Contingent payments in selection contests

The early literature on research contests stressed the advantages of a fixed prize in inspiring R&D effort. More recently the focus has moved towards endogenizing the rewards to research activity in these tournament settings, since this can induce extra effort or enhance the surplus of the buyer. We focus on a research contest as a means of selecting a partner for an R&D enterprise, in an informational setting in which the established providers of R&D services know more about each others’ relative capabilities than does the buyer/sponsor. An alternative use of our model is in choosing between prospective patentees where the Patent Trading Office has less information on the patents than the competitors. This asymmetry creates a source of inefficiency if a rank order contest is used as a selection device; we show how the contest can be modified to improve selection efficiency, while maintaining its simplicity (as only ordinal information is required). The modification that we suggest involves endogenizing the prizes that are awarded contingent upon whether a contestant wins or loses the contest. Furthermore, the payment system and the selection mechanism are detail-free. This paper is part of the project “The Knowledge-Based Society” sponsored by the Research Council of Norway (project 172603/V10).     

Gender differences within early stage and established small enterprises: An exploratory study

This paper examines 2 years of data from GEM Canada in order to develop new insights into the factors that contribute to the performance outcomes of female enterprises and how these factors are affected by the firm’s stage of development. The analysis encompasses both personal and organizational characteristics and assesses their association with selected performance measures at the early stage as well as at the established phase of development. The findings indicate that the greater propensity of men to pursue business growth and earnings can be attributed to marital status (live with a partner) and the expected depth of the ownership team. Moreover, the performance outcomes for male entrepreneurs are influenced by a relatively wide range of variables, with business demographics being more prominent than for the female enterprises. For both genders, the mix of relevant underlying factors varies as the venture progresses along the ‘nascent-new-established’ continuum.     

Econometric analysis of linearized singular dynamic stochastic general equilibrium models

In this paper I propose an alternative to calibration of linearized singular dynamic stochastic general equilibrium models. Given an a-theoretical econometric model as a representative of the data generating process, I will construct an information measure which compares the conditional distribution of the econometric model variables with the corresponding singular conditional distribution of the theoretical model variables. The singularity problem will be solved by using convolutions of both distributions with a non-singular distribution. This information measure will then be maximized to the deep parameters of the theoretical model, which links these parameters to the parameters of the econometric model and provides an alternative to calibration. This approach will be illustrated by an application to a linearized version of the stochastic growth model of King, Plosser and Rebelo.     

Natural conjugate priors for the instrumental variables regression model applied to the Angrist–Krueger data

We propose a natural conjugate prior for the instrumental variables regression model. The prior is a natural conjugate one since the marginal prior and posterior of the structural parameter have the same functional expressions which directly reveal the update from prior to posterior. The Jeffreys prior results from a specific setting of the prior parameters and results in a marginal posterior of the structural parameter that has an identical functional form as the sampling density of the limited information maximum likelihood estimator. We construct informative priors for the Angrist–Krueger [1991. Does compulsory school attendance affect schooling and earnings? Quarterly Journal of Economics 106, 979–1014] data and show that the marginal posterior of the return on education in the US coincides with the marginal posterior from the Southern region when we use the Jeffreys prior. This result occurs since the instruments are the strongest in the Southern region and the posterior using the Jeffreys prior, identical to maximum likelihood, focusses on the strongest available instruments. We construct informative priors for the other regions that make their posteriors of the return on education similar to that of the US and the Southern region. These priors show the amount of prior information needed to obtain comparable results for all regions.     

Measuring volatility with the realized range

Realized variance, being the summation of squared intra-day returns, has quickly gained popularity as a measure of daily volatility. Following Parkinson [1980. The extreme value method for estimating the variance of the rate of return. Journal of Business 53, 61–65] we replace each squared intra-day return by the high–low range for that period to create a novel and more efficient estimator called the realized range. In addition, we suggest a bias-correction procedure to account for the effects of microstructure frictions based upon scaling the realized range with the average level of the daily range. Simulation experiments demonstrate that for plausible levels of non-trading and bid–ask bounce the realized range has a lower mean-squared error than the realized variance, including variants thereof that are robust to microstructure noise. Empirical analysis of the S&P500 index-futures and the S&P100 constituents confirms the potential of the realized range.     

Econometric analysis of copyrights

This paper explores the impact of copyrights on firm value and on the demand for firm output. Using panel data on franchise value and ticket sales from the National Football League over the 1991–2000 period, we analyze the effect of copyrights (in this case, team logos) using several parametric estimators, the Arellano and Bond [1991. Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies 58, 277–297] dynamic panel data estimator, and a semi-non-parametric method based on difference-in-differences propensity score matching. We find a negative effect of logo changes on franchise value that is robust across multiple specifications. In addition, logo changes also appear to have a moderate positive, albeit not particularly robust, impact on ticket sales.     

Health state utilities associated with caring for an individual with cutaneous T-cell lymphoma (CTCL)

Abstract

Aim

Cutaneous T-cell Lymphoma (CTCL) is a rare form of non-Hodgkin lymphoma characterized by skin lesions, which can negatively impact the quality of life of both patients and their caregivers. The Decision Support Unit (DSU) at the National Institute for Health and Care Excellence (NICE) in the UK recently outlined a rationale for the inclusion of caregiver burden in economic evaluations. This study aimed to estimate utilities for health states associated with being a caregiver for an individual with CTCL at different stages of treatment.