Using Experimental and Neurological Data to Gain a Deeper Understanding of Realization Utility Theory

Starting with the premise that realization utility theory helps explain trading behavior, this study combines a carefully crafted experimental design with functional magnetic resonance imaging technology to offer a more inclusive examination of factors that affect REIT trading behavior beyond whether a REIT is simply trading up or down. We add to the nascent field of neurological real estate by finding that local gains/loss domains are more relevant than are global gain/loss considerations, financial skewness is a significant determinant of trading behavior, and that performance inside the REIT market influences how hard subjects think when performing tasks outside the market.     

Effective Rates of Sectoral Productivity Change

In effective rates of sectoral productivity change, some of the inputs are treated as produced. Here, this is extended to cover all the inputs. All the sectoral rates of productivity growth based on a static input–output (IO) framework are shown to be equal to the corresponding rates of decrease in the production price. For the direct rate, all the input prices are treated as exogenous constants. For the effective rates, prices of the inputs, which are treated as produced, are determined by production technology. The fully effective rate is derived from the price equations of the closed dynamic IO model. It is equal to the rate of decrease in the production price when the prices of all inputs, human capital and human time included, depend on production technology. The overall rate, obtained as a weighted sum of the fully effective sectoral rates, is equal to the rate of growth in the growth potential of the economy.     

Hedging labor income risk

We use a detailed panel data set of Swedish households to investigate the relation between their labor income risk and financial investment decisions. In particular, we relate changes in wage volatility to changes in the portfolio holdings for households that switched industries between 1999 and 2002. We find that households do adjust their portfolio holdings when switching jobs, which is consistent with the idea that households hedge their human capital risk in the stock market. The results are statistically and economically significant. A household going from an industry with low wage volatility to one with high volatility ceteris paribus decreases its portfolio share of risky assets by up to 35%, or $15,575.     

Sustainability perspectives on Oulanka National Park,Finland: mixed methods in tourism research

This paper positions mixed methods as a complement to traditional qualitative and quantitative research. It provides an example of conducting mixed methods research by analysing the sociocultural sustainability of tourism as perceived by local stakeholders nearby Oulanka National Park in north-eastern Finland. Semi-structured interviews were linked concurrently to survey data from the same respondents. First, four discourses were identified based on 40 interviews with respondents about tourism development pertinent to the Protected Area Network (PAN) Parks international certification. Second, the differences between the representatives of the discourses were examined using non-parametric statistics. Results of the qualitative and quantitative analysis supplemented each other. The survey results supported the identification of four discourses and provided information about the representatives using the discourses. The discourse groups differed according to length of residence in the area, distance from the park, gender, employment in tourism, familiarity with PAN Parks, benefit from PAN Parks status, belief in the benefits of PAN Parks, satisfaction with tourism and park development, importance of the environmental dimension and satisfaction with various dimensions of sustainability. The study demonstrates that a better understanding of a problem may be acquired by using a mix of survey methods and interviews.     

Pricing and Capital Allocation for Multiline Insurance Firms

We study multiline insurance companies with limited liability. Insurance premiums are determined by no‐arbitrage principles. The results are developed under the realistic assumption that the losses created by insurer default are allocated among policyholders following an ex post, pro rata, sharing rule. In general, the ratio of default costs to expected claims, and thus the ratio of premiums to expected claims, vary across insurance lines. Moreover, capital and related costs are allocated across lines in proportion to each line's share of a digital default option on the insurer. Our results expand and generalize those derived elsewhere in the literature.     

The SNA93 Values as a Consistent Framework for Productivity Measurement: Unsolved Issues

The SNA93 as a source of a consistent set of values for productivity accounting is studied. In the valuation of intermediate inputs and outputs the main problems relate to the treatment of taxes and subsidies on products. In labor share the main problem is the separation of the labor compensation of the self-employed. As to the value of capital input, the exact relationship between depreciation, efficiency decline and obsolescence is missing in the SNA93. All relevant assets are not allocated to industries. Treatment of the services of financial intermediaries is also problematic     

Asset pricing in large information networks

We study asset pricing in economies with large information networks. We focus on networks that are sparse and have power law degree distributions, in line with empirical studies of large scale social networks. Our theoretical framework yields a rich set of novel asset pricing implications. We derive closed form expressions for price, volatility, profitability and trading volume, as functions of the network topology. We also study agent welfare and show that the network that optimizes total welfare is typically a uniform one with an intermediate degree of connectedness.