Community, Power, and Colonialism: The U.S. Army in Southern Arizona and New Mexico, 1866-1886

Empire is central to U.S. history. When we see the U.S. projecting its influence on a global scale in today s world it is important to understand that U.S. empire has a long history. This dissertation offers a case study of colonialism and U.S. empire by discussing the social worlds, labor regimes, and culture of the U.S. Army during the conquest of southern Arizona and New Mexico (1866-1886). It highlights some of the defining principles, mentalities, and characteristics of U.S. imperialism and shows how U.S. forces have in years past constructed their power and represented themselves, their missions, and the places and peoples that faced U.S. imperialism/colonialism. Using insights from postcolonial studies and whiteness studies, this work balances its attention between discursive representations (army stories) and social experience (army actions), pays attention to silences in the process of historical production, and focuses on collective group mentalities and identities. In the end the army experience reveals an empire in denial constructed on the rule of difference and marked by frustration. White officers, their wives, and the white enlisted men not only wanted the monopoly of violence for the U.S. regime but also colonial (mental/cultural) authority and power, and constructed their identity, authority, and power in discourse and in the social contexts of the everyday through difference. Engaged in warfare against the Apaches, they did not recognize their actions as harmful or acknowledge the U.S. invasion as the bloody colonial conquest it was. White army personnel painted themselves and the army as liberators, represented colonial peoples as racial inferiors, approached colonial terrain in terms of struggle, and claimed that the region was a terrible periphery with little value before the arrival of white civilization. Officers and wives also wanted to place themselves at the top of colonial hierarchies as the refined and respectable class who led the regeneration of the colony by example: they tried to turn army villages into islands of civilization and made journeys, leisure, and domestic life to showcase their class sensibilities and level of sophistication. Often, however, their efforts failed, resulting in frustration and bitterness. Many blamed the colony and its peoples for their failures. The army itself was divided by race and class. All soldiers were treated as laborers unfit for self-government. White enlisted men, frustrated by their failures in colonial warfare and by constant manual labor, constructed worlds of resistance, whereas indigenous soldiers sought to negotiate the effects of colonialism by working in the army. As colonized labor their position was defined by tension between integration and exclusion and between freedom and colonial control.

The Spin-Statistics Relation and Noncommutative Quantum Field Theory

The efforts of combining quantum theory with general relativity have been great and marked by several successes. One field where progress has lately been made is the study of noncommutative quantum field theories that arise as a low energy limit in certain string theories. The idea of noncommutativity comes naturally when combining these two extremes and has profound implications on results widely accepted in traditional, commutative, theories. In this work I review the status of one of the most important connections in physics, the spin-statistics relation. The relation is deeply ingrained in our reality in that it gives us the structure for the periodic table and is of crucial importance for the stability of all matter. The dramatic effects of noncommutativity of space-time coordinates, mainly the loss of Lorentz invariance, call the spin-statistics relation into question. The spin-statistics theorem is first presented in its traditional setting, giving a clarifying proof starting from minimal requirements. Next the notion of noncommutativity is introduced and its implications studied. The discussion is essentially based on twisted Poincaré symmetry, the space-time symmetry of noncommutative quantum field theory. The controversial issue of microcausality in noncommutative quantum field theory is settled by showing for the first time that the light wedge microcausality condition is compatible with the twisted Poincaré symmetry. The spin-statistics relation is considered both from the point of view of braided statistics, and in the traditional Lagrangian formulation of Pauli, with the conclusion that Pauli's age-old theorem stands even this test so dramatic for the whole structure of space-time.

