Determinants of Leverage and Agency problems

In this paper we empirically investigate the determinants of leverage and agency problems and we examine the relationships between leverage and agency problems. As in Titman and Wessels (1988) we use structural equations modeling with latent variables. In contrast to Titman and Wessels (1988), who employ data obtained from annual reports and capital markets, we use questionnaire data to measure firm characteristics. The questions concern the characteristics of the respondents’ firms, including the presence of agency problems. We estimate the relations between these characteristics. The results confirm that the trade-off between tax advantages and bankruptcy costs determines leverage. We also find free cash flow and corporate governance characteristics as determinants of overinvestment. Despite findings that agency problems are present, direct relationships between leverage and four agency problems are absent.capital structure;agency costs

Option Formulas for Mean-Reverting Power Prices with Spikes

Electricity prices are known to be very volatile and subject tofrequent jumps due to system breakdown, demand shocks, and inelasticsupply. Appropriate pricing, portfolio, and risk management modelsshould incorporate these spikes. We develop a framework to priceEuropean-style options that are consistent with the possibility ofmarket spikes. The pricing framework is based on a regime jump modelthat disentangles mean-reversion from the spikes. In the model thespikes are truly time-specific events and therefore independent fromthe mean-reverting price process. This closely resembles thecharacteristics of electricity prices, as we show with Dutch APX spotprice data in the period January 2001 till June 2002. Thanks to theindependence of the two price processes in the model, we breakderivative prices down in a mean-reverting value and a spike value. Weuse this result to show how the model can be made consistent withforward prices in the market and present closed-form formulas forEuropean-style options.mean reversion;electricity price modelling;energy markets;option pricing;power spikes

From Skews to a Skewed-t

In this paper we present a new methodology to infer the implied risk-neutral distribution function from European-style options. We introduce a skewed version of the Student-t distribution, whose main advantage is that its shape depends on only four parameters, of which two directly control for the levels of skewness and kurtosis. We can thus easily vary parameters to compare different distributions and use the parameters as inputs to price other options. We explain the method, provide some empirical results and compare them with the results of alternative models. The results indicate that our model provides a better fit to market prices of options than the Shimko or implied tree models, and has a lower computation time than most other models. We conclude that the skewed Student-t method provides a good alternative for European-style options.implied distribution;implied volatility;options;skewness;student-t

Search for the magnetic field of the O7.5 III star xi Persei

Cyclical wind variability is an ubiquitous but as yet unexplained feature among OB stars. The O7.5 III(n)((f)) star xi Persei is the brightest representative of this class on the Northern hemisphere. As its prominent cyclical wind properties vary on a rotational time scale (2 or 4 days) the star has been already for a long time a serious magnetic candidate. As the cause of this enigmatic behavior non-radial pulsations and/or a surface magnetic field are suggested. We present a preliminary report on our attempts to detect a magnetic field in this star with high-resolution measurements obtained with the spectropolarimeter Narval at TBL, France during 2 observing runs of 5 nights in 2006 and 5 nights in 2007. Only upper limits could be obtained, even with the longest possible exposure times. If the star hosts a magnetic field, its surface strength should be less than about 300 G. This would still be enough to disturb the stellar wind significantly. From our new data it seems that the amplitude of the known non-radial pulsations has changed within less than a year, which needs further investigation.Comment: 2 pages, 6 figures, contributed poster at IAU Symposium 259 "Cosmic Magnetic Fields: from Planets, to Stars and Galaxies", Tenerife, Spain, November 3-7, 200

Non score-dependency: Theory and assessment

Untrained listeners demonstrate implicit knowledge of syntactic patterns and principles. Untrained generative music ability, for example singing, humming, and whistling, is a largely unconscious or intuitive application of these patterns and principles. From the viewpoint of embodied cognition, listening to music should evoke an internal representation or motor image which, together with the perception of organized music, should form the basis of musical cognition. Indeed, that is what listeners demonstrate when they sing, hum, or whistle familiar and unfamiliar tunes or when they vocally or orally improvise continuations to interrupted phrases. Research on vocal improvisation using continuations sung to an interrupted musical phrase, has shown that one’s cultural background influences the music generated. That should be the case for instrumentalists as well: when they play familiar or unfamiliar tunes by ear in different keys (transposition) or when they improvise variations, accompaniments, or continuations to interrupted phrases, the music they generate should reflect the same cognitive structures as their oral improvisations. This study is attempting to validate a test of (non) scoredependency that will enable assessment of the music student’s implicit knowledge of these structures during performance on the principal instrument

A Look At Three Different Scenarios for Bulge Formation

In this paper, we present three qualitatively different scenarios for bulge formation: a secular evolution model in which bulges form after disks and undergo several central starbursts, a primordial collapse model in which bulges and disks form simultaneously, and an early bulge formation model in which bulges form prior to disks. We normalize our models to the local z=0 observations of de Jong & van der Kruit (1994) and Peletier & Balcells (1996) and make comparisons with high redshift observations. We consider model predictions relating directly to bulge-to-disk properties. As expected, smaller bulge-to-disk ratios and bluer bulge colors are predicted by the secular evolution model at all redshifts, although uncertainties in the data are currently too large to differentiate strongly between the models.Comment: 19 pages, 6 figures, accepted for publication in the Astrophysical Journa

