ADVERSE SELECTION IN ELECTRONIC MARKETS: EVIDENCE FROM ONLINE STAMP AUCTIONS

We analyze adverse selection costs in online stamp auctions, based on a comparison of prices on eBay with those of matched stamps at a specialty stamps auction site in the U.S., Michael Rogers, Inc. (MR), which we know a priori has low quality uncertainty. We find that buyer prices are 10–15% lower on eBay as compared to MR, and the price difference, increases with the value of the stamps. Consistent with this adverse selection discount we find that the seller reputation mechanism on eBay has an economically modest, although statistically significant, effect on auction price and probability of sale.     

Corporate ownership concentration and audit fees: The case of an emerging economy

The paper investigates the effects of corporate ownership concentration on audit fees in emerging economies, using Bangladesh as a case. Prior studies have indicated that audit fees in Bangladesh are significantly low. Also, the Bangladeshi private sector is dominated by high ownership concentration. Agency theory predicts that in an efficient market, managers in a highly concentrated ownership situation will have sufficient incentives to have more rigorous audits performed. However, managers in emerging economies, where the markets are not as strong, may not have similar incentives. We test whether audit fees in Bangladesh are related to corporate ownership concentration. Our results indicate that audit fees have a significant negative relationship with sponsor and institutional ownership concentrations. This indicates that in Bangladesh, companies actually pay lower audit fees when these are dominated by sponsor and institutional shareholders. For the public shareholders, we find a negative, but statistically insignificant relationship. The results seem to suggest that corporate ownership pattern may be a major factor in explaining the low audit fees in Bangladesh.     

Farmers’ motivations,risk perceptions and risk management strategies in a developing economy: Bangladesh experience

Aquaculture farmers’ risk perceptions and risk management strategies have still received little attention in agricultural research. Therefore, an exploratory study has been undertaken to provide empirical insight into Bangladeshi coastal shrimp farmers’ risk perceptions and risk management responses. Data from our study show that 95% of farmers have no formal training in shrimp aquaculture. Shrimp farmers’ cooperative societies operate in only 13.3% of the studied areas and only 15% of shrimp farmers are involved with these cooperative societies. The results reveal that shrimp diseases, price and availability of quality shrimp seeds, exploitation by intermediaries and uncertainty about the future demand for shrimp in foreign markets are perceived as the most important sources of risk. On the other hand, prevention of disease, timely supply of shrimp seeds, elimination of middlemen from the supply chain and farm management training are considered among the best methods to manage the risks in the shrimp‐farming business. We also observe some disparities in farmers’ perceptions. For instance, farmers mentioned that removal of influence of middlemen from supply chain is essential for the betterment of their business. However, they did not consider market monitoring, direct contract with processors and improved marketing facilities as important risk management strategies, although these factors play a significant role in reducing the influence of intermediaries and private money lenders.     

Remarks on the strong law of large numbers for a triangular array of associated random variables

A strong law of large numbers for a triangular array of strictly stationary associated random variables is proved. It is used to derive the pointwise strong consistency of kernel type density estimator of the one-dimensional marginal density function of a strictly stationary sequence of associated random variables, and to obtain an improved version of a result by Van Ryzin (1969) on the strong consistency of density estimator for a sequence of independent and identically distributed random variables.     

完善公共财政制度的体制机制创新——湖北实行省管县财政体制的实证分析与路径思考

湖北省2004年开始实行省管县财政管理体制改革,对其实证分析表明,这一改革举措是完善公共财政制度的体制机制创新,有利于巩固农村税费改革成果、全面推进农村综合改革;对深化改革的路径思考表明,要逐步实现基本公共服务均等化的改革目标,必须理顺事权财权关系,合理区别对待、分类指导,着重在运行机制上下功夫,不断增强公共产品和公共服务供给能力.     

The application of nonparametric tests to poverty targeting

Many otherwise successful social programs have limited outreach among the very poor. We show how a recently developed nonparametric test can detect this pattern of program participation. We apply the test to data on participation in a microcredit program in India and do find participation increasing in income among the poorest households in the region.     