Geospatial environmental data modelling applications using remote sensing, GIS and spatial statistics

This thesis presents novel modelling applications for environmental geospatial data using remote sensing, GIS and statistical modelling techniques. The studied themes can be classified into four main themes: (i) to develop advanced geospatial databases. Paper (I) demonstrates the creation of a geospatial database for the Glanville fritillary butterfly (Melitaea cinxia) in the Åland Islands, south-western Finland; (ii) to analyse species diversity and distribution using GIS techniques. Paper (II) presents a diversity and geographical distribution analysis for Scopulini moths at a world-wide scale; (iii) to study spatiotemporal forest cover change. Paper (III) presents a study of exotic and indigenous tree cover change detection in Taita Hills Kenya using airborne imagery and GIS analysis techniques; (iv) to explore predictive modelling techniques using geospatial data. In Paper (IV) human population occurrence and abundance in the Taita Hills highlands was predicted using the generalized additive modelling (GAM) technique. Paper (V) presents techniques to enhance fire prediction and burned area estimation at a regional scale in East Caprivi Namibia. Paper (VI) compares eight state-of-the-art predictive modelling methods to improve fire prediction, burned area estimation and fire risk mapping in East Caprivi Namibia. The results in Paper (I) showed that geospatial data can be managed effectively using advanced relational database management systems. Metapopulation data for Melitaea cinxia butterfly was successfully combined with GPS-delimited habitat patch information and climatic data. Using the geospatial database, spatial analyses were successfully conducted at habitat patch level or at more coarse analysis scales. Moreover, this study showed it appears evident that at a large-scale spatially correlated weather conditions are one of the primary causes of spatially correlated changes in Melitaea cinxia population sizes. In Paper (II) spatiotemporal characteristics of Socupulini moths description, diversity and distribution were analysed at a world-wide scale and for the first time GIS techniques were used for Scopulini moth geographical distribution analysis. This study revealed that Scopulini moths have a cosmopolitan distribution. The majority of the species have been described from the low latitudes, sub-Saharan Africa being the hot spot of species diversity. However, the taxonomical effort has been uneven among biogeographical regions. Paper III showed that forest cover change can be analysed in great detail using modern airborne imagery techniques and historical aerial photographs. However, when spatiotemporal forest cover change is studied care has to be taken in co-registration and image interpretation when historical black and white aerial photography is used. In Paper (IV) human population distribution and abundance could be modelled with fairly good results using geospatial predictors and non-Gaussian predictive modelling techniques. Moreover, land cover layer is not necessary needed as a predictor because first and second-order image texture measurements derived from satellite imagery had more power to explain the variation in dwelling unit occurrence and abundance. Paper V showed that generalized linear model (GLM) is a suitable technique for fire occurrence prediction and for burned area estimation. GLM based burned area estimations were found to be more superior than the existing MODIS burned area product (MCD45A1). However, spatial autocorrelation of fires has to be taken into account when using the GLM technique for fire occurrence prediction. Paper VI showed that novel statistical predictive modelling techniques can be used to improve fire prediction, burned area estimation and fire risk mapping at a regional scale. However, some noticeable variation between different predictive modelling techniques for fire occurrence prediction and burned area estimation existed.

Finitary Abstract Elementary Classes

The research in model theory has extended from the study of elementary classes to non-elementary classes, i.e. to classes which are not completely axiomatizable in elementary logic. The main theme has been the attempt to generalize tools from elementary stability theory to cover more applications arising in other branches of mathematics. In this doctoral thesis we introduce finitary abstract elementary classes, a non-elementary framework of model theory. These classes are a special case of abstract elementary classes (AEC), introduced by Saharon Shelah in the 1980's. We have collected a set of properties for classes of structures, which enable us to develop a 'geometric' approach to stability theory, including an independence calculus, in a very general framework. The thesis studies AEC's with amalgamation, joint embedding, arbitrarily large models, countable Löwenheim-Skolem number and finite character. The novel idea is the property of finite character, which enables the use of a notion of a weak type instead of the usual Galois type. Notions of simplicity, superstability, Lascar strong type, primary model and U-rank are inroduced for finitary classes. A categoricity transfer result is proved for simple, tame finitary classes: categoricity in any uncountable cardinal transfers upwards and to all cardinals above the Hanf number. Unlike the previous categoricity transfer results of equal generality the theorem does not assume the categoricity cardinal being a successor. The thesis consists of three independent papers. All three papers are joint work with Tapani Hyttinen.

