Essays on the Modeling and Prediction of Volatility and Higher Moments of Stock Returns (summary section only)

One of the most fundamental and widely accepted ideas in finance is that investors are compensated through higher returns for taking on non-diversifiable risk. Hence the quantification, modeling and prediction of risk have been, and still are one of the most prolific research areas in financial economics. It was recognized early on that there are predictable patterns in the variance of speculative prices. Later research has shown that there may also be systematic variation in the skewness and kurtosis of financial returns. Lacking in the literature so far, is an out-of-sample forecast evaluation of the potential benefits of these new more complicated models with time-varying higher moments. Such an evaluation is the topic of this dissertation. Essay 1 investigates the forecast performance of the GARCH (1,1) model when estimated with 9 different error distributions on Standard and Poor’s 500 Index Future returns. By utilizing the theory of realized variance to construct an appropriate ex post measure of variance from intra-day data it is shown that allowing for a leptokurtic error distribution leads to significant improvements in variance forecasts compared to using the normal distribution. This result holds for daily, weekly as well as monthly forecast horizons. It is also found that allowing for skewness and time variation in the higher moments of the distribution does not further improve forecasts. In Essay 2, by using 20 years of daily Standard and Poor 500 index returns, it is found that density forecasts are much improved by allowing for constant excess kurtosis but not improved by allowing for skewness. By allowing the kurtosis and skewness to be time varying the density forecasts are not further improved but on the contrary made slightly worse. In Essay 3 a new model incorporating conditional variance, skewness and kurtosis based on the Normal Inverse Gaussian (NIG) distribution is proposed. The new model and two previously used NIG models are evaluated by their Value at Risk (VaR) forecasts on a long series of daily Standard and Poor’s 500 returns. The results show that only the new model produces satisfactory VaR forecasts for both 1% and 5% VaR Taken together the results of the thesis show that kurtosis appears not to exhibit predictable time variation, whereas there is found some predictability in the skewness. However, the dynamic properties of the skewness are not completely captured by any of the models.

Nonverbal predication in Erzya : Studies on morphosyntactic variation and part of speech distinctions

This dissertation consists of four articles and an introduction. The five parts address the same topic, nonverbal predication in Erzya, from different perspectives. The work is at the same time linguistic typology and Uralic studies. The findings based on a large corpus of empirical Erzya data, which was collected using several different methods and included recordings of the spoken language, made it possible for the present study to apply, then test and finally discuss the previous theories based on cross-linguistic data. Erzya makes use of multiple predication patterns which vary from totally analytic to the morphologically very complex. Nonverbal predicate clause types are classified on the basis of propositional acts in clauses denoting class-membership, identity, property and location. The predicates of these clauses are nouns, adjectives and locational expressions, respectively. The following three predication strategies in Erzya nonverbal predication can be identified: i. the zero-copula construction, ii. the predicative suffix construction and iii. the copula construction. It has been suggested that verbs and nouns cannot be clearly distinguished on morphological grounds when functioning as predicates in Erzya. This study shows that even though predicativity must not be considered a sufficient tool for defining parts of speech in any language, the Erzya lexical classes of adjective, noun and verb can be distinguished from each other also in predicate position. The relative frequency and degree of obligation for using the predicative suffix construction decreases when moving left to right on the scale verb adjective/locative noun ( identificational statement). The predicative suffix is the main pattern in the present tense over the whole domain of nonverbal predication in Standard Erzya, but if it is replaced it is most likely to be with a zero-copula construction in a nominal predication. This study exploits the theory of (a)symmetry for the first time in order to describe verbal vs. nonverbal predication. It is shown that the asymmetry of paradigms and constructions differentiates the lexical classes. Asymmetrical structures are motivated by functional level asymmetry. Variation in predication as such adds to the complexity of the grammar. When symmetric structures are employed, the functional complexity of grammar decreases, even though morphological complexity increases. The genre affects the employment of predication strategies in Erzya. There are differences in the relative frequency of the patterns, and some patterns are totally lacking from some of the data. The clearest difference is that the past tense predicative suffix construction occurs relatively frequently in Standard Erzya, while it occurs infrequently in the other data. Also, the predicative suffixes of the present tense are used more regularly in written Standard Erzya than in any other genre. The genre also affects the incidence of the translative in uľ(ń)ems copula constructions. In translations from Russian to Erzya the translative case is employed relatively frequently in comparison to other data. This study reveals differences between the two Mordvinic languages Erzya and Moksha. The predicative suffixes (bound person markers) of the present tense are used more regularly in Moksha in all kinds of nonverbal predicate clauses compared to Erzya. It should further be observed that identificational statements are encoded with a predicative suffix in Moksha, but seldom in Erzya. Erzya clauses are more frequently encoded using zero-constructions, displaying agreement in number only.

