Are the Best Small Companies the Best Investments?

Previous research finds that large companies previously judged to be excellent growth companies have subsequently been poor investments. We examine small companies selected by Business Week on the basis of multiple criteria used in annual articles featuring highly rated growth companies. We study the investment performance over the three years before eleven annual Business Week publications and the three years after publication. We find positive excess returns in the pre‐publication period, but negative excess returns in the post‐publication period. This reversal in investment performance appears to be due to a mean‐reversion tendency in operating performance, in which the earnings and the past rates of return on capital of such companies subsequently decrease significantly.     

Good News and Bad News: Search from Unknown Wage Offer Distributions

The largest market in national economies is the labor market. Labor market contracting is characterized by job search, often from unknown wage offer distributions. This paper reports experimental tests of finite horizon models of job search in which the wage offer distribution is unknown. Theoretically-optimal search from an unknown wage offer distribution can have the seemingly paradoxical property that some offers will be accepted that are lower than other offers that will be rejected in the same period of the search horizon. Thus the reservation wage property (or lowest acceptable wage path) may not exist. This can occur because an offer that is a priori relatively high (good news) can imply that it is highly probable that search is from a favorable distribution, and such an offer can look unattractive when it is an a posteriori relatively low offer from a favorable distribution (bad news). This paper reports results from experimental treatments for search from unknown distributions in which the reservation wage property does exist and treatments in which it does not exist. We find that the consistency of search behavior with search theory reported in earlier papers is robust to the presence or absence of the reservation wage property and to whether the draws come from known or unknown distributions.     

你的国家可能是下一个希腊

孕育了民主的古希腊或许让人欣然向往,但现在希腊的财政困境则让人敬而远之。目前,资本市场要希腊为其预算问题付出沉重代价。     

A Course in Economic Forecasting: Rationale and Content

This note shows that the impact of an increase in product price on factor demand in the typical textbook depiction is overstated to the point of indicating that competitive firms demand factors even when marginal product is negative.     

Espoused drum-buffer-rope flow control in serial lines: A comparative study of simulation models

This paper documents an investigation of drum-buffer-rope (DBR) scheduling and flow control methodology in single-product serial production lines. In particular, DBR flow control is reviewed and the importance of correctly representing this type of flow control mechanism in serial lines is discussed. Departures from valid DBR conceptual and simulation modeling are illustrated. It is shown that the model of a previously published paper is a push system not a DBR system, and that related conclusions regarding protective capacity and constraint location are unsupported. Correct modeling of DBR flow control is shown using discrete simulation experiments that compare the DBR model and a similar push model. Suggestions for additional research are offered.     

Employee involvement and participation: developing the concept of institutional embeddedness using WERS2004

It is widely accepted that employee involvement and participation (EIP) is a key component of the high commitment bundle of HRM, but that it can take a range of forms in practice. Much of the analysis to date has either treated different forms of EIP as a single construct or has measured EIP by virtue of its presence or absence alone. Drawing on earlier work based on the data from WERS1998 examining the link between various forms of EIP and employee outcomes such as job satisfaction and organisational commitment, the authors re-apply and extend these ideas to data from WERS2004. In particular they develop the concept of institutional embeddedness, in order argue that both the depth and breadth of EIP have important associations with commitment though not with satisfaction.

This association held for workplaces employing 25 or more workers, and here it was apparent that the more that employees are involved at workplace level – through a wider number of EIP practices that are held more frequently and include opportunities for workers to have their say – the more likely it is that investments in EIP will reap the reward of organisational commitment. For smaller establishments, given that they tend to operate with relatively few formal schemes, it is likely that managers in these workplaces find alternative ways in which to engage the workforce, and that informal EIP offer similar levels of embeddedness in these situations. A clear implication to be drawn from the findings is that, in a context of lower levels of formality within organisations (large and small), line managers are more than ever the key link between HR policy and the embodiment of actual practice at the workplace.     

Modeling total cholesterol as predictor of mortality: the low-cholesterol paradox

Elevated total cholesterol is well-established as a risk factor for coronary artery disease and cardiovascular mortality. However, less attention is paid to the association between low cholesterol levels and mortality--the low cholesterol paradox. In this paper, restricted cubic splines (RCS) and complex survey methodology are used to show the low-cholesterol paradox is present in the laboratory, examination, and mortality follow-up data from the Third National Health and Nutrition Examination Survey (NHANES III). A series of Cox proportional hazard models, demonstrate that RCS are necessary to incorporate desired covariates while avoiding the use of categorical variables. Valid concerns regarding the accuracy of such predictive models are discussed. The one certain conclusion is that low cholesterol levels are markers for excess mortality, just as are high levels. Restricted cubic splines provide the necessary flexibility to demonstrate the U-shaped relationship between cholesterol and mortality without resorting to binning results. Cox PH models perform well at identifying associations between risk factors and outcomes of interest such as mortality. However, the predictions from such a model may not be as accurate as common statistics suggest and predictive models should be used with caution.     

Two-Period Duopolies with Forward Markets

Review of Industrial Organization - We experimentally consider a dynamic multi-period Cournot duopoly with a simultaneous option to manage financial risk and a real option to delay supply. The...     

Unanticipated money,output, and prices in the small economy

A macroeconomic model for an open economy experiencing both domestic and international monetary disturbances is given. Expectations are assumed to be rational. Particular attention is focused on the reduced form coefficients for unanticipated domestic and foreign monetary disturbances under alternative exchange rate regimes.