The Economics of Private Business Jet Travel

The use of private air travel for business trips has expanded rapidly over the past few decades. We estimate that the number of U.S. domestic passenger trips per year on business aircraft exceeded 17 million in 2007, or a number equal to about 40 percent of combined domestic first-class, business-class, and full-fare coach airline trips—travel options for which passengers also pay a premium for timeliness, comfort, or privacy. Once a company determines that it can benefit from private business travel, it generally identifies the most cost-effective option, including the operating characteristics of the aircraft and the options for obtaining this service. This paper examines some of the factors that influence decisions on these options, with particular emphasis on the financial and program alternatives that are making it less costly for business travelers to take advantage of private jet travel, thereby expanding its use. Our findings indicate that the customary view of these options is oversimplified and ignores the new ownership (or non-ownership) models for obtaining use of a business aircraft.     

Understanding complaining responses through consumers' self‐consciousness disposition

The objective of this article is to determine whether a dissatisfied consumer would select a specific complaining behavior response based on his or her self‐consciousness disposition. The study used written scenarios where subjects waiting in line at a movie theater had to face additional waiting time as a consequence of an event associated with an intruder or with the service provider, and occurring either immediately in front of them or further away. Results indicated that, when faced with an additional delay related to an event occurring near them as opposed to further away from them, high private subjects, in contrast with low private subjects, had a significantly more negative perception of service quality and a strong tendency to display more negative word‐of‐mouth behavior. When faced with an additional delay related to an event occurring near them as opposed to further away from them, high public subjects, in contrast with low public subjects, had a significantly more negative perception of service quality and favored significantly more negative word‐of‐mouth behavior to express their dissatisfaction. Under a direct intrusion scenario, when compared with low public subjects, high public subjects favored significantly more negative word‐of‐mouth behavior and evaluated service quality in a significantly more negative way than when the loss of time was related to actions of the service provider. © 2002 Wiley Periodicals, Inc.     

Change Point Analysis based on Empirical Characteristic Functions

Test procedures for detection of a change in the distribution of a sequence of independent observations based on empirical characteristic functions are developed and their limit properties are studied. Theoretical results are accompanied by a simulation study.The work of the first author was partially supported by grants GAČR 201/03/0945 and MSM 113200008     

SECURITIZATION: A LOW-COST SWEETENER FOR LEMONS

Since the launching of the mortgage backed market in the early 1970s, securitization has experienced extraordinary growth and spread to a remarkable variety of receivables. But financial economists in the tradition of Miller and Modigliani have been hard pressed to explain such growth. When viewed within the context of an M & M world of “perfect markets,” securitization appears to be simply another way—and a highly complex and costly one, at that—for a company to carve up its operating cash flows and repackage them for investors. This article seeks to explain the growth of securitization by identifying reductions in costs that M & M assume out of existence. For some types of companies, the largest sources of the cost savings are fairly obvious. Most mortgage securitizations are effectively subsidized by the U.S. government, which contributed greatly to the launching of the securitization movement. And commercial banks forced to meet regulatory capital requirements have found securitization of loans to be a low-cost compliance strategy. But securitization appears to offer more than regulatory benefits. For example, higher rated companies with a variety of financing options appear to use securitization to diversify their funding sources and arbitrage small price differences in financial markets. But if such arbitrage profits can be significant, the non-regulatory benefits appear to be largest for companies with few financing alternatives—those firms that face what economists refer to as a “lemons problem.” Available information about such companies is often limited (as in the case of smaller companies), unfavorable (companies in financial distress), or particularly difficult to appraise (companies in volatile industries, or facing unstable political environments or potentially large liabilities). Especially in the case of such “lemons” companies, securitization may reduce overall financing costs by carving up the evaluation of a company's securities into tasks amenable to greater specialization. In so doing, it may reduce aggregate information costs for all its securities and thus increase total value.     

The stability of the demand for money: The case of the corporate sector

Although there is general consensus on the determinants of the demand for money, the empirical performance of such money-demand equations has been unstable and poor in forecasting. In this study, the demand for money is empirically investigated on a disaggregated basis, by major sector, using Flow of Funds data, 1955i–1976iv. The results indicate that the empirical difficulties are specific to the corporate sector, that the problems in the corporate sector emerged during the later 1960s, and that foreign economic activity has become an important component in explaining holdings of cash by the corporate sector.     

Comparisons and Contrasts Between Elementary/Primary ’School Situated Design’ and ’Workplace Design’ in Canada and England

There is a lack of evidence that examines, together, the triad of how teachers in elementary/primary schools are translating curriculum requirements for teaching design, within technology frameworks, in their classrooms, how their students then proceed with design, and how ’school situated design’ relates to ’workplace design’. This paper explores the relationships between designerly thinking and behaviours situated in classrooms and in the workplace, beliefs about how designing is learned in schools and in the ’real world’, and children’s, teachers’ and designers’ understanding of design. These are be illustrated by extracts from interviews with teachers, children and designers and evidence of designing in classrooms and in the workplace. Similarities and differences between evidence from ’school situated design’ and ’workplace design’ and from Canada and the United Kingdom (UK) are discussed. This revised version was published online in July 2006 with corrections to the Cover Date.