A New Empirical Approach to Explain the Stock Market Yield: A Combination of Dynamic Panel Estimation and Factor Analysis

This paper presents an empirical approach that combines competing paradigms of modeling in empirical capital market research. The approach simultaneously estimates the explanatory power of fundamentals, expectations, and historic yield patterns, making it possible to test the extent to which the efficient market hypothesis, fundamental data analysis, and behavioral finance contribute to explaining stock market yield. The core of the approach is a dynamic panel model (Arellano-Bond estimator with an MA restriction of the residuals), complemented with an upstream factor analysis to reduce multicollinearity. Due to the complexity of the data set, a great many parameters that influence the yield can be determined. Highly significant parameter estimates are possible even though the information in the data set is interdependent. For the German stock market (the 160 companies listed in DAX, MDAX, SDAX, and TecDAX), the quarterly yield is analyzed for the period between 2004 and 2009. The model has high explanatory power for the entire observation period, even in light of the fact that the period includes the financial crisis of 2008

Market institutions and judicial rulemaking

Assuming that the degree of discretion granted to judges was the main distinguishing feature between common and civil law until the 19th century, we argue that constraining judicial discretion was instrumental in protecting freedom of contract and developing the market order in civil law. We test this hypothesis by analyzing the history of Western law. In England, a unique institutional balance between the Crown and the Parliament guaranteed private property and prompted the gradual evolution towards a legal framework that facilitated market relationships, a process that was supported by the English judiciary. On the Continent, however, legal constraints on the market were suppressed in a top-down fashion by the founders of the liberal state, often against the will of the incumbent judiciary. Constraining judicial discretion there was essential for enforcing freedom of contract and establishing the legal order of the market economy. In line with this evidence, our selection hypothesis casts doubts on the normative interpretation of empirical results that proclaim the superiority of one legal system over another, disregarding the local conditions and institutional interdependencies on which each legal system was grounded

Measurement of charged particle spectra in minimum-bias events from proton-proton collisions at root s =13 TeV

Pseudorapidity, transverse momentum, and multiplicity distributions are measured in the pseudorapidity range vertical bar eta vertical bar 0.5 GeV in proton-proton collisions at a center-of-mass energy of root s = 13 TeV. Measurements are presented in three different event categories. The most inclusive of the categories corresponds to an inelastic pp data set, while the other two categories are exclusive subsets of the inelastic sample that are either enhanced or depleted in single diffractive dissociation events. The measurements are compared to predictions from Monte Carlo event generators used to describe high-energy hadronic interactions in collider and cosmic-ray physics.Peer reviewe