Prevention of type 2 diabetes with lifestyle intervention - emphasis on dietary composition and identification of high-risk individuals

Type 2 diabetes is an increasing, serious, and costly public health problem. The increase in the prevalence of the disease can mainly be attributed to changing lifestyles leading to physical inactivity, overweight, and obesity. These lifestyle-related risk factors offer also a possibility for preventive interventions. Until recently, proper evidence regarding the prevention of type 2 diabetes has been virtually missing. To be cost-effective, intensive interventions to prevent type 2 diabetes should be directed to people at an increased risk of the disease. The aim of this series of studies was to investigate whether type 2 diabetes can be prevented by lifestyle intervention in high-risk individuals, and to develop a practical method to identify individuals who are at high risk of type 2 diabetes and would benefit from such an intervention. To study the effect of lifestyle intervention on diabetes risk, we recruited 522 volunteer, middle-aged (aged 40 - 64 at baseline), overweight (body mass index > 25 kg/m2) men (n = 172) and women (n = 350) with impaired glucose tolerance to the Diabetes Prevention Study (DPS). The participants were randomly allocated either to the intensive lifestyle intervention group or the control group. The control group received general dietary and exercise advice at baseline, and had annual physician's examination. The participants in the intervention group received, in addition, individualised dietary counselling by a nutritionist. They were also offered circuit-type resistance training sessions and were advised to increase overall physical activity. The intervention goals were to reduce body weight (5% or more reduction from baseline weight), limit dietary fat (< 30% of total energy consumed) and saturated fat (< 10% of total energy consumed), and to increase dietary fibre intake (15 g / 1000 kcal or more) and physical activity (≥ 30 minutes/day). Diabetes status was assessed annually by a repeated 75 g oral glucose tolerance testing. First analysis on end-points was completed after a mean follow-up of 3.2 years, and the intervention phase was terminated after a mean duration of 3.9 years. After that, the study participants continued to visit the study clinics for the annual examinations, for a mean of 3 years. The intervention group showed significantly greater improvement in each intervention goal. After 1 and 3 years, mean weight reductions were 4.5 and 3.5 kg in the intervention group and 1.0 kg and 0.9 kg in the control group. Cardiovascular risk factors improved more in the intervention group. After a mean follow-up of 3.2 years, the risk of diabetes was reduced by 58% in the intervention group compared with the control group. The reduction in the incidence of diabetes was directly associated with achieved lifestyle goals. Furthermore, those who consumed moderate-fat, high-fibre diet achieved the largest weight reduction and, even after adjustment for weight reduction, the lowest diabetes risk during the intervention period. After discontinuation of the counselling, the differences in lifestyle variables between the groups still remained favourable for the intervention group. During the post-intervention follow-up period of 3 years, the risk of diabetes was still 36% lower among the former intervention group participants, compared with the former control group participants. To develop a simple screening tool to identify individuals who are at high risk of type 2 diabetes, follow-up data of two population-based cohorts of 35-64 year old men and women was used. The National FINRISK Study 1987 cohort (model development data) included 4435 subjects, with 182 new drug-treated cases of diabetes identified during ten years, and the FINRISK Study 1992 cohort (model validation data) included 4615 subjects, with 67 new cases of drug-treated diabetes during five years, ascertained using the Social Insurance Institution's Drug register. Baseline age, body mass index, waist circumference, history of antihypertensive drug treatment and high blood glucose, physical activity and daily consumption of fruits, berries or vegetables were selected into the risk score as categorical variables. In the 1987 cohort the optimal cut-off point of the risk score identified 78% of those who got diabetes during the follow-up (= sensitivity of the test) and 77% of those who remained free of diabetes (= specificity of the test). In the 1992 cohort the risk score performed equally well. The final Finnish Diabetes Risk Score (FINDRISC) form includes, in addition to the predictors of the model, a question about family history of diabetes and the age category of over 64 years. When applied to the DPS population, the baseline FINDRISC value was associated with diabetes risk among the control group participants only, indicating that the intensive lifestyle intervention given to the intervention group participants abolished the diabetes risk associated with baseline risk factors. In conclusion, the intensive lifestyle intervention produced long-term beneficial changes in diet, physical activity, body weight, and cardiovascular risk factors, and reduced diabetes risk. Furthermore, the effects of the intervention were sustained after the intervention was discontinued. The FINDRISC proved to be a simple, fast, inexpensive, non-invasive, and reliable tool to identify individuals at high risk of type 2 diabetes. The use of FINDRISC to identify high-risk subjects, followed by lifestyle intervention, provides a feasible scheme in preventing type 2 diabetes, which could be implemented in the primary health care system.

