A heuristic algorithm for determining lot sizes of an item subject to regular and overtime production capacities

The problem considered in this paper deals with the sizing and timing of replenishments for an item facing a time-varying, but known, pattern of requirements. Regular time and overtime (the latter at a cost premium) production options are available where there are production capacities that also can vary with time. The problem is to establish the pattern of replenishments so as to keep the total of setup, carrying and overtime premium costs as low as possible without any backlogging of demand and without violating any of the capacity constraints. A heuristic procedure, simple enough to implement manually, is developed and tested on a large representative set of problems. The resulting performance is excellent, namely an average cost penalty of only 0.5%.     

Question and Answer in 'A' Level Economics

Graham Dawson, Head of Economics at Bedford School, gives the third in the series of Model Answers for 'A' Level economics.     

Can We Privatise Competition Policy?

How large a role is there for government in competition policy? Graham Mather, general director of the Institute of Economic Affairs and a part-time member of the Monopolies and Mergers Commission, argues the case for loosening the Stock Exchange listing requirements.     

中国公司如何突破在美国投资的“围城”

20世纪80年代,日本的公司大量吞并美国公司和资产,美国国会的成员、各种商业联盟的领袖以及企业的领导者都开始大声疾呼,“日本人来了”!尽管在美国的经济发展历史上,尤其是在19世纪70年代到1914年的后工业革命时期,国外的投资者扮演了重要的角色,评论家们还是发出警告：当日本投资者来到美国的时候,情况是不同的。当     

A new perspective on performance persistence: evidence using portfolio holdings

We investigate the existence and sources of performance persistence for Australian equity funds, using monthly portfolio holdings data. We find significant persistence among outperforming rather than underperforming funds, which is primarily related to security selection skill, and is associated with growth‐orientated funds. Meanwhile, the relation between persistence and momentum is secondary and nuanced. Further, persistence largely derives from existing holdings, while subsequent active trading contributes only moderately positive returns for both outperforming and underperforming funds. We also find that persistence fades beyond 6 months and vanishes after 24 months. Our findings differ from those for U.S. equity funds and previous Australian studies, implying that persistence may vary with market context and its identification may depend on data availability.     

The influence of other comprehensive income on discretionary expenditures

Other comprehensive income items (OCI) increase and decrease book value and therefore indicate more or less firm value. It follows that OCI items, albeit transitory, may contribute to a wealth effect that influences expenditure decisions. In support, our regression results indicate an association between current year OCI and future discretionary financing, investing, and operating expenditures. However, we also find that OCI‐influenced expenditures are not associated with future profitability, suggesting such expenditures are not value creating. In further tests, we find that future discretionary expenditures are associated with both positive OCI and negative OCI for higher leveraged firms but only associated with positive OCI for lower leveraged firms. These results suggest that, for highly leveraged firms, positive OCI loosens debt constraints on future expenditures while negative OCI tightens debt constraints on future expenditures. For firms without debt constraints the results are suggestive of possible wealth transfers from debtholders to shareholders.     

REGIONAL ECONOMIC ACCOUNTING IN THE U.S. OFFICE OF BUSINESS ECONOMICS–AN APPRAISAL*

This paper discusses the conceptual framework in which regional economic accounts in the United States are viewed and the functions which those accounts serve. It points out that the major differences between regional and national accounts relate to factor returns to capital. First, returns to capital are extremely difficult, if not impossible, to measure meaningfully on a geographic basis. Secondly, because the capital market in the United States is a reasonably perfect one geographically, the return to capital that originates in a given region has little significance as either a stimulant or a constraint to production in that region. In terms of the functions of regional accounts, the point is made that whereas national economic accounts can aid economic decision-making in three general areas of policyallocation, distribution and stabilization—with perhaps greatest emphasis now placed on the last of these, regional accounts are most useful in matters relating to allocation and distribution. Information needed for the use of regional accounts in decision-making with regard to allocation and distribution problems is examined. Against these needs are placed an inventory of regional accounts which are available in the Regional Economics Division, Office of Business Economics. The available accounts are found to fall considerably short of those needed for allocation decisions. In contrast, regional accounts as presently constituted have much to offer as tools for analyzing the problems of regional economic distribution, although here too, much additional information is needed.     

The mitigation of high-growth-related accounting distortions after sarbanes-oxley

This study examines the effect of the Sarbanes-Oxley Act of 2002 (SOX) on accounting distortions in the context of the earnings quality of high-growth firms relative to lower-growth firms. High-growth creates unique management and reporting challenges that can contribute to accounting-related distortions. SOX, with its emphasis on financial reporting, control systems and management responsibility, could have been particularly relevant for high-growth firms with such challenges. Test results indicate a stronger reduction (weaker increase) in accounting distortions related to total accruals and book-tax differences (performance-matched modified Jones discretionary accruals) for high-growth firms from the pre- to the post-SOX period relative to lower-growth firms. Other tests indicate that the relation between accounting returns and market returns strengthened for high-growth firms in the period after SOX, but not for lower-growth firms. These results suggest greater reductions in accounting distortions and related improvements in reporting quality for high-growth firms relative to other firms coinciding with the post-SOX period.     

On the Measurement of Strength of Preference in Units of Money

We report an experimental study that aims to elicit monetary measures of strength of preference in choices involving pairs of risky prospects. Despite extensive testing to refine the instruments used, we find that these money measures are systematically biased upwards relative to subsequent binary choices. We discuss possible reasons for this bias and its broader implications.