The Annuity Puzzle and an Outline of Its Solution

In his seminal 1965 paper, Yaari showed that, assuming actuarially fair annuity prices, uncertain lifetimes, and no bequest motives, utility-maximizing retirees should annuitize all of their wealth on retirement. Nevertheless, the markets for individual immediate life annuities in the United States, the United Kingdom, and several other developed countries have been small relative to other financial investment outlets competing for retirement savings. Researchers have found this situation puzzling, hence the so-called “annuity puzzle.” There are many possible explanations for the annuity puzzle, including “rational” explanations such as adverse selection, bequest motives, and incomplete markets; and “behaviorial” explanations, such as mental accounting, cumulative prospect theory, and mortality salience. We review the literature on the various plausible explanations given for the existence of the annuity puzzle, suggest ways of stimulating the demand for annuities, and suggest a few of the ingredients needed for further development of hybrid annuity products that may provide a solution to the puzzle.     

The effects of labour strikes on consumer demand in professional sports: revisited

Previous research has concluded that the 1981 and 1994–1995 Major League Baseball (MLB) strikes have caused short-term losses in attendance but have not resulted in any long-term effects on attendance. While total attendance at MLB games following the 1994–1995 strike has recovered to its pre-strike levels, this has been done only through the construction of new stadiums at an unprecedented pace which cannot continue into the future. After accounting for stadium effects, average MLB baseball attendance has dropped significantly since the 1994–1995 strike.     

Benchmarking Australian fixed interest fund performance: finding the optimal factors

In this paper, we analyse the performance of Australian fixed interest managed funds and assess multiple benchmarks through which such performance can be reliably measured. We examine the effectiveness of seven indices of bond performance, as well as factors impacting on fixed interest asset values and, hence, returns, including interest rate fluctuations, economic fundamentals, maturity risk, default risk and cross‐market influences. We test all combinations of factors in cross‐section and time series to find the optimum benchmark. The results, consistent across time, show that a correct combination of a fund‐based market variable, a mixture of interest rate factors and economic factors as well as a proxy for movements in the equity markets yield the optimal benchmark.     

Instrumental quantile regression inference for structural and treatment effect models

We introduce a class of instrumental quantile regression methods for heterogeneous treatment effect models and simultaneous equations models with nonadditive errors and offer computable methods for estimation and inference. These methods can be used to evaluate the impact of endogenous variables or treatments on the entire distribution of outcomes. We describe an estimator of the instrumental variable quantile regression process and the set of inference procedures derived from it. We focus our discussion of inference on tests of distributional equality, constancy of effects, conditional dominance, and exogeneity. We apply the procedures to characterize the returns to schooling in the U.S.     

Consumer values among restaurant customers

The research presented in this article focuses on consumer values in restaurant meal experiences from the restaurant customers’ points of view. Based on a set of data, the purpose is to evaluate the customers’ perceived consumer values in restaurant meal experiences and to compare the results with other studies on consumer values and service quality and with studies of meal experiences. A modified grounded theory approach has been followed. The empirical data are based on seven semi-structured interviews of experienced restaurant customers in two cities in Norway. A conceptual model illustrates the coding process that shows the connection between the different categories. The data analysis produces different categories of consumer-specific values on three levels of integration. The lowest level includes 29 consumer values that are integrated into 13 specified values. On the highest level, five value categories of consumer-oriented values are specified. These are excellence, harmony, emotional stimulation, acknowledgement, and circumstance value, of which harmony is the most emphasised value among the restaurant customers.     

Editorial

Ohne Zusammenfassung     

Editorial

Ohne Zusammenfassung     

Analyzing a quantitative coordination relationship

Coordination is a crucial behavior in cooperative distributed problem solving (CDPS). Analyzing coordination requires an understanding of the interplay between the agents, their problem, and their environment. The core behaviors ofdistributed coordination in CDPS systems are the coherent specification and scheduling of tasks over the set of distributed agents working on sets of interrelated problems. The complexity of, and uncertainty about, the problem interrelationships make distributed task coordination difficult. This article describes a causal model of this process that links the interrelationships, calledcoordination relationships, to the local scheduling constraints of distributed agents. Besides coordination relationships, environmental uncertainty and the lack of infinite computational resources also make distributed coordination difficult.It is not only the presence or absence of a coordination relationship that is important, but its quantitative properties: how likely is it to appear, how significant is its effect, and so on. These aspects determine the usefulness of a particular coordination relationship in the context defined by an environment, a problem to be solved, and an agent architecture. This article discusses the analysis of coordination relationships, using as an example our abstract model for thefacilitates relationship. We detail the derivation and assumptions of this model and apply it to the design of a generalized coordination module that is separate from, and interfaces cleanly with, the local scheduler of a CDPS agent. A set of simulation experiments is described that test our assumptions and design process in the coordination of a group of real-time problem-solving agents.     

Macroeconomic News, Business Cycles and Australian Financial Markets

This paper examines the effects of news surprises of macroeconomic announcements on Australian financial markets across different business cycles. We find that overall, the news arrivals are influential in both stock and debt markets but in an interesting array of responses across asset classes. Debt markets are more responsive to macroeconomic news surprises compared to the stock market, hence supporting the notion that information revealed from the macroeconomic news is related to interest rates. Specifically, news about CPI is important over the full sample period and especially during expansions for both stock and bond returns while the unemployment rate news is influential to the money market rates. Furthermore, these effects are seemingly asymmetric in nature, with their directions and magnitudes conditional on the state of economy.     

Analyse de la consommation des biens culturels au Togo

This paper analyses the determinants of consumption decision and household expenditure on cultural goods in Togo, based on survey data from the 2015 QUIBB Basic Well‐being Indicators. The determinants of consumption decision are empirically estimated from a probit model while the determinants of consumption expenditure on cultural goods are estimated from a Tobit model and the CLAD (Censored Lead Absolute Deviation) method. The results show that the decision to consume cultural goods is positively affected by the higher level of education and the place of residence but negatively affected by the size of the household. Likewise, households' consumption expenditure is significantly influenced by income, education level, place of residence, household size, and religion. However, estimation by the CLAD method shows that the magnitude of the effect of these factors differs from one quantile to another. Furthermore, our results highlight a U‐shaped relationship between cultural spending and income. Taking these factors into account can help revive the cultural sector in Togo.