Sweet potato chlorotic stunt virus: Studies on viral synergism and suppression of RNA silencing

The studies presented in this thesis aimed to a better understanding of the molecular biology of Sweet potato chlorotic stunt virus (SPCSV, Crinivirus, Closteroviridae) and its role in the development of synergistic viral diseases. The emphasis was on the severe sweet potato virus disease (SPVD) that results from a synergistic interaction of SPCSV and Sweet potato feathery mottle virus (SPFMV, Potyvirus, Potyviridae). SPVD is the most important disease affecting sweetpotato. It is manifested as a significant increase in symptom severity and SPFMV titres. This is accompanied by a dramatic sweetpotato yield reduction. SPCSV titres remain little affected in the diseased plants. Viral synergistic interactions have been associated with the suppression of an adaptive general defence mechanism discovered in plants and known as RNA silencing. In the studies of this thesis two novel proteins (RNase3 and p22) identified in the genome of a Ugandan SPCSV isolate were shown to be involved in suppression of RNA silencing. RNase3 displayed a dsRNA-specific endonuclease activity that enhanced the RNA-silencing suppression activity of p22. Comparative analyses of criniviral genomes revealed variability in the gene content at the 3´end of the genomic RNA1. Molecular analyses of different isolates of SPCSV indicated a marked intraspecific heterogeneity in this region where the p22 and RNase3 genes are located. Isolates of the East African strain of SPCSV from Tanzania and Peru and an isolate from Israel were missing a 767-nt fragment that included the p22 gene. However, regardless of the absence of p22, all SPCSV isolates acted synergistically with SPFMV in co-infected sweetpotato, enhanced SPFMV titres and caused SPVD. These results showed that p22 is dispensable for development of SPVD. The role of RNase3 in SPVD was then studied by generating transgenic plants expressing the RNase3 protein. These plants had increased titres of SPFMV (ca. 600-fold higher in comparison with nontransgenic plants) 2-3 weeks after graft inoculation and displayed the characteristic SPVD symptoms. RNA silencing suppression (RSS) activity of RNase3 was detected in agroinfiltrated leaves of Nicotiana bethamiana. In vitro studies showed that RNase3 was able to cleave small interferring RNAs (siRNA) to products of ~14-nt. The data thus identified RNase3 as a suppressor of RNA silencing able to cleave siRNAs. RNase3 expression alone was sufficient for breaking down resistance to SPFMV in sweetpotato and for the development of SPVD. Similar RNase III-like genes exist in animal viruses which points out a novel and possibly more general mechanism of RSS by viruses. A reproducible method of sweetpotato transformation was used to target RNA silencing against the SPCSV polymerase region (RdRp) with an intron-spliced hairpin construct. Hence, engineered resistance to SPCSV was obtained. Ten out of 20 transgenic events challenged with SPCSV alone showed significantly reduced virus titres. This was however not sufficient to prevent SPVD upon coinfection with SPFMV. Immunity to SPCSV seems to be required to control SPVD and targeting of different SPCSV regions need to be assessed in further studies. Based on the identified key role of RNase3 in SPVD the possibility to design constructs that target this gene might prove more efficient in future studies.

