The Usefulness of Book-to-Market and ROE Expectations for Explaining UK Stock Returns

Abstract:  The fundamental valuation perspective on stock returns suggests that book-to-market will be positively related to returns if market value of equity equals future expected cash flows discounted at the expected return and book value proxies for future cash flows. Building on this perspective, we develop a log linear model which includes expectations of future BM and ROE in addition to current BM as explanatory variables for future stock returns. We show that these three variables explain a significant part of UK cross-sectional stock returns and that they remain highly statistically significant after including additional risk proxy variables. This supports relevance of fundamental valuation based firm characteristics for explaining stock returns and indicates their potential usefulness for predicting future stock returns.     

Applying cointegration and error correction to measure trade linkages: maize prices in the United States and Mexico

The impact of U.S.‐grown maize on Mexican markets is a subject of heated debate, and is complicated by limited substitution between white and yellow maize as well as regional price differences within Mexico. This article improves on previous analyses using a detailed data set of white maize prices reported weekly in 11 states across Mexico from 1998 through 2005. Using cointegration analysis and the error‐correction model, we find that prices between the United States and Mexico do not share a common long‐run relationship. Within Mexico, prices in Michoacán and Oaxaca are only weakly related with prices in neighboring states, whereas prices in Sinaloa and Jalisco exert considerable influence on prices elsewhere in Mexico. We conclude that, despite North American Free Trade Agreement (NAFTA), white maize prices in Mexico are determined by local conditions including particularly the degree of integration to other regions within Mexico.     

A volume and material handling cost based heuristic for designing cellular manufacturing cells

One of the major problems in a group technology or cellular manufacturing environment is the formation of part groups and machine cells. Because of the combinatorial nature of the cell formation problem, it is difficult to solve the problem optimally. Most of the procedures related to cell design in cellular manufacturing operate on the part-machine incidence matrix in an attempt to identify block diagonality. If complete block diagonality does not exist, the decision about cell configuration is left to the subjective judgement of the designer. These procedures are also generally based on part routing only, and do not consider part volume and material handling costs.In this paper we develop an integer programming model, as well as a heuristic to effectively assign machines to cells. In these procedures we consider component volumes, costs related to movement of components between and within cells, and penalty for not using all machines in a cell visited by a component. Since the integer programming formulation becomes large even for small problems, an efficient heuristic is developed to solve larger problems. The heuristic solutions to 180 randomly generated small problems were compared against the optimal solutions obtained by the integer programming model. The heuristic has been found to identify optimal solutions in all 180 cases.This heuristic is also compared to several well known algorithms on 900 larger test problems. These problems were generated to cover a wide range of environmental situations such as varying levels of block diagonality in the part-machine incidence matrix, and diversity in the component volumes and material handling costs. In 99% of the problems our heuristic generated solutions which are better or as good as the best solution obtained by other algorithms. Further, in situations where complete block diagonality in the part-machine incidence matrix did not exist, our heuristic produced even better results. Since the maximum number of iterations required in our heuristic is the number of machines in the problem, the heuristic is computationally efficient.     

Possible Applications of Survival Analysis in Franchising Research

Time is an important variable for retailers. The concepts of survival and duration, linked to this time variable, can be very interesting in franchising research. For instance, what are the determinants of the survival of a network or a store? Which elements decrease the period before franchising or internationalising a network? There is a well adapted but little-exploited methodology in this research area: survival analysis. Consequently, this methodological paper presents in detail survival analysis methodology before giving relevant examples of applications in the franchising field. Managerial implications of these kinds of research are given before the conclusion.     

Economic burden of thromboembolic and hemorrhagic complications in non-valvular atrial fibrillation in Algeria (the ELRAGFA study)

Abstract

Background: Atrial fibrillation (AF) is the most common cardiac arrhythmia, with substantial public health and economic impact on healthcare systems due to the prevention and management of thromboembolic and hemorrhagic complications. In Algeria, stroke is a leading cause of death, representing 15.6% of all deaths in 2012. Current data on the epidemiology and costs associated with non-valvular AF (NVAF) in Algeria are not available.

Methods: A three-step approach was undertaken to estimate the economic burden of NVAF in Algeria. First, a literature review identified the epidemiological burden of the disease. Second, expert clinicians practicing in Algerian hospitals were surveyed on consumed resources and unit costs of treatment and management of complications and prevention. Finally, these data were combined with event probabilities in an economic model to estimate the annual cost of NVAF prevention and complications for the Algerian healthcare system.

