Valuation of bankrupt firms

This study compares the market value of firms that reorganizein bankruptcy with estimates of value based on management'spublished cash flow projections. We estimate firm values usingmodels that have been shown in other contexts to generate relativelyprecise estimates of value. We find that these methods generallyyield unbiased estimates of value, but the dispersion of valuationerrors is very wide - the sample ratio of estimated value tomarket value varies from less than 20% to greater than 250%.Cross-sectional analysis indicates that the variation in theseerrors is related to empirical proxies for claimholders' incentivesto overstate or understate the firm's value.     

Life in the pits: competitive market making and inventory control

We use futures transaction data to investigate cross-sectionalrelationships between market-maker inventory positions and tradeactivity. The investigating documents strongly that traderscontrol inventory throughout the trading day. Despite this evidenceof inventory management, typical inventory control models predictthat market-maker reservation prices are negatively influencedby inventory. Surprisingly, our evidence shows, as a strongand consistent empirical regularity, that correlations betweeninventory and reservation prices are positive. We interpretthe evidence as consistent with active position takeing by futuresmarket floor traders.     

Population-dynamics focussed rapid rural mapping and characterisation of the peri-urban interface of Kampala, Uganda

In developing countries, cities are rapidly expanding and urban and peri-urban agriculture (UPA) has an important role in feeding these growing urban populations; however such agriculture also carries public health risks such as zoonotic disease transmission. It is important to assess the role of UPA in food security and public health risks to make evidence-based decisions on policies. Describing and mapping the peri-urban interface (PUI) are the essential first steps for such an assessment. Kampala, the capital city of Uganda is a rapidly expanding city where the PUI has not previously been mapped or properly described. In this paper we provide a spatial representation of the entire PUI of Kampala economic zone and determine the socio-economic factors related with peri-urbanicity using a population-dynamics focussed rapid rural mapping. This fills a technical gap of rapid rural mapping and offers a simple and rapid methodology for describing the PUI which can be applied in any city in developing countries for wide range of studies.     

Testing for deliberate underpricing in the IPO premarket: a stochastic frontier approach

We reevaluate the IPO underpricing phenomenon using the stochasticfrontier methodology. The advantage of the stochastic frontieris that it can be used to measure the level of deliberate underpricingin the premarket without using after-market information. Thisis accomplished through the estimation of a systematic one-sidederror term that measures 'inefficiency' or the difference betweenthe maximum predicted offer price and the actual offer price.Data for the analysis are comprised of 1,035 IPOs of commonstock issued by firm commitment between 1975 and 1984. IPOsappear to be deliberately underpriced in the premarket in bothhot-market and nonhot-market periods. Moreover, the determinantsof the maximum IPO price have different effects in the two timeperiods.