Studies on Binary Time Series Models with Applications to Empirical Macroeconomics and Finance

This thesis studies binary time series models and their applications in empirical macroeconomics and finance. In addition to previously suggested models, new dynamic extensions are proposed to the static probit model commonly used in the previous literature. In particular, we are interested in probit models with an autoregressive model structure. In Chapter 2, the main objective is to compare the predictive performance of the static and dynamic probit models in forecasting the U.S. and German business cycle recession periods. Financial variables, such as interest rates and stock market returns, are used as predictive variables. The empirical results suggest that the recession periods are predictable and dynamic probit models, especially models with the autoregressive structure, outperform the static model. Chapter 3 proposes a Lagrange Multiplier (LM) test for the usefulness of the autoregressive structure of the probit model. The finite sample properties of the LM test are considered with simulation experiments. Results indicate that the two alternative LM test statistics have reasonable size and power in large samples. In small samples, a parametric bootstrap method is suggested to obtain approximately correct size. In Chapter 4, the predictive power of dynamic probit models in predicting the direction of stock market returns are examined. The novel idea is to use recession forecast (see Chapter 2) as a predictor of the stock return sign. The evidence suggests that the signs of the U.S. excess stock returns over the risk-free return are predictable both in and out of sample. The new "error correction" probit model yields the best forecasts and it also outperforms other predictive models, such as ARMAX models, in terms of statistical and economic goodness-of-fit measures. Chapter 5 generalizes the analysis of univariate models considered in Chapters 2 4 to the case of a bivariate model. A new bivariate autoregressive probit model is applied to predict the current state of the U.S. business cycle and growth rate cycle periods. Evidence of predictability of both cycle indicators is obtained and the bivariate model is found to outperform the univariate models in terms of predictive power.

A Comparison of Managers’ Perception of Short-Termism in Finland, Sweden and the U.S

Increased media exposure to layoffs and corporate quarterly financial reporting have created arguable a common perception – especially favored by the media itself – that the companies have been forced to improve their financial performance from quarter to quarter. Academically the relevant question is whether companies themselves feel that they are exposed to short-term pressure to perform even if it means that they have to compromise company’s long-term future. This paper studies this issue using results from a survey conducted among the 500 largest companies in Finland. The results show that companies in general feel moderate short-term pressure, with reasonable dispersion across firms. There seems to be a link between the degree of pressure felt, and the firm’s ownership structure, i.e. we find support for the existence of short-term versus long-term owners. We also find significant ownership related differences, in line with expectations, in how such short-term pressure is reflected in actual decision variables such as the investment criteria used.

Finnish Short-Term Stock Returns

Functioning capital markets are a crucial part of a competitive economy since they provide the mechanisms to allocate resources. In order to be well functioning a capital market has to be efficient. Market efficiency is defined as a market where prices at any time fully reflect all available information. Basically, this means that abnormal returns cannot be predicted since they are dependent on future, presently unknown, information. The debate of market efficiency has been going on for several decades. Most academics today would probably agree that financial markets are reasonably efficient since virtually nobody has been able to achieve continuous abnormal positive returns. However, it is clear that a set of return anomalies exists, although they are apparently to small to enable substantial economic profit. Moreover, these anomalies can often be attributed to market design. The motivation for this work is to expand the knowledge of short-term trading patterns and to offer some explanations for these patterns. In the first essay the return pattern during the day is examined. On average stock prices move during two time periods of the day, namely, immediately after the opening and around the formal close of the market. Since stock prices, on average, move upwards these abnormal returns are generally positive and cause the distinct U-shape of intraday returns. In the second essay the results in the first essay are examined further. The return pattern around the former close is shown to partly be the result of manipulative action by market participants. In the third essay the focus is shifted towards trading patterns of the underlying stocks on days when index options and index futures on the stocks expire. Generally no expiration day effect was found. However, some indication of an expiration day effect was found when a large amount of open in- or at-the-money contracts existed. Also, the effects were likelier to be found for shares with high index-weight but fairly low trading volume. Last, in the forth essay the attention is turned to the behaviour of different tax clienteles around the dividend ex-day. Two groups of investors showed abnormal trading behaviour. Domestic non-financial investors, especially domestic companies, showed a dividend capturing behaviour, i.e. buying cum-dividend and selling ex-dividend shares. The opposite behaviour was found for foreign investors and domestic financial institutions. The effect was more notable for high yield, high volume stocks.