Results: Based on literature and demographics data, it was estimated that there are currently 187,686 subjects with NVAF in Algeria. Seventy per cent of this population was treated for prevention, half of which were controlled. Cost of prevention was estimated at 203 million DZD (€1.5 million) for drugs and 349 million DZD (€2.6 million) for examinations. Mean hospitalization costs for complications ranged between 123,500 and 435,500 DZD (€910–3,209), according to the type and severity of complications. Hospitalization costs for thromboembolic and hemorrhagic complications were estimated at 8,313 million DZD (€62 million), half of which was for untreated patients. Finally, the economic burden of NVAF was estimated at 8,865 million DZD (>€65 million) annually.

Conclusion: The economic burden of NVAF is important in Algeria, largely driven by untreated and INR-uncontrolled patients. There is a lack of information on the Algerian healthcare system that could increase uncertainty around this assessment, but it clearly establishes the importance of NVAF as a public health concern.     

Development and validation of a multidimensional scale measuring free time boredom

A test was developed to assess free time boredom (the FTB scale). FTB components suggested by the literature were utilized to extract indicators, then developed into items. Three preliminary trials were used on separate samples of 109, 152 and 163 persons, to add, delete and modify items. Factor analysis in a final field test (347 subjects) produced four factors, accounting for 45% of the variance. Based upon the resulting factor structure, four subscales were developed and labelled as ‘lack of meaningful involvement’, ‘lack of mental involvement’, ‘slowness of time’ and ‘lack of physical involvement’. Internal consistency coefficients for the subscales ranged from 0.91 to 0.78 while inter-subscale correlations ranged from r = 0.62 to 0.23. The moderate relationships of the FTB scale with the Boredom Proneness Scale and two items on boredom demonstrated acceptable concurrent validity. The FTB scale suggests a concise, valid and reliable test of individuals’ boredom in their free hours, which may be applied to practical settings and research studies. Discussion and limitations are provided.     

Renewable and non-renewable energy consumption,environmental degradation and economic growth in Tunisia

The aim of this document is to investigate the dynamic relationship between economic growth, renewable energy consumption, energy consumption and CO₂ emissions in Tunisia over the period 1990–2015. Unit root tests and co-integration test was used in order to detect the order of stationary and to test the existence long run links between the used variables. We apply the Granger causality test and VECM model to discover the short and long run links between the variables. Results have shown a bidirectional causal relationship between energy use and CO₂ emissions. Economic growth affects CO₂ emission in the short and long run. While there is a unidirectional links running from energy use to economic growth at short run. The paper shares best practices from Tunisia in terms of efficient use of renewable energy policy enablers, which may be contextualized in other emerging economies in order to keep sustainability and to achieve the green economy.     

Agriculture,transportation and the timing of urbanization: Global analysis at the grid cell level

This paper addresses the timing of a location’s historical transition from rural to urban activity. We test whether urbanization occurs sooner in places with higher agricultural potential and comparatively lower transport costs, using worldwide data that divide the earth’s surface at half-degree intervals into 62,290 cells. From an independent estimate of each cell’s rural and urban population history over the last 2,000 years, we identify the date at which each cell achieves various thresholds of urbanization. Controlling for unobserved heterogeneity across countries through fixed effects and using a variety of spatial econometric techniques, we find a robust association between earlier urbanization and agro-climatic suitability for cultivation, having seasonal frosts, better access to the ocean or navigable rivers, and lower elevation. These geographic correlations become smaller in magnitude as urbanization proceeds, and there is some variation in the effects across continents. Aggregating cells into countries, we show that an earlier urbanization date is associated with higher per capita income today.     

Does maternal employment affect child nutrition status? New evidence from Egypt

Even though maternal employment can increase family income, several studies suggest that it could have adverse consequences on children’s health. In this study, we use a nationally representative sample of 12,888 children, aged 0–5 years from Egypt to examine the impact of maternal employment on child nutritional indicators, namely: stunting, wasting, and being underweight and overweight. We adopted various estimation methods to control for observable and unobservable household characteristics in order to identify the causal effect of maternal employment. These different techniques include, propensity score matching (PSM), OLS regression with controlling for a wide range of individual characteristics, and an instrumental variable two-stage least squares (IV 2SLS) approach. Results of the PSM and OLS suggest that maternal employment is weakly associated with having a malnourished child. On the other hand, the IV 2SLS suggests a stronger and significant association between maternal employment and poor nutritional status among children.