Aspects of competence-based education as footholds to improve the connectivity between learning in school and in the workplace

Recent developments in competence-based education have motivated institutions of vocational education and training (VET) to improve the links or connectivity between learning in school and learning in the workplace, which has been a problem for decades. In previous research, a theoretical framework describing the underlying aspects of competence-based education was developed. In this study, three aspects of this framework were used to analyse connectivity between learning in school and learning in the workplace. These aspects were: i) authenticity, ii) selfresponsibility, and iii) the role of the teacher as expert and coach. Three stakeholder groups (i.e., students, teachers, and workplace training supervisors) involved in secondary VET programs in the field of life sciences in the Netherlands were questioned on these aspects. Based on their interviews, it is concluded that these aspects provide information about the process of connectivity. Because stakeholder groups hold different conceptions of workplace learning and often do not communicate adequately about mutual responsibilities, the implementation of these aspects of competence-based education has not significantly improved the connectivity situation. Nevertheless, these aspects of competence-based education can guide stakeholder groups in making clearer agreements about mutual responsibilities, which may improve connectivity in the futur

A new catalog of photometric redshifts in the Hubble Deep Field

Using the newly available infrared images of the Hubble Deep Field in the J, H, and K bands and an optimal photometric method, we have refined a technique to estimate the redshifts of 1067 galaxies. A detailed comparison of our results with the spectroscopic redshifts in those cases where the latter are available shows that this technique gives very good results for bright enough objects (AB(8140) < 26.0). From a study of the distribution of residuals (Dz(rms)/(1+z) ~ 0.1 at all redshifts) we conclude that the observed errors are mainly due to cosmic variance. This very important result allows for the assessment of errors in quantities to be directly or indirectly measured from the catalog. We present some of the statistical properties of the ensemble of galaxies in the catalog, and finish by presenting a list of bright high-redshift (z ~ 5) candidates extracted from our catalog, together with recent spectroscopic redshift determinations confirming that two of them are at z=5.34 and z=5.60.Comment: 28 pages, 12PS+4JPEG figures, aaspp style. Accepted for publication in The Astrophysical Journal. The catalog, together with a clickable map of the HDF, Tables 4 and 5 (HTML, LaTeX or ASCII format), and the figures, are available at http://bat.phys.unsw.edu.au/~fsoto/hdfcat.htm

Probabilities of spurious connections in gene networks: Application to expression time series

Motivation: The reconstruction of gene networks from gene expression microarrays is gaining popularity as methods improve and as more data become available. The reliability of such networks could be judged by the probability that a connection between genes is spurious, resulting from chance fluctuations rather than from a true biological relationship. Results: Unlike the false discovery rate and positive false discovery rate, the decisive false discovery rate (dFDR) is exactly equal to a conditional probability without assuming independence or the randomness of hypothesis truth values. This property is useful not only in the common application to the detection of differential gene expression, but also in determining the probability of a spurious connection in a reconstructed gene network. Estimators of the dFDR can estimate each of three probabilities: 1. The probability that two genes that appear to be associated with each other lack such association. 2. The probability that a time ordering observed for two associated genes is misleading. 3. The probability that a time ordering observed for two genes is misleading, either because they are not associated or because they are associated without a lag in time. The first probability applies to both static and dynamic gene networks, and the other two only apply to dynamic gene networks. Availability: Cross-platform software for network reconstruction, probability estimation, and plotting is free from http://www.davidbickel.com as R functions and a Java application.Comment: Like q-bio.GN/0404032, this was rejected in March 2004 because it was submitted to the math archive. The only modification is a corrected reference to q-bio.GN/0404032, which was not modified at al

Power harvesting in a helicopter lag damper

In this paper a new power harvesting application is developed and simulated. Power harvesting is chosen within the European Clean Sky project as a solution to powering in-blade health monitoring systems as opposed to installing an elaborate electrical infrastructure to draw power from and transmit signals to the helicopter body. Local generation of power will allow for a ‘plug and play’ rotor blade and signals may be logged or transmitted wirelessly.\ud The lag damper is chosen to be modified as it provides a well defined loading due to the re-gressive damping characteristic. A piezo electric stack is installed inside the damper rod, effec-tively coupled in series with the damper. Due to the well defined peak force generated in the damper the stack geometry requires a very limited margin of safety. Typically the stack geometry must be chosen to prevent excessive voltage build-up as opposed to mechanical overload.\ud Development and simulation of the model is described starting with a simplified blade and piezo element model. Presuming specific flight conditions transient simulations are conducted using various power harvesting circuits and their performance is evaluated. The best performing circuit is further optimized to increase the specific power output. Optimization of the electrical and mechanical domains must be done simultaneously due to the high electro-mechanical cou-pling of the piezo stack. The non-linear electrical properties of the piezo material, most notably the capacitance which may have a large influence, are not yet considered in this study.\ud The power harvesting lag damper provides sufficient power for extensive health monitoring systems within the blade while retaining the functionality and safety of the standard component. For the 8.15m blade radius and 130 knots flight speed under consideration simulations show 7.5 watts of power is generated from a single damper