Influence of harvesting strategy on nutrient supply and production of dairy cows consuming diets based on grass and red clover silage

The main objective of this thesis was to elucidate the effects of regrowth grass silage and red clover silage on nutrient supply and milk production of dairy cows as compared with primary growth grass silages. In the first experiment (publication I), two primary growth and four regrowth grass silages were harvested at two stages of growth. These six silages were fed to 24 lactating dairy cows with two levels of concentrate allowance. Silage intake and energy corrected milk yield (ECM) responses, and the range in these response variables between the diets, were smaller when regrowth silages rather than primary growth silages were fed. Milk production of dairy cows reflected the intake of metabolizable energy (ME), and no differences in the ME utilization were found between the diets based on silages harvested from primary growth and regrowth. The ECM response to increased concentrate allowance was, on average, greater when regrowth rather than primary growth silages were fed. In the second experiment (publication II), two silages from primary growth and two from regrowth used in I were fed to rumen cannulated lactating dairy cows. Cows consumed less feed dry matter (DM), energy and protein, and produced less milk, when fed diets based on regrowth silages rather than primary growth silages. Lower milk production responses of regrowth grass silage diets were mainly due to the lower silage DM intake, and could not be accounted for by differences in energy or protein utilization. Regrowth grass silage intake was not limited due to neutral detergent fibre (NDF) digestion or rumen fill or passage kinetics. However, lower intake may be at least partly attributable to plant diseases such as leaf spot infections, dead deteriorating material or abundance of weeds, which are all higher in regrowth compared with primary growth, and increase with advancing regrowth. In the third experiment (publications III and IV), red clover silages and grass silages harvested at two stages of growth, and a mixed diet of red clover and grass silages, were fed to five rumen cannulated lactating dairy cows. In spite of the lower average ME intake for red clover diets, the ECM production remained unchanged suggesting more efficient utilisation of ME for red clover diets compared with grass diets. Intake of N, and omasal canal flows of total non-ammonia N (NAN), microbial and non-microbial NAN were higher for red clover than for grass silage diets, but were not affected by forage maturity. Delaying the harvest tended to decrease DM intake of grass silage and increase that of red clover silage. The digestion rate of potentially digestible NDF was faster for red clover diets than for grass silage diets. Delaying the harvest decreased the digestion rate for grass but increased it for red clover silage diets. The low intake of early-cut red clover silage could not be explained by silage digestibility, fermentation quality, or rumen fill but was most likely related to the nutritionally suboptimal diet composition because inclusion of moderate quality grass silage in mixed diet increased silage DM intake. Despite the higher total amino acid supply of cows fed red clover versus grass silage diets, further milk production responses on red clover diets were possibly compromised by an inadequate supply of methionine as evidenced by lower methionine concentration in the amino acid profile of omasal digesta and plasma. Increasing the maturity of ensiled red clover does not seem to affect silage DM intake as consistently as that of grasses. The efficiency of N utilization for milk protein synthesis was lower for red clover diets than for grass diets. It was negatively related to diet crude protein concentration similarly to grass silage diets.

Group Beliefs : Studies on the Nature and Logic of Collective Doxastic Attitudes

This thesis studies the nature and logic of collective doxastic attitudes, or what is referred to in ordinary language as "group beliefs". Beliefs and other intentional attitudes are attributed to groups and collections of people, and such attributions are used to explain and predict the actions of groups. The thesis develops an understanding of group beliefs as voluntarily adopted views or acceptances rather than as ordinary beliefs. Such an understanding can provide new answers to questions concerning collective knowledge and justification of group beliefs, and it allows developing modal logics with collective doxastic and epistemic notions. The thesis consists of six articles. The first three articles are philosophical studies concerned with the nature of group beliefs. The last three articles are logical studies that aim at developing proof-theoretical calculi for reasoning about collective doxastic attitudes.

