Immigration of Nurses

This paper examines the effects of immigration on a specific occupation, registered nurses (RNs). To learn whether immigrant nurses reduced the earnings of RNs, we applied techniques developed by Goldin (1994) and Borjas, Freeman, and Katz (1996), but found the effect of immigrant penetration either positive or insignificant. We also found that the supply of immigrant RNs was far more elastic than the supply coming from natives. It is often argued that it will be hard to detect negative effects on wages and employment of natives in local markets, because natives will avoid a market which many immigrants have entered. This study finds no support for this hypothesis in this market, based on data that measures the rate of entry of RNs exactly. We find no adverse effect of immigration on native workers in this occupation.     

MONETARY POLICY ACTIVISM UNDER MANAGED-FLOATING EXCHANGE RATES: A CROSS-COUNTRY COMPARISON

This paper assesses the degree and pattern of monetary policy activism in the United States, Canada, West Germany, the United Kingdom, and Japan during the recent period in which managed-floating exchange rates prevailed. Floating exchange rates enhance the potency of a discretionary monetary policy. Yet central banks in these countries shifted toward less discretionary monetary targeting during the late 1970s in response to rising inflationary pressures and expectations. But whether such targeting actually reduced policy activism is unclear since targets were expressed in wide ranges and often were missed. Following 1981, at least three of these countries–the United States, Canada, and the United Kingdom–reverted to an avowedly more discretionary pattern of response to changes in real demand pressures, interest rates, and exchange rates. Since mid-1986, Germany, the United Kingdom, and Japan–and, to a lesser extent, Canada–have intervened heavily in the foreign exchange market and so have greatly increased their official dollar holdings. Moreover, through August 1987, the effects of this intervention on these countries' domestic money supplies apparently have been sterilized only partially.     

Rewards Available to Currency Futures Speculators: Compensation for Risk or Evidence of Inefficient Pricing?

Filter, channel and moving-average trading rules are compared with rules which use ARIMA price forecasts, by evaluating their ex ante performance for currency futures transactions from December 1981 to November 1987. All of the trading rules are profitable. Market efficiency is discussed Monte Carlo results strongly suggest that the trading profits are too large to be explained by the elusive, time-varying risk premium sought in forward market literature     

Racial Differences in Consumer Environmental Concern

Past research has suggested that black and white consumers differ in their concern for the environment. The general consensus has been that whites are significantly more concerned than blacks about environmental issues. Most of this research, however, Is limited in scope and fails to account for variables, such as education and income, which may help to explain these differences. This study investigates and analyzes black and white consumer environmental concern. Results of this study indicate that there are significant differences between African-Americans and white Americans in their environmental concern at lower income and educational levels. However, as income and education rise, the gap in environmental concern between blacks and whites significantly decreases. These findings provide important implications for policy makers in making decisions related to environmental education and protection as well as for businesses intending to target consumers with environmentally focused promotional campaigns.     

Optimal Aggregation of Money Supply Forecasts: Accuracy,Profitability and Market Efficiency

We present a general procedure for aggregating expert forecasts which exploits regularities in the structure of information within the forecaster population. Specific information structures lead to aggregation methods which adjust for additive bias, differences in individual accuracy, and correlation among forecasts. As an application, we construct composite predictions of the weekly change in the money supply from forecasts made by twenty major securities dealers, for which high positive correlation is found to be a significant characteristic. Due to instability in the information structure, our methods cannot improve on the accuracy of a simple average in this case. However, they do capture information about the correlation among money supply forecasts which is not fully impounded in short-term interest rates. Forecasts from our models accurately predict the direction of price changes for Treasury bills and Treasury bill futures after a money supply announcement.     

The Predictive Content of Earnings Forecasts and Dividends

This paper compares the properties of dividend announcements and management earnings forecasts as predictors of earnings and firm value. First, the two predictors are compared on the basis of their ability to predict earnings. Then the information they convey about firm value is assessed by comparison of the performance of investment strategies based on values of the two predictors. Finally, the effects of dividend announcements on stock prices are considered.     

Covered Interest Parity and Speculative Efficiency: Some Empirical Evidence for Australia*

Two key relationships which feature prominently through out modern international monetary theory are: (i) covered interest parity and(ii) speculative efficiency of the foreign exchange market, i.e., the unbiasedness of the forward rate as a predictor of the spot rate. This paper presents some empirical evidence for these two hypotheses using Australian data over the period September 1974 to December 1981 during which the Australian dollar was essentially floating. Both quarterly and overlapping monthly data are used. The results obtained generally provide some support for the two hypotheses.     

How Do Firms Respond to Political Uncertainty? Evidence from U.S. Gubernatorial Elections

We examine the joint response to political uncertainty along two margins: changes in real activity and voluntary disclosure. We focus on within-firm variation in exposure to ex ante competitive U.S. gubernatorial elections using data on preelection poll margins and firms’ state exposures. Despite real activity falling in the years leading up to a close election, we find that voluntary disclosure increases both in frequency and content, including mentions of risk in filings that reference states holding elections. Our tests use a decomposition of 8-K filings into real activity and voluntary disclosure to address the endogenous complementarity between these two responses. These results hold when using alternative ex ante measures of political uncertainty based on term-limited incumbents, historically competitive offices, or state legislature gridlock. Both effects of political uncertainty are stronger for firms in highly regulated industries and weaker for those least exposed to the local market, linking the real activity and disclosure responses to uncertainty.