More on Bernanke's “Bad News Principle”

The role that Bernanke’s Bad News Principle plays in the modern theory of investment under uncertainty is analyzed. The analysis shows that the actual investment dilemma is that by delaying investment firms trade off a higher present value of earnings for a lower present value of the investment cost, in contrast to previous interpretations of this dilemma. The economic interpretation of the Smooth Pasting Condition is clarified too: it represents the trade-off mentioned above. I also show that investment triggers may stay intact despite changes in the profit process, if the changes are restricted to the range of sufficiently high profits.Investment, Uncertainty, Option Value, Competition

Lags, Convexity and the Investment-Uncertainty Relationship

The effect that investment lags has on the uncertainty-investment relationship is studied by modifying the Bar-Ilan and Strange (1996) model in a manner that enables analytical solution. It turns out that: (i) If the time lag is sufficiently small, uncertainty affects investment negatively; (ii) A sufficiently large time lag engenders an inverse u-shape relationship between the degree of uncertainty and the profit level that triggers investment; (iii) When such an inverse u- shape exists, the higher is the length of the time lag (or the degree of profit convexity) the wider is the range of a positive uncertainty- investment relationship.Investment, Uncertainty, Time to build

WOMEN’S LABOR FORCE PARTICIPATION AND THE DYNAMICS OF TRADITION

We present a model in which the social norms regarding women’s labor force participation (LFP) differ from the norms concerning men’s. Assuming that these norms depend on past rates of women LFP creates a gradual increase in women LFP.

The Baby Boom and World War II: The Role of Labor Market Experience

The past century has witnessed major changes in the economic choices of American women. Over the long term, there has been a marked trend towards lower fertility and higher female labor force participation. However, change did not occur in a uniform fashion: during the post-war Baby Boom, fertility rates increased substantially, until the long-term downward trend reestablished itself in the 1960s. Similarly, the labor market participation of younger women declined for a while during the same period. What can explain these reversals? In this paper, we propose a joint explanation for these changes through a single shock: the demand for female labor during World War II. Many of the women of the war generation continued to work after the war. We argue that this crowded out younger women from the labor market, who chose to have more children instead.

Entry and exit under uncertainty in the presence of drift

ing the results of Kongsted (1996) in the analysis in Dixit (1989) shows that the negative effect of uncertainty on entry and exit is maximal in the absence of drift.

A survey for large image-separation lensed quasars

The statistics of gravitationally lensed quasars with multiple images in the 0.1''-7'' range have been measured in various surveys. Little is known, however, about lensed-quasar statistics at larger image separations, which probe masses on the scale of galaxy clusters. We extend the results of the HST Snapshot Survey for Lensed Quasars to the 7''-50'' range for a sub-sample of 76 quasars that is free of known selection effects. Using a combination of multicolor photometry and spectroscopy, we show that none of the point sources in the entire field of view of the HST observations of these quasars are lensed images. Large-separation quasar lensing is therefore not common. We carry out a detailed calculation of the expected statistics of large-separation lensing for this quasar sample, incorporating realistic input for the mass profiles and mass function of galaxy clusters. We find that the observational null results are consistent with the expected effect of galaxy clusters, even if these have existed in their present form and number since z of about 2. The rarity of large-separation lensed quasars can rule out some extreme scenarios, e.g. that the mass-function of clusters has been severely underestimated, or that large mass concentrations that are not associated with galaxies (i.e. ``failed'' clusters) are common. The rareness of wide lensing also sets limits on the cosmological constant that are independent of limits derived from galaxy lensing. The lensing statistics of larger quasar samples can probe the structure, number, and evolution of clusters, as well as the geometry of space.Comment: LaTex, ApJ, submitte

The delay-time distribution of type-Ia supernovae from Sloan II

We derive the delay-time distribution (DTD) of type-Ia supernovae (SNe Ia) using a sample of 132 SNe Ia, discovered by the Sloan Digital Sky Survey II (SDSS2) among 66,000 galaxies with spectral-based star-formation histories (SFHs). To recover the best-fit DTD, the SFH of every individual galaxy is compared, using Poisson statistics, to the number of SNe that it hosted (zero or one), based on the method introduced in Maoz et al. (2011). This SN sample differs from the SDSS2 SN Ia sample analyzed by Brandt et al. (2010), using a related, but different, DTD recovery method. Furthermore, we use a simulation-based SN detection-efficiency function, and we apply a number of important corrections to the galaxy SFHs and SN Ia visibility times. The DTD that we find has 4-sigma detections in all three of its time bins: prompt (t < 420 Myr), intermediate (0.4 2.4 Gyr), indicating a continuous DTD, and it is among the most accurate and precise among recent DTD reconstructions. The best-fit power-law form to the recovered DTD is t^(-1.12+/-0.08), consistent with generic ~t^-1 predictions of SN Ia progenitor models based on the gravitational-wave induced mergers of binary white dwarfs. The time integrated number of SNe Ia per formed stellar mass is N_SN/M = 0.00130 +/- 0.00015 Msun^-1, or about 4% of the stars formed with initial masses in the 3-8 Msun range. This is lower than, but largely consistent with, several recent DTD estimates based on SN rates in galaxy clusters and in local-volume galaxies, and is higher than, but consistent with N_SN/M estimated by comparing volumetric SN Ia rates to cosmic SFH.Comment: MNRAS, in pres

Reverberation Mapping and the Physics of Active Galactic Nuclei

Reverberation-mapping campaigns have revolutionized our understanding of AGN. They have allowed the direct determination of the broad-line region size, enabled mapping of the gas distribution around the central black hole, and are starting to resolve the continuum source structure. This review describes the recent and successful campaigns of the International AGN Watch consortium, outlines the theoretical background of reverberation mapping and the calculation of transfer functions, and addresses the fundamental difficulties of such experiments. It shows that such large-scale experiments have resulted in a ``new BLR'' which is considerably different from the one we knew just ten years ago. We discuss in some detail the more important new results, including the luminosity-size-mass relationship for AGN, and suggest ways to proceed in the near future.Comment: Review article to appear in Astronomical Time Series, Proceedings of the Wise Observatory 25th Ann. Symposium. 24 pages including 7 figure