How does the market price pension accruals?

We use a cross-sectional valuation model that distinguishes between the operating and financial activities of the firm to examine the repercussions of three main alternative measures of pension expense. The GAAP Method recognizes a smoothed net pension expense, the NETCOST Method includes the excess of interest cost over the actual return on pension plan assets, if and only if this number is positive, and the FV Method substitutes the fair value in place of the smoothed pension expense. Three alternative fair value estimates of pension expense are examined: the first includes the expected return on plan assets and fair value other costs; the second includes the actual return on plan assets and net fair value other costs; the third includes the expected and the unexpected return on plan assets, along with net fair value other costs. Results from OLS regressions are consistent with the GAAP Method being relevant while the market appears to value the unexpected return included in the FV Method. Additional analyses from jack-knife (out-of-sample) regressions confirm the OLS findings. Further, we show that the multiples assigned to the alternative measures of pension expense differ based on the funding status of pension plans. The results are robust to various sensitivity checks

The effect of net positions by type of trader on volatility in foreign currency futures markets

We investigate the effect of net positions by type of trader on return volatility in six foreign currency futures markets using the weekly Commitments of Traders (COT) data. When net positions are decomposed into expected and unexpected components, we find that expected net positions by type of trader generally do not co-vary with volatility. However, volatility is positively associated with shocks (in either direction) in net positions of speculators and small traders, and negatively related to shocks (in either direction) in net positions of hedgers. This evidence suggests that changes in speculative positions destabilize the market. Consistent with dispersion of beliefs models and noise trading theories, hedgers appear to possess private information, whereas speculators and small traders are less informed in these markets.Foreign currency exchange futures; return predictability

Industry-Specific Capital and the Wage Profile: Evidence from the NLSY and the PSID

Using data from the NLSY (1979-1991) and from the Panel Study of Income Dynamics (PSID, 1981-1987), we seek to determine whether there is any net positive return to tenure with the current employer once we control for industry-specific capital. Using data from the PSID, Topel (JPE 1991) concluded that 10 years of seniority with an employer translated into a net return of about 25%. However, once we include total experience in the industry as an additional explanatory variable, the return to seniority vanishes almost completely when we use either OLS, GLS or IV-GLS estimation methods, although this conclusion varies somewhat according to the occupation, some occupation classes showing a negative net return to tenure and others showing a positive net return. Note also that this result holds whether the analysis is carried out at the 1-digit, 2-digit or 3-digit level. Therefore, it seems that what matters most for the wage profile in terms of human capital is not so much firm-specificity but industry-specificity. Avec les données du NLSY ainsi que celles du Panel Study of Income Dynamics (PSID), on cherche à déterminer s'il y a un rendement positif net lié à l'ancienneté dans la firme. Topel (JPE 1991) a montré avec un échantillon du PSID l'existence d'un rendement substantiel (25 % en 10 ans). Toutefois, du moment que l'on inclut l'expérience dans l'industrie courante dans l'équation de salaire (en plus de l'ancienneté dans la firme ainsi que l'expérience totale de travail), l'effet d'ancienneté disparaît presque complètement, que l'on estime par simples moindres carrés généralisés ou par la méthode des variables instrumentales (IV-GLS), et ce, avec les deux échantillons différents. ¸ noter également que ce résultat est robuste au degré d'agrégation des classes d'industries.Tenure ; Return, Ancienneté ; Rendement

Estimating the Impact of Immigrants on the Host Country Social Security System When Return Migration is an Endogenous Choice

In this paper, I estimate the fiscal impact of immigrants on the German pension insurance (PI) and unemployment insurance (UI) systems when return migration is an endogenous choice. For this purpose, I develop a dynamic stochastic model of joint return migration and saving decisions that accounts for uncertainty in future employment and income and estimate this model using a longitudinal data set on immigrants from five different source countries. I find that allowing for the endogeneity of the return decision makes a substantial difference in the net gain of the PI and UI systems from immigrants. Exogenous return migration – which has been the practice of the literature so far – underestimates the net gain for almost all demographic groups and the amount of underestimation is remarkable for several demographic groups. In addition, age-at-arrival profiles of net contributions of immigrants – which form the basis of suggestions on selective immigration policies in the literature – are rotated significantly. Finally, a counterfactual policy experiment in which cash bonuses are provided conditional on return to unemployed immigrants turns out be ineffective in terms of reducing the burden on the state coffers for most demographic groups.immigrant workers, life cycle models, saving, social security, public pensions, unemployment insurance, public policy

