ADAM SMITH: TWO LETTERS TO HENRY BEAUFOY, MP

This article prints two hitherto unknown letters by Adam Smith to Henry Beaufoy (1750-95), MP for Great Yarmouth, concerning legislation that beaufoy and William Pitt had promoted. In the first letter (14 November 1786) Smith comments on changes to existing customs and exicese regulations(26 Geo. III c.49 and c.59), and implicitly takes some credit for legislation concerning the hering fishery (25 Geo. III c.65, 26 Geo. III c.81, 27 Geo. III c.10). In the second letter (29 January 1787) Smith expresses considerable pessimism about the philanthropic proposals of the British Fisheries Society to build fishing villages in the Highlands and Islands of Scotland.     

HOW MANY SMALL FIRMS ARE ENOUGH?

Individual investors are undiversified, holding on average less than four securities in their personal portfolios. The small firm literature focuses on CAPM (systematic risk, full diversification concept) premia, and the actual performance of small firm portfolios held by investors is overstated because of the presence of unsystematic risk. This paper illustrates the magnitudes of total risk for small and large firms, and the behavior of such measures as portfolio size is altered. Small firms contain more risk as shown by the finding that a diversified portfolio of small firms has greater variability than a single, typical large firm. While small firms outperform large firms, investors should be aware of the implications for small firm undiversified portfolios. Because small firms contain large amounts of unsystematic risk, diversification is important if investors are going to capture the small firm premia reported in the literature.     

The strengths and weaknesses of the picketing law

In 1972, three national strikes received a wide coverage on television, radio and in the press. They were the miners' dispute, followed by the docks' industry dispute, and finally the national building industry strike. While much attention was directed to the respective claims which were lodged, a further aspect arising out of those strikes provoked a great deal of controversy. This related to the unlawful behaviour of a number of pickets who had taken up their stances outside various industrial establishments. It appears that at some locations, clashes had taken place between police and pickets, resulting in the arrest and charging of a substantial number of workmen. Figures show that at least 263 pickets were arrested in England and Wales during the course of the miners' strike.