Forms of Foreign Investment Liberalization and Risk in Emerging Stock Markets

I examine the effect of different forms of foreign investment liberalization on risk in emerging equity markets, including international cross-listings and closed-end country funds, and in the domestic equity market as foreign investment restrictions are eliminated. I find that in Latin American markets volatility declines significantly with different forms of foreign investment liberalization, and in Asian markets volatility does not increase significantly. Volatility is driven by domestic factors in South America, but the transmission of volatility from the United States to Mexico increases after liberalization. The market risk exposure increases in Argentina after liberalization, in Chile with an index of American Depositary Receipts, and in Thailand with greater foreign ownership, reducing the diversification benefits of these markets.     

THE EFFECT OF INVESTMENT IN INTERORGANIZATIONAL INFORMATION TECHNOLOGY IN A RETAIL SUPPLY CHAIN

The primary purpose of this research was to investigate the effect of investment in information technology in a supply chain. The results of that investigation are presented by focusing on an empirically tested supply chain relationship model containing both behavioral and operational constructs. The four behavioral constructs represented in the model are relationship trust, relationship commitment, relationship dependence, and long‐term relationship orientation. The four operational constructs represented in the model are retailer investment in interorganizational information technology, perceived supplier investment in interorganizational information technology, logistics efficiency, and logistics effectiveness. Among other findings, the results of the investigation found that perceived supplier investment in interorganizational information technology has a significant and positive effect on logistics efficiency.     

Household formation by the young in the United States

"A model of household formation by the young is specified and estimated. It was found that the headship rate for the young in the United States depends on income, the cost of housing, the number of families receiving AFDC payments, the age at first marriage for females and for males, and the percentage of males enrolled in college. Household formation by the young is much more sensitive to changes in income and the price of housing than household formation by the entire adult population. The estimated results are used to examine the change in the headship rate from 1961 to 1979 and from 1979 to 1987."     

Developing a tutoring module for presentation of computerized patient management problems

The simulation problem is one of the most commonly used formats in computer-assisted instruction (CAI). In medical education, a patient simulation problem is known as a patient management problem (PMP). A number of computerized PMP systems are currently available. However, to date, there is no record of PMP systems having been developed using artificial intelligence. This is noteworthy since artificial intelligence techniques could help in the generation of more effective and intelligent instructional systems.

This paper analyzes and evaluates existing instructional simulation software in clinical medicine in terms of effective educational design attributes. Components of effective PMP systems thus identified are incorporated into a computerized instructional system which uses artificial intelligence techniques for teaching problem-solving and diagnostic skills to undergraduate medical students.     

Revisiting managerial perspectives on dividend policy

We survey managers of Nasdaq firms that consistently pay cash dividends to determine their views about dividend policy, the relationship between dividend policy and value, and four common explanations for paying dividends. The evidence shows that managers stress the importance of maintaining dividend continuity and widely agree that changes in dividends affect firm value. Managers give the strongest support to a signaling explanation for paying dividends, weak to little support for the tax-preference and agency cost explanations, and no support to the bird-in-the-hand explanation. The study provides new evidence about how managers view dividend life cycles and residual dividend policy. The authors would like to thank two anonymous referees for helpful comments and suggestions, and Maheshan Fernando and Sumeet Chawla for providing research assistance.     

In search of a residual dividend policy

We survey 309 sample firms exhibiting behavior consistent with a residual dividend policy and their matched counterparts to learn how they set their dividend policies. The findings reveal that the sample firms are more likely than their counterparts to maintain a long-term dividend payout ratio, use long-run earnings forecasts in setting the dividend, and be unconcerned about the cost of raising external funds. Yet, firms behaving as though they follow a residual dividend policy generally do not profess to follow the policy. At best, the sample firms follow a “modified” residual policy in which they carefully manage their payout ratio and dividend trend. Although it may not be an explicit goal of such a dividend policy, consistently low free cash flow typically results.     

