On the measurement of frequency and of its sample variance with high-resolution counters

A frequency counter measures the input frequency $\bar{\nu}$ averaged over a suitable time $\tau$, versus the reference clock. High resolution is achieved by interpolating the clock signal. Further increased resolution is obtained by averaging multiple frequency measurements highly overlapped. In the presence of additive white noise or white phase noise, the square uncertainty improves from $\smash{\sigma^2_\nu\propto1/\tau^2}$ to $\smash{\sigma^2_\nu\propto1/\tau^3}$. Surprisingly, when a file of contiguous data is fed into the formula of the two-sample (Allan) variance $\smash{\sigma^2_y(\tau)=\mathbb{E}\{\frac12(\bar{y}_{k+1}-\bar{y}_k) ^2\}}$ of the fractional frequency fluctuation $y$, the result is the \emph{modified} Allan variance mod $\sigma^2_y(\tau)$. But if a sufficient number of contiguous measures are averaged in order to get a longer $\tau$ and the data are fed into the same formula, the results is the (non-modified) Allan variance. Of course interpretation mistakes are around the corner if the counter internal process is not well understood.Comment: 14 pages, 5 figures, 1 table, 18 reference

Probing the massive star forming environment - a multiwavelength investigation of the filamentary IRDC G333.73+0.37

We present a multiwavelength study of the filamentary infrared dark cloud (IRDC) G333.73+0.37. The region contains two distinct mid-infrared sources S1 and S2 connected by dark lanes of gas and dust. Cold dust emission from the IRDC is detected at seven wavelength bands and we have identified 10 high density clumps in the region. The physical properties of the clumps such as temperature: 14.3-22.3 K and mass: 87-1530 M_sun are determined by fitting a modified blackbody to the spectral energy distribution of each clump between 160 micron and 1.2 mm. The total mass of the IRDC is estimated to be $~4700 M_sun. The molecular line emission towards S1 reveals signatures of protostellar activity. Low frequency radio emission at 1300 and 610 MHz is detected towards S1 (shell-like) and S2 (compact morphology), confirming the presence of newly formed massive stars in the IRDC. Photometric analysis of near and mid-infrared point sources unveil the young stellar object population associated with the cloud. Fragmentation analysis indicates that the filament is supercritical. We observe a velocity gradient along the filament, that is likely to be associated with accretion flows within the filament rather than rotation. Based on various age estimates obtained for objects in different evolutionary stages, we attempt to set a limit to the current age of this cloud.Comment: 26 pages, 20 figures, accepted by Ap

How organizational hierarchy affects information production

We exploit a variation in organizational hierarchy induced by a reorganization plan implemented in roughly 2,000 bank branches in India. We do so to investigate how organizational hierarchy affects the allocation of credit. We find that increased hierarchization of a branch induces credit rationing, reduces loan performance, and generates standardization in loan contracts. Additionally, we find that hierarchical structures perform better in environments characterized by a high degree of corruption, highlighting the benefits of hierarchies in restraining rent-seeking activities. Overall, our results are consistent with the view that valuable information may be lost in hierarchical structures

Rent Seeking in Elite Networks

We employ a unique dataset on members of an elite service club in Germany to investigate how social connections in elite networks affect the allocation of resources. Specifically, we investigate credit allocation decisions of banks to firms inside the network. Using a quasi-experimental research design, we document misallocation of bank credit inside the network, with bankers with weakly aligned incentives engaging most actively in crony lending. Our findings, thus, resonate with existing theories of elite networks as rent extractive coalitions that stifle economic prosperity

Leveraged buyouts and bond credit spreads

Recent decades have witnessed several waves of buyout activity. We find leveraged buyouts (LBOs) to be a significant concern for bondholders by showing that a) intra-industry credit spreads increase upon an LBO announcement, b) yields on bonds without event risk covenants are, on average, 21 basis points higher than those on same-firm bonds with such covenants, and c) structural models calibrated to historical LBO events imply an impact of 18–21 basis points on 10-year credit spreads. The impact is strongest in expansion periods and for bonds with maturities of 10–20 years

Information, Credit, and Organization

This paper investigates the effect of a change in informational environment of borrowers on the organizational design of bank lending. We use micro-data from a large multinational bank and exploit the sudden introduction of a credit registry, an information-sharing mechanism across banks, for a subset of borrowers. Using within borrower and loan officer variation in a difference-in-difference empirical design, we show that expansion of credit registry led to an improvement in allocation of credit to affected borrowers. There was a concurrent change in the organizational structure of the bank that involved a dramatic increase in delegation of lending decisions of affected borrowers to loan officers. We also find a significant expansion in scope of activities of loan officers who deal primarily with affected borrowers, as well as of their superiors. There is suggestive evidence that larger banks in the economy were better able to implement similar changes as our bank. We argue that these patterns can be understood within the framework of incentive-based and information cost processing theories. Our findings could help rationalize why improvements in the information environment of borrowers may be altering the landscape of lending by moving decisions outside the boundaries of financial intermediaries

The limits of model-based regulation

Using loan-level data from Germany, we investigate how the introduction of model-based capital regulation affected banks’ ability to absorb shocks. The objective of this regulation was to enhance financial stability by making capital requirements responsive to asset risk. Our evidence suggests that banks ‘optimized’ model-based regulation to lower their capital requirements. Banks systematically underreported risk, with underreporting being more pronounced for banks with higher gains from it. Moreover, large banks benefitted from the regulation at the expense of smaller banks. Overall, our results suggest that sophisticated rules may have undesired effects if strategic misbehavior is difficult to detect