The Hold-Out Problem

Suppose a developer wants to buy n adjacent blocks of land that are currently in the possession of n different owners. The value of the blocks of land to the developer is greater than the sum of the individual values of the blocks for each owner. Under complete information about individual valuations, the developer could make a take-it-or-leave-it simultaneous offer to all owners equal to their valuations. The owners would accept the offers, the outcome would be efficient and the developer would get all the surplus. On the other hand, if the owner were to negotiate with the owners sequentially, the final division of the surplus would depend on who would have make the final offer. This individual would end up with the entire surplus and the efficient allocation would be implemented but at the expense of costly delay. Given the possible advantage that arises from being the last to make an offer, players may strategically delay the start of a negotiation. This is the hold-out problem that we examine in this paper. We develop a model in which players decide on the probability that they will go to the negotiating table with the developer. We characterise the full set of equilibria as they correspond to functions of owners valuations, and the developers valuation of subsets of land. Hold out occurs when the developer's valuation of individual blocks is the same as individual owners valuations, or if the valuation of all of the blocks of land by the developer is sufficiently large.

Do Firms in Countries with Poor Protection of Investor Rights Hold More Cash?

Managers make different decisions in countries with poor protection of investor rights and poor financial development. One possible explanation is that shareholder-wealth maximizing managers face different tradeoffs in such countries (the tradeoff theory). Alternatively, firms in such countries are less likely to be managed for the benefit of shareholders because the poor protection of investor rights makes it easier for management and controlling shareholders to appropriate corporate resources for their own benefit (the agency costs theory). Holdings of liquid assets by firms across countries are consistent with Keynes' transaction and precautionary demand for money theories. Firms in countries with greater GDP per capita hold more cash as predicted. Controlling for economic development, firms in countries with more risk and with poor protection of investor rights hold more cash. The tradeoff theory and the agency costs theory can both explain holdings of liquid assets across countries. However, the fact that a dollar of cash is worth less than $0.65 to the minority shareholders of firms in such countries but worth approximately$1 in countries with good protection of investor rights and high financial development is only consistent with the agency costs theory.

Corporate Governance and the Home Bias

In most countries, many of the largest corporations are controlled by large shareholders. We show that, under reasonable assumptions, this stylized fact implies that portfolio holdings of U.S. investors should exhibit a home bias in equilibrium. We construct an estimate of the world portfolio of shares available to investors who are not controlling shareholders. This available world portfolio differs sharply from the world market portfolio. In regressions explaining the portfolio weights of U.S. investors, the world portfolio of available shares has a positive significant coefficient but the world market portfolio has no additional explanatory power. This result holds when we control for country characteristics.

Presumed choroidal metastasis from soft tissue myoepithelial carcinoma

Purpose: To report a case of presumed choroidal metastasis from soft tissue myoepithelial carcinoma and highlight challenges in its diagnosis. Observations: A 52-year-old man was referred with a two-week history of photopsia in his left eye. His background medical history included known soft tissue myoepithelial carcinoma metastatic to his bone, lung, liver and chest wall. A large, raised, yellow choroidal lesion was identified nasal to and abutting the optic disc. This lesion demonstrated growth 1 month after presentation. The patient died with widespread metastatic disease 5 months after initial presentation. Conclusion and importance: Soft tissue myoepithelial carcinoma can rarely metastasise to the choroid and present as a rapidly-growing, yellow, echodense tumour with serous retinal detachment. MRI brain can assist in tumour evaluation and monitoring progression, while immunoperoxidase stains and molecular testing can assist with diagnosis. The condition has an aggressive natural history and poor prognosi

An Experimental Investigation of Self-Excited Combustion Dynamics in a Single Element Lean Direct Injection (LDI) Combustor