Establishing statistical foundations of a chronology for the great divergence: a survey and critique of the primary sources for the construction of relative wage levels for Ming–Qing China

This article is a survey and critique of recent endeavours to establish statistical foundations for a chronology for the great divergence based upon trends and levels in relative wages. Our reading of the bibliography in Chinese labour history, together with a preliminary investigation into other primary sources, suggests that the Kuznetsian paradigm for empirical economics may not be viable for the construction of analytical narratives for the Chinese and other premodern imperial economies in South and West Asia. Nevertheless, two datasets currently in print will continue to be quoted to lend support to numerically grounded speculations for levels and trends in real wages and welfare for the families of wage‐dependent urban workers in China over the eighteenth century. Statistical evidence for the Ming and Qing dynasties calibrated for the purposes of comparing real wage levels for wage‐dependent labour between China and western Europe can, however, be placed on a spectrum for accuracy and inferential analysis that runs from ‘unfounded guess work’ to ‘plausible conjectures’. The unwelcome contention of this article is that the data published and potentially available for China (and probably for India and the Ottoman Empire) stand close to the unfounded guess work end of that spectrum. Meanwhile, and as a speculative conclusion, we offer a conjecture that the ‘real wages’ for Qing China's tiny proletariat, whose income included high proportions of wages in kind, have remained as elusive as they were when the real wage debate began a decade ago.     

An Experimental Analysis of Modifications to the Centralized Milk Quota Exchange System in Quebec

Using experimental economics, this paper tests the potential impacts of modifying the centralized quota exchange system in Quebec with the intent of decreasing the quota price while minimizing negative impacts on auction effectiveness. Two separate treatments are applied to a uniform price auction similar to that employed in Quebec. The first treatment is an exclusion (5% or 15%) of the highest buyer bids and seller offers. The second is a tax (2% or 10%) on all units offered for sale that remain unsold. Various combinations of the two treatments are also tested. The results suggest that exclusion of the highest bids and offers can decrease the price of the quota and that a 15% exclusion rate is more effective than a 5% rate. The tax alone has little impact on quota price. The combination of the two treatments generates a more marked reduction in both the number of exchanges and the price of the quota than when the tax or the exclusion is applied individually. However, the combination of treatments results in a greater loss of economic efficiency. In all cases, relatively small market price reductions are realized at the expense of substantial losses in economic efficiency. La présente étude teste de manière expérimentale la capacité d'une modification au système centralisé de vente du quota à faire diminuer le prix du quota laitier au Québec tout en minimisant les impacts négatifs des changements sur l'efficacité de l'enchère. Cette modification consiste à appliquer deux traitements sur l'enchère de prix uniforme où s'échange le quota. Le premier traitement consiste en une exclusion (5% ou 15%) des mises les plus élevées des acheteurs et des vendeurs. Le second traitement est une taxe (2% ou 10%) appliquée aux unités que les vendeurs mettent en marché et ne réussissent pas à vendre. Différentes combinaisons de ces deux traitements sont également testées. Les données générées permettent de conclure que le mécanisme d'exclusion des mises les plus élevées permet de faire diminuer le prix du quota, l'exclusion de 15%étant plus efficace que celle de 5%. Pour sa part, la taxe seule a peu d'impact sur le prix du quota tandis que la combinaison des deux traitements entraîne une diminution du nombre de transactions et du prix du quota plus marquée que lorsque les traitements de taxe et d'exclusion sont appliqués individuellement. Cela a comme corollaire d'entraîner une perte d'efficacitééconomique plus importante. Dans tous les cas, des baisses de prix de marché relativement modestes sont réalisées au coût d'importantes pertes d'efficacitééconomique.     

Effects of Consumers’ Efforts on Price and Promotion Fairness Perceptions

This research examines how consumers’ efforts as a nonmonetary sacrifice influence their price and promotion fairness perceptions in the context of price promotions. Multiple studies using different price promotion tactics demonstrate that consumers’ perceived level of effort to obtain a reduced price negatively influences their fairness perceptions when they deny the promoted price. Exploring the underlying mechanisms of this effect, we show that the amount of effort consumers exert to obtain a promoted price leads to their feeling of deservingness and entitlement. When the promoted price is denied, this feeling of entitlement is violated, causing unfairness perceptions to occur. The research demonstrates that, in addition to retailers’ actions such as price changes, consumers’ actions, in the form of their effort input, are also an important determinant of fairness perceptions.     

The Impact of Company Pre-Listing Attributes on the Market Reaction to NYSE Listings

This study examines the market behavior of common stocks transferring from the NASDAQ stock market to the New York Stock Exchange from 1982 to 1989. Using event study methodology, the study tests the joint liquidity-signaling hypothesis that a stock's pre-listing liquidity and earnings per share (EPS) growth (a proxy for signaling) affect the market behavior around NYSE listings. The results show that the market responds more favorably to stocks with low liquidity and high signaling than to stocks with high liquidity and low signaling before listing. Stocks in the former group do not have an anomalous pattern of negative post-listing abnormal returns.