Intraday Dynamics of International Equity Markets

The increased availability of high frequency data sets have led to important new insights in understanding of financial markets. The use of high frequency data is interesting and persuasive, since it can reveal new information that cannot be seen in lower data aggregation. This dissertation explores some of the many important issues connected with the use, analysis and application of high frequency data. These include the effects of intraday seasonal, the behaviour of time varying volatility, the information content of various market data, and the issue of inter market linkages utilizing high frequency 5 minute observations from major European and the U.S stock indices, namely DAX30 of Germany, CAC40 of France, SMI of Switzerland, FTSE100 of the UK and SP500 of the U.S. The first essay in the dissertation shows that there are remarkable similarities in the intraday behaviour of conditional volatility across European equity markets. Moreover, the U.S macroeconomic news announcements have significant cross border effect on both, European equity returns and volatilities. The second essay reports substantial intraday return and volatility linkages across European stock indices of the UK and Germany. This relationship appears virtually unchanged by the presence or absence of the U.S stock market. However, the return correlation among the U.K and German markets rises significantly following the U.S stock market opening, which could largely be described as a contemporaneous effect. The third essay sheds light on market microstructure issues in which traders and market makers learn from watching market data, and it is this learning process that leads to price adjustments. This study concludes that trading volume plays an important role in explaining international return and volatility transmissions. The examination concerning asymmetry reveals that the impact of the positive volume changes is larger on foreign stock market volatility than the negative changes. The fourth and the final essay documents number of regularities in the pattern of intraday return volatility, trading volume and bid-ask spreads. This study also reports a contemporaneous and positive relationship between the intraday return volatility, bid ask spread and unexpected trading volume. These results verify the role of trading volume and bid ask quotes as proxies for information arrival in producing contemporaneous and subsequent intraday return volatility. Moreover, asymmetric effect of trading volume on conditional volatility is also confirmed. Overall, this dissertation explores the role of information in explaining the intraday return and volatility dynamics in international stock markets. The process through which the information is incorporated in stock prices is central to all information-based models. The intraday data facilitates the investigation that how information gets incorporated into security prices as a result of the trading behavior of informed and uninformed traders. Thus high frequency data appears critical in enhancing our understanding of intraday behavior of various stock markets’ variables as it has important implications for market participants, regulators and academic researchers.

Essays on Stock Options, Incentives, and Managerial Action

Executive compensation and managerial behavior have received an increasing amount of attention in the financial economics literature since the mid 1970s. The purpose of this thesis is to extend our understanding of managerial compensation, especially how stock option compensation is linked to the actions undertaken by the management. Furthermore, managerial compensation is continuously and heatedly debated in the media and an emerging consensus from this discussion seems to be that there still exists gaps in our knowledge of optimal contracting. In Finland, the first executive stock options were introduced in the 1980s and throughout the last 15 years it has become increasingly popular for Finnish listed firms to use this type of managerial compensation. The empirical work in the thesis is conducted using data from Finland, in contrast to most previous studies that predominantly use U.S. data. Using Finnish data provides insight of how market conditions affect compensation and managerial action and provides an opportunity to explore what parts of the U.S. evidence can be generalized to other markets. The thesis consists of four essays. The first essay investigates the exercise policy of the executive stock option holders in Finland. In summary, Essay 1 contributes to our understanding of the exercise policies by examining both the determinants of the exercise decision and the markets reaction to the actual exercises. The second essay analyzes the factors driving stock option grants using data for Finnish publicly listed firms. Several agency theory based variables are found to have have explanatory power on the likelihood of a stock option grant. Essay 2 also contributes to our understanding of behavioral factors, such as prior stock return, as determinants of stock option compensation. The third essay investigates the tax and stock option motives for share repurchases and dividend distributions. We document strong support for the tax motive for share repurchases. Furthermore, we also analyze the dividend distribution decision in companies with stock options and find a significant difference between companies with and without dividend protected options. We thus document that the cutting of dividends found in previous U.S. studies can be avoided by dividend protection. In the fourth essay we approach the puzzle of negative skewness in stock returns from an altogether different angle than in previous studies. We suggest that negative skewness in stock returns is generated by management disclosure practices and find proof for this. More specifically, we find that negative skewness in daily returns is induced by returns for days when non-scheduled firm specific news is disclosed.