The effects of abiotic and biotic factors on somatic embryogenesis and seedlings of Pinus sylvestris (L.)

Somatic embryogenesis (SE) is an asexual form of plant propagation that occurs in nature and mimics many of the events of sexual reproduction. Pinus sylvestris (L.) is an important source of timber in Northern Eurasia but it is recalcitrant to somatic embryogenesis. Several factors important for the success of the P. sylvestris embryogenic cultures have not been thoroughly investigated. In this study, we examined the effects of parental genotypes on the SE in P. sylvestris, the involvement of the gaseous plant growth regulator, ethylene in SE, and also biotic effects on somatic embryos as well as on seedlings. We tested parental effects on immature embryo initiation for different media, storage periods, and on the maturation process. Maternal effects were found to be crucial for SE in the absence of paternal effects. No maternal-paternal interaction was observed at any stage of somatic embryo production. Additionally the role of ethylene at different developmental stages of SE was investigated. Two ACC synthase genes, PsACS1 and PsACS2, were isolated and characterized. PsACS1 was expressed during the proliferation stage in all tested genotypes, whereas PsACS2 was only expressed in somatic embryos of each genotype. Ethylene production in embryos at stage 3 was significantly higher than the other stages. In a parallel study, the response of somatic embryos to fungal elicitors was investigated. Three fungi, a mutualistic ectomycorrhizal (ECM) fungus (Suillus bovinus), a weak Scots pine pathogen (Heterobasidion parviporum) and a strong pathogen (H. annosum) were used. The gene expression patterns for embryos exposed to the H. parviporum elicitor were found to be similar to that documented for S. bovinus among the tested genes. By contrast somatic embryos exposed to the H. annosum elicitor had a different pattern of regulation which was marked by a delayed response, and in some cases death of the embryos. Furthermore, interaction without direct contact between P. sylvestris seedlings and microbes (mutualistic and pathogenic fungus, cyanobacterium) were investigated. Several novel genes expressed in seedlings treated with ECM fungus were isolated which suggested that physical contact is not necessary for elicitation of host responses. The results suggest that somatic embryos and seedlings of P. sylvestris are genetically well equipped to respond to fungal elicitor/exudates and could serve as a suitable model for reproducible molecular studies in conifer tree patho- and symbiotic systems.

Essays on the Costs and Benefits of Large Shareholders in Corporate Governance (summary section only)

“Corporate governance deals with the ways in which suppliers of finance to firms assure themselves of getting a return on their investment” (Shleifer and Vishny (1997, p. 737). According to La Porta et al. (1999), research in corporate finance relevant for most countries should focus on the incentives and capabilities of controlling shareholders to treat themselves preferentially at the expense of minority shareholders. Accordingly, this thesis sets out to answer a number of research questions regarding the role of large shareholders in public firms that have received little attention in the literature so far. A common theme in the essays stems from the costs and benefits of individual large-block owners and the role of control contestability from the perspective of outside minority shareholders. The first essay empirically examines whether there are systematic performance differences between family controlled and nonfamily controlled firms in Western Europe. In contrast to the widely held view that family control penalizes firm value, the essay shows that publicly traded family firms have higher performance than comparable firms. In the second essay, we present both theoretical and empirical analysis on the effects of control contestability on firm valuation. Consistent with the theoretical model, the empirical results show that minority shareholders benefit from a more contestable control structure. The third essay explores the effects of individual large-block owners on top management turnover and board appointments in Finnish listed firms. The results indicate that firm performance is an important determinant for management and board restructurings. For certain types of turnover decisions the corporate governance structure influences the performance / turnover sensitivity. In the fourth essay, we investigate the relation between the governance structure and dividend policy in Finnish listed firms. We find evidence in support of the outcome agency model of dividends stating that lower agency conflicts should be associated with higher dividend payouts.