How Prices are Determined

PDF pages: 2

How to Determine Shrinkage in Grain

PDF pages: 1

Beyond the Tunnel Problem, Addressing Cross-Cutting Issues that Impact Vulnerable Youth

Across the country, mayors, commissioners, superintendents, governors, and state policymakers are innovating to address the needs of vulnerable youth. These efforts take many forms: restructuring high schools to improve graduation rates, creating developmentally appropriate interventions to reduce juvenile delinquency, and revamping child welfare practices to keep more youth safely in their homes are just a few of these strategies. Many initiatives, however, are plagued by "crosscutting problems" -- issues that cut across the different agencies that serve youth. Unless crosscutting issues are addressed proactively, they may undermine systemic reforms. This short paper is the first in a series of briefing papers designed to inform officials, practitioners, funders, advocates, scholars and the general public about crosscutting problems and possible solutions to these problems. This paper focuses primarily on the authors' experiences in New York City, though many of the crosscutting problems discussed are known to occur in many jurisdictions large and small. The series starts by presenting a typology of crosscutting issues. The next paper in this series will elaborate on a specific area -- namely, juvenile justice and education. Additional briefing papers will focus on local initiatives that tackle specific problems and more systemic attempts to solve crosscutting issues

Can Markets Learn to Avoid Bubbles?

One of the most striking results in experimental economics is the ease with which market bubbles form in a laboratory setting and the difficulty of preventing them. This article re-examines bubble experiments in light of the results of an earlier series of market experiments that examine how learning occurs in markets characterized by an asymmetry of information between buyers and sellers, such as found in Akerlof’s lemons model and Spence’s signaling model and extends the arguments put forth in the author’s book, Paving Wall Street: Experimental Economics and the Quest for the Perfect Market. Markets with asymmetric information are incomplete because they lack markets for specific levels of product quality. Such markets either lump all qualities together (lemons) or using external indications of quality to separate them (signaling). Similarly, the markets used in bubble experiments are incomplete in that they are lacking a complete set of forward or futures markets, depriving traders of the information supplied by the prices in those markets. Preliminary experimental results suggest that the addition of a single forward market can sometimes mitigate bubble formation and this article suggests more extensive research in this direction is warranted. Market bubbles outside of the laboratory usually are found in markets in with forward and futures markets that are either legally restricted or otherwise limited. Experimentation in markets with asymmetric information also indicates that the ability of subjects to learn how to send and receive signals can be enhanced by changing the way that market information is presented to them. We explore how this result might be used to help asset markets learn to avoid bubbles.Market bubbles, learning and adaptation, behavioral finance, signaling, asymmetric information

Measuring the True Cost of Active Management by Mutual Funds

Recent years have seen a dramatic shift from mutual funds into hedge funds even though hedge funds charge management fees that have been decried as outrageous. While expectations of superior returns may be responsible for this shift, this article shows that mutual funds are more expensive than commonly believed. Mutual funds appear to provide investment services for relatively low fees because they bundle passive and active funds management together in a way that understates the true cost of active management. In particular, funds engaging in “closet” or “shadow” indexing charge their investors for active management while providing them with little more than an indexed investment. Even the average mutual fund, which ostensibly provides only active management, will have over 90% of the variance in its returns explained by its benchmark index. This article derives a method for allocating fund expenses between active and passive management and constructs a simple formula for finding the cost of active management. Computing this “active expense ratio” requires only a fund’s published expense ratio, its R-squared relative to a benchmark index, and the expense ratio for a competitive fund that tracks that index. At the end of 2004, the mean active expense ratio for the large-cap equity mutual funds tracked by Morningstar was 7%, over six times their published expense ratio of 1.15%. More broadly, funds in the Morningstar universe had a mean active expense ratio of 5.2%, while the largest funds averaged a percent or two less.mutual fund expenses, cost allocation, active expense ratio, active alpha, portable alpha

Allocating Resources within a Big City School District: New York City after Campaign for Fiscal Equity v. New York

In this brief we take a closer look at the mechanisms used to distribute resources across public schools. We first present what we know about the current distribution of educational resources within New York City and other large city districts. Then we discuss current efforts to promote greater equity in the distribution of resources and improve student performance. We conclude with lessons and policy implications for New York State as it implements the CFE decision in New York City. These findings also apply toother large districts in the state, such as Buffalo, Rochester, Syracuse, and Albany. Our focus in this brief is on vertical equity--ensuring that schools serving students with different levels of need receive appropriately different levels of resources--rather than adequacy. But the two concepts are closely related. If we ensure that students with a variety of needs have ample resources to achieve agreed upon educational goals, we will achieve both school-level adequacy and vertical equity.intradistrict resource allocation; interdistrict resource allocation; vertical equity; across-school disparities; school-based funding; weighted student funding.

Jumped or pushed: what motivates NHS staff to set up a social enterprise?

Purpose – The purpose of this paper is to examine the motivations behind public sector spin outs, focusing on the Right to Request policy, which enabled NHS staff to set up their own social enterprises to deliver healthcare services.\ud \ud Design/methodology/approach – The paper draws on empirical data gathered from 16 in-depth interviews with individuals who had led a Right to Request proposal.\ud \ud Findings – Motivations to spin out of the NHS into a social enterprise were often “empathetic” in nature, built around the good of the service for staff and users. Alongside this, some felt “pushed” out of the NHS as a result of government restructuring policy, with social enterprise offering the only hope to survive as an organisation.\ud \ud Research limitations/implications – The study captures a particular point in time and there may be other perspectives that have not been included.\ud \ud Social implications – The paper is of use to academics, policy makers and practitioners. It provides an important contribution in thinking about how to motivate public sector staff, especially those from a health profession, to consider spinning out into social enterprises.\ud \ud Originality/value – The paper is the first to look at the motivations of healthcare spin outs through the Right to Request programme. The findings are related to previous literature on social entrepreneurship within public sector settings.\u

A systematic look at the Very High and Low/Hard state of GX 339-4: Constraining the black hole spin with a new reflection model

We present a systematic study of GX 339-4 in both its very high and low hard states from simultaneous observations made with XMM-Newton and RXTE in 2002 and 2004. The X-ray spectra of both these extreme states exhibit strong reflection signatures, with a broad, skewed Fe-Kalpha line clearly visible above the continuum. Using a newly developed, self-consistent reflection model which implicitly includes the blackbody radiation of the disc as well as the effect of Comptonisation, blurred with a relativistic line function, we were able to infer the spin parameter of GX 339-4 to be 0.935 +/- 0.01 (statistical) +/- 0.01 (systematic) at 90 per cent confidence. We find that both states are consistent with an ionised thin accretion disc extending to the innermost stable circular orbit around the rapidly spinning black hole.Comment: 10 pages, 10 figures, accepted for publication in MNRAS 17/04/0

Graphical Methods in Device-Independent Quantum Cryptography

We introduce a framework for graphical security proofs in device-independent quantum cryptography using the methods of categorical quantum mechanics. We are optimistic that this approach will make some of the highly complex proofs in quantum cryptography more accessible, facilitate the discovery of new proofs, and enable automated proof verification. As an example of our framework, we reprove a previous result from device-independent quantum cryptography: any linear randomness expansion protocol can be converted into an unbounded randomness expansion protocol. We give a graphical proof of this result, and implement part of it in the Globular proof assistant.Comment: Publishable version. Diagrams have been polished, minor revisions to the text, and an appendix added with supplementary proof