Deposit insurance scheme and banking crises: a special focus on less-developed countries

This study analyzes the effect of an explicit deposit insurance scheme (EDIS) on the probability of a banking crisis in a country while taking the country’s overall economic development into account. The panel data for the period of 1980–2003 include all the countries having the data on an EDIS. The major finding is that if the interaction between a country’s overall economic development and its use of an EDIS is not controlled for, the country’s use of the EDIS increases the probability of a banking crisis. This increase is greater the more inefficiently designed the EDIS is. However, once the interaction between the overall economic development and the use of the EDIS is controlled for, it is found that the EDIS itself is not a significant factor of a banking crisis. In that case, the less developed the country is that is using an EDIS, the higher the probability of a banking crisis.     

A Study on Happiness and Related Factors Among Indian College Students

Happiness is considered to be one of the ultimate goals of life. This paper studies the happiness of Indian college and university students aged between 18 and 24 years. It attempts to answer whether and to what extent happiness of a student is significantly related to aspects of social life such as time spent with family, friends, being in a relationship, logging into social networking sites; academic factors such as job prospects of the chosen field of study and academic environment; and other personal factors such as health condition, over thinking or dwelling on past bad memories, addiction to tobacco/drug/alcohol. Moreover, this paper also inquires about the relationship between a student’s average happiness with her gender as well as the income class to which she belongs. It has been observed that among different aspects of social life, time spent with family and friends are significant while logging into social networking site is found out to be insignificant. Also being in a relationship is significantly but negatively related to happiness for male students. Job Prospects of the current field of study is a highly significant covariate of happiness irrespective of the gender of the student. Among different aspects of the personal situation, dwelling on past bad memories decreases happiness of both male and female students. Addiction to tobacco/alcohol is a negative covariate of female happiness. Furthermore, income and gender are seen to play an insignificant role in the happiness of Indian college and university students.

     

Texas Roundtable on: The Future of Graduate Business School Education

A small group of academics and practitioners discuss the challenges now facing today's business schools. First and foremost is the challenge now being mounted by “online” courses to the traditional methods of classroom lecture and discussion, supplemented in some cases by apprenticeships and other kinds of “experiential” learning. How will traditional universities burdened with high and rising fixed costs for buildings and faculty compete with very low‐cost competitors—programs that reportedly have enabled star lecturers to reach audiences that, in some cases, have exceeded 100,000 students? In assessing the seriousness of the challenge, the panelists start by attempting to articulate what is valuable in current business school education—valuable enough to enable the best business schools to command as much as $175,000 for two‐year (or shorter) programs that confer MBAs. Much of the discussion focuses on establishing the relative importance of the disciplines, or body of knowledge, that are taught in business schools, as compared to the development of “collaborative” habits and interpersonal skills aimed at enabling students to make more effective use of their knowledge within large organizations. Some of the panelists, notably Jeff Sandefer, founder of the (now ten‐year old) Acton School of Business, argue that far too much of today's business school curriculum is devoted to the classroom and conventional learning. And many of the changes in the top business schools during the past decade appear to reflect Sandefer's charges. But, to the extent there is a consensus among the other panelists, it is that the best business schools will continue to try to accomplish both of these goals, though with varying degrees of effectiveness, while most schools attempt to maintain their specialized capabilities, and carve out distinctive niches based on them. For some schools, such specialization is likely to mean continued emphasis on theory and classroom learning—though almost certainly with more attention to practical application and collaborative decision‐making. For other schools, the main focus will continue to be the development of general management and leadership skills.     

Do co-opted boards increase insider profitability?

Using a sample of U.S. firms over the period 1996–2014, this paper examines whether insider trading profitability increases with high board co-option. Indeed, we find that firms with a higher level of co-opted directors exhibit higher insider trading profitability, largely due to a lower level of managerial ability and analyst coverage. Co-opted boards are also unlikely to implement self-imposed insider trading restrictions, exacerbating this relationship. This positive association is mitigated by a higher level of external monitoring by institutional investors and if the CEO receives more performance-based incentives. Overall, co-opted directors demonstrate aligned interests with CEOs and corporate insiders rather than performing their role as monitors. As a result, a more co-opted board is positively associated with exploitative behaviour of insiders.