Policy Framework for Transition to a Low-Carbon World Economy

Climate change mitigation policy is the most difficult to come before our polity in living memory. There can be no solution without international agreement involving all substantial economies, and yet each country has an incentive to free ride on others. The international agreement must have five parts: agreement on the objective in terms of concentrations of greenhouse gases in the atmosphere, agreement on allocation of an emissions entitlements budget among countries, agreement on rules for international trade in entitlements, agreement on developed countries taking the lead on development of low-emissions technologies, and agreement on assistance from developed countries for climate change mitigation in developing countries. Two sources of market failure must be corrected to achieve emissions reduction targets efficiently: the external costs of emitting greenhouse gases and the external benefits of private investment in innovation in relation to low-emissions technologies.     

Analyse 1-800-GOT-JUNK——Low Carbon Recycle Business

People today are too busy. They hardly even have time to keep life clean. But 1-800-GOT-JUNK？ saves time for them. That is why the 1-800-GOT-JUNK？ franchise rose to such popularity. The 1-800-GOT-JUNK franchise is a great business opportunity for those who have skill and experience in cleaning and recycling, as＂leaning homes amounts to a $4 billion per year industry in the US＂. Despite its name, this cleaning business now reaches well beyond junk removal, and 1-800-GOT-JUNK？ has already grown into a true business. Therefore, junk removal become a modem industry.     

低碳经济发展的金融支持问题研究

为减少污染和温室气体排放以应对全球气候变暖,国际社会积极主张经济转型大力发展低碳经济。但低碳经济相对于传统经济增长方式而言,在新的技术、新的制度安排中,需要更高的资金投入,这就需要构建创新型金融支持体系,有效解决低碳经济发展中的资金瓶颈,实现经济社会可持续发展。     

Machine over Mind? Stock price clustering in the era of algorithmic trading

Given the rise of automated trading in the post-decimalization era, we examine time trends in price clustering for exchange traded funds (ETFs) and individual stocks during the post decimalization era. There is limited prior evidence on price clustering for portfolio securities such as ETFs. A striking feature of the evidence is the substantial reduction in clustering over the sample period for ETFs as well as for individual stocks. This decline occurs for trades of all sizes. We attribute the decline in clustering to the increasing prominence of algorithmic trading, which is immune to psychological biases.     

Truthful multi-unit multi-attribute double auctions for perishable supply chain trading

This paper aims to propose multi-attribute double auctions for perishable supply chain trading (PSCT). We first construct a multi-unit/single-unit multi-attribute double auction (MS-MDA) for PSCT where suppliers can submit bids on a single unit of one item (i.e., single output restriction). We then relax the single output restriction and propose a multi-unit multi-attribute double auction (M-MDA) for PSCT in which each supplier offers multiple units of one item. Both the MS-MDA and M-MDA mechanisms are incentive compatible, individually rational, budget balanced and computationally efficient. The computational study shows that all proposed mechanisms are of high allocation efficiency and practically implementable.     

Predatory trading,Stigma and the Fed׳s Term Auction Facility

Predatory trading may affect the incentives for banks to raise liquidity in times of financial distress. In these periods, borrowing becomes a signal of illiquidity, exposing borrowers to predatory trading and possible insolvency. A stigma of borrowing thus arises, leading distressed banks to take on more illiquid positions than they would otherwise. The Fed׳s Term Auction Facility (TAF) can alleviate this problem. The TAF׳s competitive auction format allows auction winners to signal that they are illiquid but relatively strong. The TAF may therefore be an effective policy tool during financial crises: by altering the signal value of borrowing, this facility supports the injection of liquidity into distressed banks. In normal times, however, this auction facility becomes counterproductive: by cream-skimming the relatively strong banks, the weakest banks are left as potential prey for predators. This suggests that the TAF is a policy best reserved for times of crisis.     

Information of Unusual Trading Volume

This article investigates the information content of stock unusual trading volume from the aspect of firm fundamental information revealed by both earnings formal announcements and preannouncements. By using the stock market data of China from the second quarter of 2003 to the end of 2015, this article provides evidence that, in general, stocks that experience unusually low trading volume over the week prior to earnings announcements have more unfavorable earnings surprises. However, because of the feature of mandatory pre-disclosure policy in China, this article further finds that the relation between unusually low trading volume and unfavorable earnings surprises only exists in the stocks without earnings preannouncements, because fundamental information is incorporated in the stock prices timely around preannouncements date. In addition, unusually low trading volume signals negative fundamental changes revealed by preannouncements, and this effect is more pronounced among stocks with higher short-selling constraints, but unusually high trading volume is value-irrelevant.     

Price impact and bursts in liquidity provision

This paper analyses brief episodes of high-intensity quote turnover and revision—‘bursts’ in quotes—in the US equity market. Such events occur very frequently, several hundred times a day for actively traded stocks. We find significant price impact associated with these market maker initiated events, about five times higher than during non-burst periods. Bursts in quotes are concurrent with short-lived structural breaks in the informational relationship between market makers and market takers. During bursts, market makers no longer passively impound information from order flow into quotes—a departure from the traditional market microstructure paradigm. Rather, market makers significantly impact prices during bursts in quotes. Further analysis shows that there is asymmetry in adverse selection between the bid and ask sides of the limit order book and only a sub-population of market makers enjoys an informational advantage during bursts. Market makers on the side opposite the burst suffer elevated adverse selection costs, while market makers on the side of the burst realize positive spread, irrespective of the order flow direction. Our results call attention to the need for a new microstructure perspective in understanding modern high-frequency limit order book markets and the quote manipulation strategies at the disposal of the fast market makers.     

Contractual restrictions on insider trading: a welfare analysis

Summary. This paper analyzes the welfare effects of permitting firms to negotiate contractually the right to allow corporate insiders to trade shares in the firm on private information. A computational framework is employed to (i) analyze formally the effects of insider trading on managerial investment choice, the informational efficiency of stock prices, and the welfare of all investor types; and (ii) examine the effectiveness of various compensation schemes (such as stock and insider trading rights) to mitigate conflicts of interest between managers and shareholders. I show that shareholders will typically choose not to grant insider trading rights to managers. This decision is socially optimal. Received: September 23, 2000; revised version: December 12, 2000