On the existence of single-price equilibria in a matching model with divisible money and production cost

The present paper investigates Zhou's (1999) money search model, where money is divisible, agents can hold any amount of money and production of goods is costly, and presents a sufficient condition, expressed in terms of exogenously given parameters, for the existence of single-price equilibria.     

A New Phase in Economic Growth

<正>Deng Xiaoping said'We should allow some people to get rich first,and the rest will follow.'Now it’s time for the rest to follow,as the Chinese government has...     

Credit Contagion and Trade Credit: Evidence from Small Business Data in Japan

The present study investigates whether credit contagion leads to a decrease in trade credit for small businesses. In 1997–1998, the Japanese economy experienced a deep recession, and the domino effect caused an increase in the number of dishonored bills and bankruptcy filings. During a period of credit contagion, the possibility of default increases for firms with more financial claims and lower cash holdings. We find that during a recession, trade payables for small businesses with higher trade receivables and lower cash holdings are reduced. The hypothesis that the effects of credit risk on trade payables are weakened is not supported.     

Stationary monetary equilibria with strictly increasing value functions and non-discrete money holdings distributions: An indeterminacy result

In this paper, we present a search model with divisible money in which there exists a continuum of monetary equilibria with strictly increasing continuous value functions and with non-discrete money holdings distributions.     

An Analysis of Income Distribution between the North and the South: the Grossman–Helpman and Lai Results Re‐examined*

This paper studies the effects of labor supply on relative wages in a dynamic North–South model of trade. Lai (1995 )—a generalization of the Grossman and Helpman (1991a,b , ch. 11) models—showed that the relative wage of skilled (unskilled) labor in a region is positively (negatively) related to the supply of skilled (unskilled) labor in that region. These surprising results depend crucially on the specification of the functional form of the Southern imitation activity. We will show that these results (except for the relative wage of unskilled labor in Lai) are reversed in the case where the productivity of imitation depends only on the number of products the North manufactures.     

Process and context in choice models

We develop a general framework that extends choice models by including an explicit representation of the process and context of decision making. Process refers to the steps involved in decision making. Context refers to factors affecting the process, focusing in this paper on social networks. The extended choice framework includes more behavioral richness through the explicit representation of the planning process preceding an action and its dynamics and the effects of context (family, friends, and market) on the process leading to a choice, as well as the inclusion of new types of subjective data in choice models. We discuss the key issues involved in applying the extended framework, focusing on richer data requirements, theories, and models, and present three partial demonstrations of the proposed framework. Future research challenges include the development of more comprehensive empirical tests of the extended modeling framework.     

De‐commitment to losing strategic action: evidence from the divestiture of poorly performing acquisitions

We use a mental accounting framework to study the conditions in which CEOs de‐commit to poorly performing acquisitions and so become more likely to divest them. We test this framework by contrasting the experiences of 68 firms that divested acquisitions with a control sample of 68 firms that did not divest their acquisitions. Consistent with the theory that we use to explain and predict de‐commitment, our results suggest that poorly performing acquired units tend to be divested when executives can place them within ‘attributional accounts’ (i.e., accounts for the cause of the performance that do not incriminate them) and ‘comprehensive accounts’ (i.e., within the context of overall firm performance). Copyright © 2006 John Wiley & Sons, Ltd.     

SEARCH AND VACANCY COSTS IN THE TOKYO HOUSING MARKET: ATTEMPT TO MEASURE SOCIAL COSTS OF IMPERFECT INFORMATION

The social cost of imperfect information, in terms of buyers' search costs and sellers' opportunity costs of vacancy, is estimated in the real estate market of resale condominiums in central Tokyo by using a new, comprehensive dataset of resale condominium transactions. The results suggest a substantial social cost. Specifically, if housing information were perfectly available and marketing time were null, sellers would get benefits of 22.59% of imputed net rents of their property. In addition, buyers would save 1,042,000 yen spent on search activities for one transaction, if information were perfect. This is equivalent to 13.2% of buyers' average annual income.     

Spurious regressions in technical trading

This paper investigates the spurious effect in forecasting asset returns when signals from technical trading rules are used as predictors. Against economic intuition, the simulation result shows that, even if past information has no predictive power, buy or sell signals based on the difference between the short-period and long-period moving averages of past asset prices can be statistically significant when the forecast horizon is relatively long. The theoretical analysis reveals that both ‘momentum’ and ‘contrarian’ strategies can be falsely supported, while the probability of obtaining each result depends on the type of the test statistics employed.