The Bioeconomics of Marine Reserves: A Selected Review with Policy Implications

The paper ‘bridges the divide’ between the biological and economic literature on marine reserves. It provides a selected review of the traditional use of reserves, the early reserve literature, the potential benefits of reserves, spillovers from reserves to harvested areas and bioeconomic models of marine reserves. The bioeconomics literature is examined from the perspectives of deterministic models, spatial economic models and models that include uncertainty and stochasticity. Insights from the review are used to provide management implications in terms of reserve design, stakeholder cooperation and process, reserve-fishery transfers, traditional management controls, and ecosystem approaches to managing fisheries.     

Predicting MBA no-shows and graduation success with discriminate analysis

This paper uses discriminate analysis to examine five years of MBA admission records in order to separate no-shows from the successful program graduates. The study used traditional numeric data such as age, length of time with current employer, undergraduate GPA and GMAT scores—as well as dummy variables for sex, full- or part-time status, race, the public or private nature of the undergraduate institution, and in-state tuition eligibility. The analysis correctly separated the no-shows with a 94.2 percent classification rate based entirely on the use of dummy variables. Unlike other studies, undergraduate GPAs, GMAT scores, and other numeric variables played no role in the final classification. The results suggest that more attention be given to the use of dummy variables when it comes to predicting the success of MBA program graduates.The authors would like to thank the unfailingly efficient efforts of Geetanjali Goel, who helped retrieve and organize the data examined in this study.     

From the Editor

Report from the Editor as I start a second term. I outline success and otherwise in the first term and encourage authors to engage in the local research conversation when they are writing their papers. I point out that all methodological approaches are welcome including qualitative, survey, systematic literature reviews and experiments. I point out the hot points that Editors now are looking for so that you can pay particular attention to them in advance of submission.     

The preferences of tourists in their expectations of chateau gardens: a Central and Eastern European perspective

As most of the chateau gardens and parks in Central and Eastern Europe have been neglected or misused, there is a strong need for their transformation. This transformation has become even more important now due to the growing competition in the tourist destination market. The chateau gardens are at the crossroads of choosing the variant of their future development. Tourism of this kind is able to maintain its original features and it can also find new commercial uses. The aim of this paper is to identify the demand segments and to assess the relation of the visitors to the elements that form the character of a chateau park. We have succeeded in identifying three motivating factors for tourists in the making their choice. While some types of use are mutually complementary (knowledge and relaxation), other types are not used as much (amusement). The introduction of an entrance fee implies that there will be a change in the preference for those parks with the presence of peacocks and ducks, as well as the outdoor collections of plants including both French and English style gardens and they are equipped with detailed information board.     

THE ADVERSE EFFECT OF GOVERNMENT SPENDING ON PRIVATE CONSUMPTION IN NEW KEYNESIAN MODELS

Empirical evidence shows that government spending crowds in private consumption, a Keynesian phenomenon. The current, state of the art, New Keynesian models based on optimizing households and firms are not able to predict such a result. In this paper, we critically analyse fiscal policy in these models using a graphical framework as well as a formal model. Extensions aimed at generating crowding in, like useful government spending or rule of thumb consumers, turn out to be inappropriate. We argue that introducing productivity enhancing government spending could potentially lead to crowding in.     

Effect of ownership,governance, and transparency on liquidity – Chilean evidence

Companies with relatively thin trading, a high concentration of insider ownership, and a privatized pension system characterize Chile’s Santiago Stock Exchange. Within this setting, we study the relationship between ownership concentration, corporate governance, and stock market liquidity. Our results suggest that board independence, corporate disclosure and outside monitoring by institutions help moderate the effects that insiders have on trading costs and liquidity. We also find that market makers with inventory reduce the informational component of trading costs. Finally, the trades of insiders provide price guidance to market makers, while traders employ a follow-the-insider strategy when transparency is low.     

The Decision to Repurchase Debt

The authors examined the market reaction to announcements of 208 corporate offers to repurchase outstanding debt during the period 1989–1996. In most tender offers, debtholders receive either a fixed price or a fixed spread over a benchmark Treasury security, or a range of prices based on a Dutch Auction. In most cases, management cites as its main motive the desire to reduce leverage and/or interest expense. But such tender offers are also often—in fact, in 70% of cases—accompanied by consent payments intended to induce bondholders to vote to remove covenant restrictions. The authors found that tender offers are wealth‐increasing events, with positive average market reactions of almost 1.5%. But the means of funding has a major impact on the market reaction. Whereas tender offers financed with equity receive a neutral market response, those offers financed with the proceeds from asset sales are associated with equity announcement returns of 3.8%. What's more, shareholders respond positively to the removal of covenants, especially asset sale covenants, with abnormal returns averaging 11% in such cases. Before their offers, companies that tender for their debt tend to have less cash and more long‐term debt than comparable companies, and to have lower operating returns and to trade at a discount to their peers. But after the tender offer, assets increase, operating returns improve, and the tendering firms trade at a premium.     

The Flash Crash: Trading Aggressiveness,Liquidity Supply,and the Impact of Intermarket Sweep Orders

During the Flash Crash on May 6, 2010, a short period of high stock market volatility, some stock prices declined to $0.01, while others increased to $100,000. Examining Intermarket Sweep Orders (ISOs) before, on, and after May 6, we find that ISO use is substantially higher on May 6. For those stocks whose prices fell the most, over 65% of the sell volume comes from ISOs. During the price recovery period for these stocks, about 53% of the buy volume comes from ISOs. We believe that the unusual behavior of ISOs contributed to the sudden drop and recovery of the market.