Turning Over Turnover

The methodology of Bai and Ng (2002, 2003) for decomposing large panel data into systematic and idiosyncratic components is applied to both returns and turnover. Combining this with a GLS-based principal components approach, we demonstrate that their procedure works well for both returns and turnover despite the presence of severe heteroscedasticity and non-stationarity in turnover of individual stocks. We then test Lo and Wang's (2000) theoretical model's restriction that returns and turnover should have the same number of systematic factors. This is songly rejected by the data, suggesting stock price and trading volume may not be compatible under the existing multi-factor asset pricing-trading framework. We also demonsate that several commonly used turnover measures may understate the price impact of stock trading

Human rights violations against sexuality minorities in India: a PUCL-K fact-finding report about Bangalore

"What became apparent in the course of our study is that discrimination against sexuality minorities is embedded in both state and civil society. Any proposal for social change would have to take into account this complex reality. A greater respect for sexuality minorities as people would depend upon a variety of factors, including a change in gender relations and class relations. Change would also crucially hinge upon overturning the existing regime of sexuality that enforces its own hierarchies, (e.g. heterosexuality over homosexuality), exclusions (e.g. hijras as the excluded category) and oppressions. Despite the importance of social change, one still has to redress the ongoing human rights violations against sexuality minorities.

The role of education and research in enhancing rural women's income and household happiness

"When I received the invitation to deliver this lecture, I accepted it immediately because of the opportunity the occasion will provide to recall the message and meaning of J.P.’s life and work. J.P.’s interests were many and varied and picking one theme out of the many with which he was emotionally and intellectually connected, for treatment at this first lecture instituted in his memory became difficult. I finally chose the role of education and research in enhancing rural women’s income and thereby the happiness of economically poor households because this is a topic which J.P. and I had discussed on several occasions. Also, it is my conviction that only when women are enabled to participated in an equal measure with men in national development that effective remedies can be found for the major socio-economic maladies facing our country such as rapid population growth, under the mal-nutrition leading to a possible stunting of physical and mental development in children, under and unemployment and extensive eco-destruction.

Outcomes of social work education: The case for social work self-efficacy

Has social work education been effective at promoting the development of specific practice skills and how can students’ skill levels feasibly be assessed? This paper describes the development and testing of the Social Work Self-Efficacy Scale, which assesses social workers’ confidence regarding a broad range of social work tasks. Pre-post data from two cohorts of social work students are presented showing significant positive change in MSW students’ self-efficacy, suggesting a new approach to outcomes assessment in social work education. Final version of background manuscript for citation: Holden, G., Meenaghan, T., Anastas, J. & Metrey, G. (2002). Outcomes of social work education: The case for social work self-efficacy. Journal of Social Work Education, 38, 115-133

Why Do CEO's Reciprocally Sit On Each Other's Boards?

The reciprocal interlocking of chief executive officers (CEOs) is a non-trivial phenomenon of the composition of boards of directors and of corporate governance: among large companies in 1991, about one company in seven is part of a relationship whereby the CEO of one company sits on a second company's board and the second company's CEO sits on the first company's board. We are aware of no previous efforts to explain these reciprocal relationships. We hypothesize that reciprocal CEO interlocks are (a) more likely when a board has more outside directorships, (b) less likely when a CEO has more of his total annual compensation paid in the form of stock options, (c) less likely when a company's board is more active and holds more meetings, (d) less likely when a CEO has a larger ownership share of his company, and (e) more likely when there are more CEOs from other companies as outside directors on a CEO's board. Using a sizable sample of large companies in 1991, we employ simple probit and step probit models to test these hypotheses, with the use of control variables that encompass other company, board, and CEO characteristics. These multivariate analyses support our first three conjectures but do not support the remaining two. Since there is considerable academic and policy debate concerning board composition and the effectiveness of interlocking directorships in general, investigations focusing on reciprocal CEO interlocks, which link the highest ranked executives of two different firms, represent a significant contribution to the knowledge base in this field

Compatibility and Market Structure for Network Goods

This paper analyzes the economics of industries where network externalities are significant. In such industries, firms have strong incentives to adhere to common technical compatibility standards, so that they reap the network externalities of the whole group. However, a firm also benefits from producing an incompatible product thereby increasing its horizontal product differentiation. We show how competition balances these opposing incentives. We find that market equilibria often exhibit extreme disparities in sales, output prices, and profits across firms, despite no inherent differences in the firms’ production technologies. This may explain the frequent domination of network industries by one or two firms. We also find that the presence of network externalities dramatically affects conventional welfare analysis, as total surplus in markets where these externalities are strong is highest under monopoly and declines with entry of additional firms

Why Did FDR’s Bank Holiday Succeed?

After a month-long run on American banks, Franklin Delano Roosevelt proclaimed a Bank Holiday beginning March 6, 1933 that shut down the banking system. When banks reopened on March 13, 1933, depositors stood in line to return their hoarded cash. This paper traces the remarkable turnaround in the public’s confidence to the Emergency Banking Act, passed by Congress on March 9, 1933. Roosevelt used the emergency currency provisions of the Act to prod the Federal Reserve to create de facto deposit insurance in the reopened banks. The contemporary press confirms that the public recognized the implicit guarantee, and as a result, believed the President’s words in his first Fireside Chat on March 12, 1933, that the reopened banks would be safe. The public responded by returning more than half of their hoarded cash to the banks within two weeks and by bidding up stock prices on March 15, 1933, the first trading day after the Bank Holiday ended, by the largest ever one-day percentage price increase. The Bank Holiday and the Emergency Banking Act of 1933 reestablished the integrity of the payments system and demonstrated the power of credible regime-shifting policies

The Max-Min-Min Principle of Product Differentiation

We analyze two and three-dimensional variants of Hotelling’s model of differentiated products. In our setup, consumers can place different importance on each product attribute; this is measured by a weight in the disutility of distance in each dimension. Two firms play a two-stage game; they choose locations in stage 1 and prices in stage 2. We seek subgame-perfect equilibria. We find that all such equilibria have maximal differentiation in one dimension only; in all other dimensions, they have minimum differentiation. An equilibrium with maximal differentiation in a certain dimension occurs when consumers place sufficient importance (weight) on that attribute. Thus, depending on the importance consumers place on each attribute, in two dimensions there is a max-min equilibrium, a min-max equilibrium, or both. In three dimensions, depending on the weights, there can be a max-min-min equilibrium, a min-max-min equilibrium, a min-min-max equilibrium, any two of them, or all three