International Monetary Policy: A Global Taylor Rule

John Taylors rule for setting interest rates provides a framework for studying the global monetary policy generated by individual countries pursing their own policy goals. The study reflects the global nature of monetary policy by modeling an aggregate short-term interest rate as a function of measures of worldwide inflation and the GDP gap. Multiple specifications are estimated to correspond to past studies of the U.S. relationships between these variables. The authors find that Taylor rule is a useful tool for characterizing the global monetary environment as his equation provides a good fit to the data in every specification explored by the authors. However, the international response to inflation is slightly less robust despite claims of inflation targeting by the bulk of the larger economies in the sample.     

Price performance of common stock new issues

The paper studies both the initial and aftermarket performance (measured by risk-adjusted returns) on newly issued common stocks which were offered to the public during the 1960s. The results confirm that average initial performance is positive (11.4 percent), while the distribution of returns is skewed so that the subscriber of a single random new issue offering has about an equal chance for gain or loss. The results are generally consistent with aftermarket efficiency. Positive initial performance along with aftermarket efficiency indicate that new issue offerings are underpriced. The paper provides insights into this underpricing mystery, but does not solve it.     

Simulation study of a closed-loop job shop

This study investigates the behavior of a job shop depicted as an integral component of a firm. A market places demands for the firm's products by dynamically evaluating the organization's quoted delivery times and actual delivery performance. The closed-loop model simulated in this study is described and the salient research results are reported. These experimental outcomes suggest that other conventional open-loop job shop studies tend to neglect important interactions with factors external to the shop itself.     

A causal analysis of environment-reward-satisfaction linkages for the sales representative

A causal model that postulated linkages of organizational environmental variables, reward variables, and satisfaction for sales representatives was investigated. Findings indicated that the usual assumptions concerning an organization's inability to contribution to intrinsic rewards may not hold.     

Coase's lighthouse

Roger Bate argues that Professor Ronald Coase's famous article The Lighthouse in Economics has important lessons for resolving environmental problems.     

Using Forecasting Criteria to Identify Value Relevance in the Relationship Between Accounting Numbers and Market Value

We explain and demonstrate a disciplined and systematic approach to repeatable modelling using forecast criteria, in addition to the usual statistical estimation criteria, to identify value relevance in regressions of the market‐accounting relation. The method was used in Cooke et al. ( 2009 ). It is illustrated here in the case of a single firm over a 59‐year period. Market and accounting data for the U.S. firm Abbott Laboratories Inc. from 1955 are modelled using a testing‐down, error correction approach. Hold‐out samples of 10 to 15 years are used to assess forecasting performance relative to a random walk. Emphasis is placed upon the use of simple, directly observable and theory‐independent model variables that can be replicated with other sample data. In this case, logarithmic transformations of all variables have to be computed in order to achieve correct statistical specification, implying a multiplicative relationship in the raw data. The strongest cointegrating accounting variable with forecasting ability for Abbott's market value is earnings. The model parameters exhibit long‐run stability and the accounting regressor marginally improves forecasts of market value compared to a random walk, demonstrating ‘value relevance’.