Cumulative prospect theory and gambling

Whilst Cumulative Prospect theory (CPT) provides an explanation of gambling on longshots at actuarially unfair odds, it cannot explain why people might bet on more favoured outcomes. This paper shows that this is explicable if the degree of loss aversion experienced by the agent is reduced for small-stake gambles (as a proportion of wealth), and probability distortions are greater over losses than gains. If the utility or value function is assumed to be bounded, the degree of loss aversion assumed by Kahneman and Tversky leads to absurd predictions, reminiscent of those pointed out by Rabin (2000), of refusal to accept infinite gain bets at low probabilities. Boundedness of the value function in CPT implies that the indifference curve between expected-return and win-probability will typically exhibit both an asymptote (implying rejection of an infinite gain bet) and a minimum at low probabilities, as the shape of the value function dominates the probability weighting function. Also the high probability section of the indifference curve will exhibit a maximum. These implications are consistent with outcomes observed in gambling markets.

Do Fairness Opinion Valuations Contain Useful Information?

We analyze target firm valuations disclosed in the fairness opinions of negotiated mergers between 1998 and 2005. On average, acquirer advisors exhibit a greater degree of valuation optimism than do target advisors. Top-tier advisors produce more accurate valuations than lower-tier advisors, but valuation accuracy is unrelated to the contingency structure of advisory fees. The stock price reactions to merger announcements and to the public disclosure of fairness opinions are positively related to the difference between target firm valuations contained in the fairness opinion and the merger offer price. We conclude that fairness opinions contain information not previously available to market participants.

The Re-engagement in Education of Early School Leavers

By OECD standards, the share of the Australian labour force with at least a secondary school qualification is low. One way to rectify this shortfall is to improve rates of re-engagement in education among early school leavers. This paper examines the patterns of re-engagement among early school leavers in the HILDA sample. A key finding is that the early years after leaving school are crucially important, with rates of re-engagement dropping dramatically in the first three years out from school. For those who enter the labour market after school, results suggest that finding work, especially satisfying work, is an important driver for returning to study.Early school leavers, vocational education and training, re-engaging in education

Moose (Alces alces) browse enhancement and sustainable forestry as a rural development tool in the sub-Arctic boreal forest region of Alaska

Master's Project (M.A.) University of Alaska Fairbanks, 2014This project studies indigenous and western moose browse management issues in the sub-arctic boreal forest and how this topic relates to rural development. Chapter one explains the methodology of the project. Chapter two describes how moose browse and biomass management support rural development and investigates productivity potential of combining moose browse management with sustainable forestry and biomass production. Chapter three investigates landscape and habitat management principles from a customary and traditional practice versus a scientific approach. It looks at management models in the following territories: Alaska, Canada, Continental US, Mongolia/Russia and Scandinavia. Chapter four investigates indigenous wildlife management systems and other indigenous wildlife policy issues. Chapter five is a selected annotated bibliography. The project has a focus on the Ahtna region of central Alaska and recognizes the implications of these issues for this region

Issues that concern prison officers about HIV positive prisoners in Western Australia

In 1988 the Department of Corrective Services established an AIDS Standing Committee to draw up an HIV positive/AIDS policy. The Committee consists of ten members, two of whom are union members who represent the issues that concern 1,227 prison officers statewide. The Policy which was issued in 1989 medically isolated HIV positive prisoners from the mainstream prison population. The aim of this research is to identify and quantify the issues that concern prison officers about HIV positive prisoners in Western Australia. Such information will act as a medium through which these will be communicated to the AIDS Standing Committee. Structured questionnaires were mailed to 130 subjects taken from a stratified random sample of both country and metropolitan Western Australian prison officers. The results of these questionnaires identified the issues that concern prison officers about HIV positive prisoners in Western Australia. These results were written in the form of contingency tables and comments from the questions clarified these results. The research was guided by a theoretical context of participative management. This style of management encourages prison officers to participate in identifying the issues that concern them about HIV positive prisoners. These issues as well as the administrative and union issues will be identified in this research

Earnouts: A Study of Financial Contracting in Acquisition Agreements

We empirically examine earnout contracts, which provide for contingent payments in acquisition agreements. Our analysis reveals considerable heterogeneity in the terms of earnout contracts, i.e. the potential size of the earnout, the performance measure on which the contingent payment is based, the period over which performance is measured, the frequency with which performance is measured, and the form of payment for the earnout. Consistent with the costly contracting hypothesis, we find that the terms of earnout contracts are associated with measures of target valuation uncertainty, target growth opportunities, and the degree of post-acquisition integration between target and acquirer. We conclude that earnouts are structured to minimize the costs of adverse selection and moral hazard in acquisition negotiations.

"Death Comes In Between": Reflections on Kierkegaard's For Self-Examination

"Death Comes In Between": Reflections on Kierkegaard's For Self-Examinatio