Non‐linear Predictability of UK Stock Market Returns*

Linear predictability of stock market returns has been widely reported. However, recently developed theoretical research has suggested that due to the interaction of noise and arbitrage traders, stock returns are inherently non‐linear, whereby market dynamics differ between small and large returns. This paper examines whether an exponential smooth transition threshold model, which is capable of capturing this non‐linear behaviour, can provide a better characterization of UK stock market returns than either a linear model or an alternate non‐linear model. The results of both in‐sample and out‐of‐sample specification tests support the exponential smooth transition threshold model and hence the belief that investor behaviour does differ between large and small returns.     

Ethical Outsourcing in UK Financial Services: Employee Rights

Outsourcing is becoming a major option in British business, including the financial services industry, and it raises a number of ethical considerations. The author of this major ethical study contends that "Outsourcing seems to present a particular threat to employees ... because of the factors which have led to outsourcing and the way in which it tends to work." Mike Henderson is an Associate of the Chartered Institute of Bankers and Senior Lecturer in Financial Services in the School of Financial Studies and Law of Sheffield Hallam University, City Campus, Pond Street, Sheffield S1 1WB, England.     

Action Teams That Work

A growing awareness of workplace hazards and identification of airborne contaminants, coupled with a changing safety and health regulatory environment, created an unexpected demand for new and innovative respirators in the early 1980s. 3M's Occupational Health and Environmental Safety Division broke new ground by taking the team concept further than ever before in the company. The division's Action Teams successfully designed, built and introduced products in less than half the time it would have taken previously. Robert Hershock, Charles Cowman and Douglas Peters describe how 3M learned important lessons about team selection, training, performance and motivation, the importance of project sponsors, and the role of middle management.     

Racial disparity in the atlanta housing market

Atlanta has the reputation of being a city of opportunity for blacks. However, in Atlanta, as well as in other cities across the nation, the nexus of racism and economic discrimination has resulted in disparities between the housing status of blacks and whites. This article examines racial disparities in the Atlanta housing market. It begins by tracing recent trends in the Atlanta-area economy and by providing background information on the local housing market. It then discusses the roles of the federal Home Mortgage Disclosure Act of 1975 and Community Reinvestment Act of 1977 in the efforts of local groups to reduce racial disparities in the housing market. The final section discusses recent local developments that might lead to improvements in the housing status of black Atlantans.     

Bond Yields, Ratings, and Financial Information: Evidence from Public Utility Issues

This study investigates the relative roles of bond ratings and financial information in the setting of bond yields. Structural equation modeling techniques are used to learn whether ratings determine yields or whether both ratings and yields are determined by a concurrent set of economic and financial factors. Tests of alternative structural model configurations provide evidence regarding the associations between bond ratings, financial information, and bond yields. Both ratings and financial information are found to play an important role in determining bond yields. In addition, yields are consistent with the higher rating in cases of split ratings.     

The local economic impact of construction projects in a small and relatively self-contained economy: The case of Lancaster University

Whilst the local multiplier impacts of the annual operation of universities has been the subject of intensive research, the economic impacts of capital construction projects have been almost completely ignored. This paper presents the results of detailed analysis of capital projects at Lancaster University in 1993-The reasons for the radically different annual operation and construction multipliers estimated in the Lancaster study are examined. Despite the smaller size of construction multipliers it is argued that it is a serious mistake to estimate local construction multipliers by making simplifying assumptions on the size of the key parameters in the multiplier equations.