MEASURING THE BUSINESS STEALING,CANNIBALIZATION AND MARKET EXPANSION EFFECTS OF ENTRY IN THE U.S. MOTION PICTURE EXHIBITION MARKET*

Using a large and comprehensive theater level database covering over $18 billion in theater revenues over a five year period, I document the extent and nature of business stealing, revenue cannibalization and market expansion that occurred during the height of the 1990's boom in movie theater construction.     

On Freezing Depositor Funds at Financially Distressed Banks: An Experimental Analysis

This article reports an experiment conducted to evaluate the effects of alterations in the terms of repayments to depositors following a liquidity suspension, as well as the effect of alterations in the publicity of information about withdrawal behavior on the fragility of distressed banks. Results indicate that a “tough” renegotiation stance of protecting depositors who maintain their money in the bank, can quite effectively promote stability. Information provided to depositors regarding past withdrawal behavior weakens the effectiveness of a tough renegotiation policy but reduces fragility somewhat for a more lenient rescheduling condition.     

ECONOMIC INCENTIVES AND HOSPITALIZATION IN GERMANY

The dramatically rising health expenditures have become a matter of prime concern. Using a rich panel dataset this paper contributes to this debate by investigating factors determining the demand for hospitalization in Germany. While most previous studies have found a significant impact of social insurance on the demand for hospital trips, the empirical results presented here cast doubts on the role of those economic incentives. There are also important differences in the hospitalization behaviour of men and women, and between the full sample and those with chronic conditions, which have been neglected by the literature. © 1997 John Wiley & Sons, Ltd.     

The Impact of Volatility on Firms Holding Growth Options

“Abuses of real option valuation were partly behind the ramping and subsequent deramping of the 2000 internet techno bubble. No one ever got to eat the free lunch these real option 'theorists' promised. No one ever will; no one ever could.” (Mayor 2001, 53) Growth options contribute to over 95% of the market value of Internet stocks such as Amazon.com, America Online, and eBay. Finance theory often promotes market volatility as being desirable for investors holding financial options. Is volatility also desirable for firms holding growth options? While many argue that it is, this paper presents a simple example illustrating that increasing volatility can destroy growth option value, especially for firms holding “quality” growth options.