Investor behaviour and reaching for yield: Evidence from the sterling corporate bond market

We provide evidence on how corporate bond investors react to a change in yields, and how this behaviour differs in times of market‐wide stress. We also investigate ‘reaching for yield’ across investor types, as well as providing insights into the structure of the corporate bond market. Using proprietary sterling corporate bond transaction data, we show that insurance companies, hedge funds and asset managers are typically net buyers when corporate bond yields rise. Dealer banks clear the market by being net sellers. However, we find evidence for this behaviour reversing in times of stress for some investors. During the 2013 ‘taper tantrum’, asset managers were net sellers of corporate bonds in response to a sharp rise in yields, potentially amplifying price changes. At the same time, dealer banks were net buyers. Finally, we provide evidence that insurers, hedge funds and asset managers tilt their portfolios towards higher risk bonds, consistent with ‘reaching for yield’ behaviour.     

Can investors time their exposure to private equity?

Private equity performance, both for buyouts and venture capital, has been highly cyclical: periods of high fundraising have been followed by periods of low performance. Despite this seemingly predictable variation, we find modest gains, at best, to pursuing realistic, investable strategies that time capital commitments to private equity. This occurs, in part, because investors can only time their commitments to funds; they cannot time when commitments are called or when investments are exited. There is a high degree of time-series correlation in net cash flows even across commitment strategies that allocate capital in a very different manner over time.     

A model of wage and employment effects of service offshoring

This paper develops a two‐sector model of trade in goods and intermediate tasks that differ in tradability and skill intensity. A skill‐abundant country with high productivity is shown to offshore more unskilled tasks than skilled tasks, without relying on a particular correlation structure between tradability and skill intensity. With putty‐clay technology that allows retraining in the long run, transition from the non‐offshoring to the offshoring equilibrium generates wage and employment effects that switch from negative to positive as tradability declines, with the switches occurring at a higher degree of tradability for skilled tasks. This is consistent with the empirical literature.     

Lobbying as a potent political marketing tool for firm performance: A closer look

This study endeavors to enhance political marketing literature about the impact of lobbying on firm performance. Our sample is composed of 140 U.S. firms and spans the years 2007–2014 to encompass the 2007–2009 recession and the subsequent recovery period. Our findings indicate that lobbying expenses positively contribute to firm performance. Also, government contracts in both ways, dollar amount and number of government contracts, act as mediators between lobbying expenses and firm performance. In addition, organizational slack moderates the relationship between lobbying expenses and government contracts. The managerial implications suggest that lobbying expenses can be leveraged as a potent tool for firm performance. Firms with larger lobbying efforts acquired both, higher dollar amounts and a greater number of government contracts.     

Perceptions of the benefits of the A3 planner in facilitating project-based learning in accounting education

This paper evaluates ways of instilling project management skills into accounting-based learning by the use of an iterative A3 planner to plan, monitor and review assignment progress. The application of an A3 planner to facilitate a project-based learning (PBL) group assignment in undergraduate accounting education has been critically evaluated in terms of both the student and tutor experience. The study uses a mix of qualitative and quantitative data. Quantitative data assisting exploration of perceptions were collected through 100 undergraduate students. A series of focus group discussions were carried out to investigate students’ engagement and tutors’ teaching experiences regarding the adoption of the A3 planner. The results suggest that the A3 planner promotes active planning and effective management of a PBL group assignment. It makes students’ thought processes more visible thereby facilitating and enhancing the tutoring/mentoring process. Moreover a more interactive and transparent approach by doing assignment via the use of an iterative A3 planner has ensured more feedback points and action based efficiency in the doing approach for learners.     

Class structure and inequality during the industrial revolution: lessons from England's social tables, 1688–1867

This article measures the size and incomes of six major social classes across the industrial revolution using social tables for England and Wales in 1688, 1759, 1798, 1846, and 1867. Lindert and Williamson famously revised these tables, and this article extends their work in three directions. First, servants are removed from middle‐ and upper‐class households in the tables of King, Massie, and Colquhoun and tallied separately. Second, estimates are made for the same tables of the number and incomes of women and children employed in the various occupations, and, third, incomes are broken down into rents, profits, and employment income. These extensions to the tables allow variables to be computed that can be checked against independent estimates as a validation exercise. The tables are retabulated in a standardized set of six social groups to highlight the changing structure of society across the industrial revolution. Gini coefficients are computed from the social tables to measure inequality. These measures confirm that Britain traversed a ‘Kuznets curve’ in this period. Changes in overall inequality are related to the changing fortunes of the major social classes.     

Real Exchange Rate Misalignments in the Euro Area

Open Economies Review - Building upon a Behavioural Equilibrium Exchange Rate model, estimated at a quarterly frequency since 1999 on a broad sample of 57 countries, this paper assesses both the...