How to measure mutual fund performance: economic versus statistical relevance

In the present paper a comprehensive assessment of existing mutual fund performance models is presented. Using a survivor‐bias free database of all US mutual funds, we explore the added value of introducing extra variables such as size, book‐to‐market, momentum and a bond index. In addition to that we evaluate the use of introducing time‐variation in betas and alpha. The search for the most suitable model to measure mutual fund performance will be addressed along two lines. First, we are interested in the statistical significance of adding more factors to the single factor model. Second, we focus on the economic importance of more elaborate model specifications. The added value of the present study lies both in the step‐wise process of identifying relevant factors, and the use of a rich US mutual fund database that was recently released by the Center for Research in Security Prices.     

The dynamics of economic systems,or how to transform a failed socialist economy

How to transform a failed socialist economy raises questions about the processes of structural and institutional changes, which standard economics is inadequately equipped to study. An economic theory that can study both these processes is suggested and applied to the actual debate of how the transformation should be conducted. Standard notions of institutional roles (R) and organizational structures (S) are seen in a non-standard way as outcomes of two interrelated but distinct evolutions. Comparing different given Rs for their influence on S-evolution throws new light on which R should be the target of the transformation. Compared to standard analysis, the case against socialism on the supply side is strengthened, whereas the case against a redistributive welfare society on the demand side is weakened. S-evolution is shown to require more time and be more difficult to be helped by government than R-evolution. This clarifies several controversial points about the speed and the sequencing of the transformation policies. The study of R-evolution discloses an important cognitive constraint on these policies, which teaching of economics can help to soften. Standard economics, shown to be a special case of the suggested theory, is rehabilitated as the best subject by which such teaching should start.     

An exploratory study of exclusive dealing in channel relationships

The channel literature has paid little attention to issues related to exclusive dealing governance arrangements. Consequently, there is only limited knowledge about how exclusive dealing impacts various channel processes and outcomes. This gap is especially regrettable since exclusive dealing, in addition to being one of the most commonplace governance formats within the distribution channels, is also one of the best exemplars of viable unilateral governance formats. In this initial investigation, the authors explore the linkages among the constructs of exclusive dealing, relationalism, communication, and performance. Empirical data for the study were drawn from the photocopier industry. He obtained his M.B.A. and D.B.A. degrees from Boston University. His primary research interest includes channels of distribution, franchisor-franchisee relationships, and consumer purchase behavior in international contexts. He has published articles inJournal of Marketing Channels and the proceedings of several marketing conferences. This article was crafted when Rajiv Dant was at Boston University. He received his M.B.A. from Bombay University and his Ph.D. from Virginia Polytechnic Institute and State University. His research focuses on channels of distribution, with primary emphasis on franchise structure, franchisee-franchisor relationships, and public policy aspects of franchising growth and ownership topics. His research has been published inJournal of Marketing, Journal of Public Policy & Marketing, Research in Marketing, Journal of Retailing, Journal of Business Research, Journal of Business Venturing, Journal of the Operations Research Society, Marketing Letters, Journal of Small Business Management, Journal of Economic Psychology, Southern Business & Economics Journal, Philosophical and Radical Thought in Marketing, Journal of Healthcare Marketing, Journal of Marketing Channels, andInternational Small Business Journal.     

Low Income Dynamics in 1990s Britain

This paper analyses low income dynamics in Britain using the first four waves of the British Household Panel Survey. There is much low income turnover: although there is a small group of people who are persistently poor, more striking is the relatively large number of low income escapers and entrants from one year to the next. Simulations using estimated low income exit and re-entry rates demonstrate the importance of repeated low income spells for explaining a person's experience of low income over a given period. We also document the characteristics of low income stayers, escapers and entrants.     

Free cash flow, debt-monitoring and managers' LIFO/FIFO policy choice

This paper explores the explanatory power of Jensen's free cash flow hypothesis in managers' choice of LIFO versus FIFO. The association between FCF, and choice of inventory methods is based on the assumption that there is a potential conflict of interest between managers and shareholders when LIFO is the tax minimization method and that non-value-maximizing managers of firms with the FCF problem have incentives to choose FIFO, an income increasing method, in order to increase their compensation. However, since debt can act as a monitoring device and mitigate the agency problems of FCF, managers of firms with high FCF and high debt are less likely to choose FIFO than managers of firms with high FCF and low debt. The evidence is consistent with this expectation.     

Squatting as a transition problem in South Africa

This paper applies principles of transition to land tenure and squatting in South Africa. Political transition in South Africa reassigned political property rights, which produced contestable, and rent‐seeking incentives for squatting as a means to privatize land and redistribute wealth. Government failure to establish and protect private property rights in a squatter camp resulted in common‐pool problems that resisted private and public resolution with consequent rent dissipation and social loss. In response to this retreat from duty, informal agents emerged to claim their own share of the prize. Without enforceable rules of capture, the growth of squatter camps in South Africa will continue. JEL classification: D7, H8, K1, K4, R1, R4.     

The Economic Benefits of Australian University Degrees: Bachelor and Research Higher Degrees

The investment in Australian bachelor and research degrees results in significant economic benefits for the individual and for society.