Building a Better Safety Net for the New New Orleans

The most vulnerable populations in New Orleans -- the elderly, people with physical and mental disabilities, and single mothers out of the labor market -- arguably were hit hardest by Katrina. These groups had the highest poverty rates and the fewest assets.Most were African American. Many depended on the social safety net for survival and on others to avoid the storm's catastrophic effects. Most of these vulnerable residents eventually evacuated the city, and it is unclear how many will return home. Research suggests that they will need the strong kinship networks established pre-Katrina (Hill 1993). But vulnerable populations also require a functioning safety net along with other necessities such as housing and health care discussed in earlier essays. Rebuilding presents New Orleans with a unique opportunity to strengthen its safety net for vulnerable populations that return and for others who will require help in the future

Canadian Farmers' Adaptation to Declining Commodity Prices

The five major agricultural producing provinces are compared in terms of farm labour and management incomes, return on investment to farm capital, total farm family income, and farm family net worth. In each province, comparisons are made with non-farm incomes, investment returns and net worth levels. The results show that farm family incomes in Canada are much better today than 30 years ago, returns on farmland investment are very comparable to average stock market returns, and average farm family net worth is significantly higher than the average for all families. The conclusion is that Canadian farmers have adapted well to declining commodity prices mainly by being adapters of and investors in new technologies, allowing them to increase farm size (increased cost efficiencies) and by diversifying their income sources to include more off-farm income.Farm Labour and Management Income, Return on Invested Farm Capital, Real Commodity Prices, Farm Family Income, Off-Farm Employment, Farm Family Net Worth, Farm Management, Labor and Human Capital,

ANALISIS PENGARUH RETURN ON ASSETS (ROA), RETURN ON EQUITY (ROE) DAN NET PROFIT MARGIN (NPM) TERHADAP RETURN SAHAM PADA PERUSAHAAN MANUFAKTUR YANG TERDAFTAR DI BURSA EFEK INDONESIA

Title "The Analysis Return on assets (ROA), return on equity (ROE), net profit margin (NPM) of the return on the stock of manufacturing companies listed in Indonesia Stock Exchange." This research aims to influence the performance tester manufacturing company (ROA, ROE, and NPM) of the shares and return of these three variables (ROA, ROE, and NPM) where the most significant return to shareholders registered at the Indonesian Stock Exchange. In this research, data analysis technique that is used is to perform calculations find ROA, ROE, NPM, stock return from year 2005,2006,2007, perform statistical testing, test the assumption of classical regression analysis and berganda. Research results indicate that simultaneously calculated F = 0.609 less than the F table = 3.80 means ROA, ROE, and NPM does not affect the stock return. And that the partial calculating ROA T = 0.899 T is less than the table means = 1.77 ROA does not affect the stock return. ROE calculated T = -0.437 is less than the table T = 1.77 does not mean ROE barpangaruh return to shareholders. NPM calculated T = -1.123 is less than Q = 1.77 means that the table NPM does not affect the stock return. This condition indicates that the ROA, ROE and NPM has contributed to a low return on shar

Asymmetric Taxation under Incremental and Sequential Investment

This article discusses the effects of an asymmetric tax scheme on incremental and sequential investment strategies. The tax base is equal to the firm’s return, net of an imputation rate. When the firm’s return is less than this rate, however, no tax refunds are allowed. This scheme is neutral under both income and capital uncertainty.corporate taxation, real options

A normative price for energy from an electricity generation system: An Owner-dependent Methodology for Energy Generation (system) Assessment (OMEGA). Volume 2: Derivation of system energy price equations

The methodology presented is a derivation of the utility owned solar electric systems model. The net present value of the system is determined by consideration of all financial benefits and costs including a specified return on investment. Life cycle costs, life cycle revenues, and residual system values are obtained. Break-even values of system parameters are estimated by setting the net present value to zero

Does It Pay To Attend An Elite Private College? Cross Cohort Evidence on the Effects of College Quality on Earnings

While there is evidence of a substantial and rising labor market premium associated with college attendance, little is known about how this premium varies across institutions of different quality and across time. Previous research which has estimated the return to college quality has not taken into account that individuals likely select the type of college they attend based in part on the expected economic return and net costs. In this paper we explicitly model high school students' choice of college type (characterized by quality and control) based on individual and family characteristics (including ability and parental economic status), and an estimate of the net costs of attendance and expected labor market return. We estimate selectivity corrected outcome equations, using data from both the National Longitudinal Study of the High School Class of 1972 and High School and Beyond, which permit us to determine the effects of college quality on wages and earnings and how this effect varies across time. Even after controlling for selection effects there is strong evidence of significant economic return to attending an elite private institution, and some evidence that this premium has increased over time.