The management of combustion dynamics in gas turbine combustors has become more challenging as strict NOx/CO emission standards have led to engine operation in a narrow, lean regime. While premixed or partially premixed combustor configurations such as the Lean Premixed Pre-vaporized (LPP), Rich Quench Lean burn (RQL), and Lean Direct Injection (LDI) have shown a potential for reduced NOx emissions, they promote a coupling between acoustics, hydrodynamics and combustion that can lead to combustion instabilities. These couplings can be quite complex, and their detailed understanding is a pre-requisite to any engine development program and for the development of predictive capability for combustion instabilities through high-fidelity models. The overarching goal of this project is to assess the capability of high-fidelity simulation to predict combustion dynamics in low-emissions gas turbine combustors. A prototypical lean-direct-inject combustor was designed in a modular configuration so that a suitable geometry could be found by test. The combustor comprised a variable length air plenum and combustion chamber, air swirler, and fuel nozzle located inside a subsonic venturi. The venturi cross section and the fuel nozzle were consistent with previous studies. Test pressure was 1 MPa and variables included geometry and acoustic resonance, inlet temperatures, equivalence ratio, and type of liquid fuel. High-frequency pressure measurements in a well-instrumented metal chamber yielded frequencies and mode shapes as a function of inlet air temperature, equivalence ratio, fuel nozzle placement, and combustor acoustic resonances. The parametric survey was a significant effort, with over 105 tests on eight geometric configurations. A good dataset was obtained that could be used for both operating-point-dependent quantitative comparisons, and testing the ability of the simulation to predict more global trends. Results showed a very strong dependence of instability amplitude on the geometric configuration of the combustor, i.e., its acoustic resonance characteristics, with measured pressure fluctuation amplitudes ranged from 5 kPa (0.5% of mean pressure) to 200 kPa (~20% of mean pressure) depending on combustor geometry. The stability behavior also showed a consistent and pronounced dependence on equivalence ratio and inlet air temperature. Instability amplitude increased with higher equivalence ratio and with lower inlet air temperature. A pronounced effect of fuel nozzle location on the combustion dynamics was also observed. Combustion instabilities with the fuel nozzle at the throat of the venturi throat were stronger than in the configuration with fuel nozzle 2.6 mm upstream of the nozzle. A second set of dynamics data was based on high-response-rate laser-based combustion diagnostics using an optically accessible combustor section. High-frequency measurements of OH*-chemiluminescence and OH-PLIF and velocity fields using PIV were obtained at a relatively stable, low equivalence ratio case and a less stable case at higher equivalence ratio. PIV measurements were performed at 5 kHz for non-reacting flow but glare from the cylindrical quartz chamber limited the field of view to a small region in the combustor. Quantitative and qualitative comparisons were made for five different combinations of geometry and operating condition that yielded discriminating stability behavior in the experiment with simulations that were carried out concurrently. Comparisons were made on the basis of trends and pressure mode data as well as with OH-PLIF measurements for the baseline geometry at equivalence ratios of 0.44 and 0.6. Overall, the ability of the simulation to match experimental data and trends was encouraging. Dynamic Mode Decomposition (DMD) analysis was performed on two sets of computations - a global 2-step chemistry mechanism and an 18-step chemistry mechanism - and the OH-PLIF images to allow comparison of dynamic patterns of heat release and OH distribution in the combustion zone. The DMD analysis was able to identify similar dominant unstable modes in the combustor. Recommendations for future work are based on the continued requirement for quantitative and spatio-temporally resolved data for direct comparison with computational efforts to develop predictive capabilities for combustion instabilities at relevant operating conditions. Discriminating instability behavior for the prototypical combustor demonstrated in this study is critical for any robust validation effort Unit physics based scaling of the current effort to multi-element combustors along with improvement in diagnostic techniques and analysis efforts are recommended for advancement in understanding of the complex physics in the multi-phase, three dimensional and turbulent combustion processes in the LDI combustor

Some results on the choice of run order for experimental designs with correlated errors : a thesis presented in partial fulfilment of the requirements for the degree of M.Sc. in Statistics at Massey University

This thesis examines the efficiency of some commonly used experimental designs in situations where the assumption of independent errors is violated. In particular this research mainly involves finding efficient run orders for various models of two level factorial experiments, three level factorial experiments and response surface designs when errors are assumed to follow either first order moving average model or first order autoregressive model. In this thesis, attention is given to systematic methods of allocating treatments based on various algorithms which provide more efficient designs and lead to good estimates of the parameters

Corporate Governance and the Home Bias

This paper shows that there is a close relation between corporate governance and the portfolios held by investors. Most firms in countries with poor investor protection are controlled by large shareholders, so that only a fraction of the shares issued by firms in these countries can be freely traded and held by portfolio investors. We show that the prevalence of closely-held firms in most countries helps explain why these countries exhibit a home bias in share holdings and why U.S. investors underweight foreign countries in their portfolios. We construct an estimate of the world portfolio of shares available to investors who are not controlling shareholders (the world float portfolio). The world float portfolio differs sharply from the world market portfolio. In regression explaining the portfolio weights of U.S. investors, the world float portfolio has a positive significant coefficient but the world market portfolio has no additional explanatory power. This result holds when we control for country characteristics. An analysis of foreign investor holdings at the firm level for Sweden confirms the importance of the float portfolio as a determinant of these holdings.World float portfolio; Portfolio choice; Closely held shares

Do U.S. Firms Have the Best Corporate Governance? A Cross-Country Examination of the Relation between Corporate Governance and Shareholder Wealth

We compare the governance of foreign firms to the governance of similar U.S. firms. Using an index of firm governance attributes, we find that, on average, foreign firms have worse governance than matching U.S. firms. Roughly 8% of foreign firms have better governance than comparable U.S. firms. The majority of these firms are either in the U.K. or in Canada. When we define a firm's governance gap as the difference between the quality of its governance and the governance of a comparable U.S. firm, we find that the value of foreign firms increases with the governance gap. This result suggests that firms are rewarded by the markets for having better governance than their U.S. peers. It is therefore not the case that foreign firms are better off simply mimicking the governance of comparable U.S. firms. Among the individual governance attributes considered, we find that firms with board and audit committee independence are valued more. In contrast, other attributes, such as the separation of the chairman of the board and of the CEO functions, do not appear to be associated with higher shareholder wealth.