrated to areas of low unemployment and high nominal wages. However, the inflow into such areas has been more than compensated for by an outflow of people moving for non-job reasons. A logit analysis of destination choice indicates that job movers are attracted to areas with high wages but are not affected by high house prices in such areas. In contrast, active non-job movers are deterred from areas of high house prices. Regional house price differences do not influence the destination choice of homemakers or the terminally sick but they do influence the destination choice of retirees. All groups prefer to travel the least distance when moving.     

Consultation and communication in family businesses in Great Britain

Nationally representative data on family businesses are available in the 1998 Workplace Employee Relations Survey, alongside comparable information for other types of firms. We use these data to compare differences in the use of different consultation and communication procedures. We cover such practices as the use of direct communication schemes (e.g. briefings; the provision of information on financial performance to the workforce) as opposed to indirect methods such as the use of joint consultative committees. There is an a priori expectation in the literature that family-owned businesses are either more likely to use direct forms of communication (vis-à-vis indirect forms) or that they will not be involved in direct communication or consultation with their employees, and we test this using multivariate techniques. Finally, we consider whether the type of consultation/communication structure matters in terms of establishment performance, and what differences exist with respect to family-owned businesses. In particular, this paper tests if those firms that consult directly with staff, as opposed to those that consult through joint consultative committees or trade unions, have higher productivity and/or other measures of performance. Concurrently we test whether there are separate ‘family business’ effects or whether it is generally establishment size that ‘matters’, by estimating a model for family-owned and non-family-owned establishments. In general, our results show that not only do family-owned establishments have lower levels of communication and consultation, but, when the latter is present, this does not generally translate into greater economic benefits (as is the case in non-family-owned firms).     

Tax evasion and heuristics: A research note

The paper examines the heuristics which taxpayers use in making tax evasion decisions. The following propositions are tested in an experiment using students. First, the taxpaper's own level of evasion will be positively related to what he perceives as the levels of evasion by others. Second, taxpayers who have been audited are more likely to assess the probability of audit as higher and therefore decrease their levels of evasion. The experimental results fail to support the first proposition but do support the second suggesting the presence of an ‘availability’ effect.     

Sharon Ghamari-Tabrizi. The Worlds of Herman Kahn: The Intuitive Science of Thermonuclear War. Cambridge, Mass.: Harvard University Press, 2005. 387 pp. ISBN 0-674-01714-5, $26.95.

When Herman Kahn published On Thermonuclear War in 1960, heshocked readers by thinking the unthinkable, that is, by visualizingthe effects of various levels of preparedness and civil defenseon the rates of survival in the event of a devastating thermonuclearattack on the United States. As he did so, however, Kahn cloakedhis futurological scenarios in a strange mix of mathematicalcalculation, gallows humor, and a tendency to ignore some ofthe hideous consequences of thermonuclear     

Agricultural trade in North America: Trade creation, regionalism and regionalisation

Trade creation in agricultural products is defined as a statistically significant positive break in the trend function of the growth in exports and imports between member countries. The present study attempts to determine the time of any break in the trend of real exports and imports between the Canada–USA Free Trade Agreement (CUSTA) and the North American Free Trade Agreement (NAFTA) member countries for the years 1980:I through 1999:II, and document the scale of the phenomenon. The present study finds trade creation only occurs in USA agricultural exports to Canada because of CUSTA. The results confirm the theory that the regionalism of NAFTA did not lead to regionalisation or an increasing share of intraregional international trade.     

SEASONED EQUITY OFFERINGS FOR NEW INVESTMENT AND THE INFORMATION CONTENT OF INSIDER TRADES

Significant negative valuation effects are widely acknowledged for firms announcing seasoned equity offerings. This result is consistent with theoretical models linking new equity issues to increased adverse-selection costs, lower management ownership in the firm, misuse of free cash flow, or expectations for earnings declines. Also increasingly evident, insiders trade around corporate announcements. We test the hypothesis that insider trading and announcements of new equity issues serve as joint signals in the market's evaluation of prospective capital investment projects. Our findings are consistent with the hypothesis that insider trading is related to market reaction to announcements of new equity issues.