Essays on Risk and Return

Perhaps the most fundamental prediction of financial theory is that the expected returns on financial assets are determined by the amount of risk contained in their payoffs. Assets with a riskier payoff pattern should provide higher expected returns than assets that are otherwise similar but provide payoffs that contain less risk. Financial theory also predicts that not all types of risks should be compensated with higher expected returns. It is well-known that the asset-specific risk can be diversified away, whereas the systematic component of risk that affects all assets remains even in large portfolios. Thus, the asset-specific risk that the investor can easily get rid of by diversification should not lead to higher expected returns, and only the shared movement of individual asset returns – the sensitivity of these assets to a set of systematic risk factors – should matter for asset pricing. It is within this framework that this thesis is situated. The first essay proposes a new systematic risk factor, hypothesized to be correlated with changes in investor risk aversion, which manages to explain a large fraction of the return variation in the cross-section of stock returns. The second and third essays investigate the pricing of asset-specific risk, uncorrelated with commonly used risk factors, in the cross-section of stock returns. The three essays mentioned above use stock market data from the U.S. The fourth essay presents a new total return stock market index for the Finnish stock market beginning from the opening of the Helsinki Stock Exchange in 1912 and ending in 1969 when other total return indices become available. Because a total return stock market index for the period prior to 1970 has not been available before, academics and stock market participants have not known the historical return that stock market investors in Finland could have achieved on their investments. The new stock market index presented in essay 4 makes it possible, for the first time, to calculate the historical average return on the Finnish stock market and to conduct further studies that require long time-series of data.

Essays on Stock Option Compensation and the Role of Incentives and Risk (summary section only)

Managerial pay-for-performance sensitivity has increased rapidly around the world. Early empirical research showed that pay-for-performance sensitivity resulting from stock ownership and stock options appeared to be quite low during the 1970s and early 1980s in the U.S. However, recent empirical research from the U.S. shows an enormous increase in pay-for-performance sensitivity. The global trend has also reached Finland, where stock options have become a major ingredient of executive compensation. The fact that stock options seem to be an appealing form of remuneration from a theoretical point of view combined with the observation that the use of this compensation form has increased significantly during the recent years, implies that research on the dynamics of stock option compensation is highly relevant for the academic community, as well as for practitioners and regulators. The research questions of the thesis are analyzed in four separate essays. The first essay examines whether stock option compensation practices of Finnish firms are consistent with predictions from principal-agent theory. The second essay explores one of the major puzzles in the compensation literature by studying determinants of stock option contract design. In theory, optimal contract design should vary according to firm characteristics. However, in the U.S., variation in contract design seems to be surprisingly low, a phenomenon generally attributed to tax and accounting considerations. In Finland, however, firms are not subject to stringent contracting restrictions, and the variation in contract design tends, in fact, to be quite substantial. The third essay studies the impact of price- and risk incentives arising from stock option compensation on firm investment. In addition, the essay explores one of the most debated questions in the literature, in particular, the relation between incentives and firm performance. Finally, several strands of literature in both economics and corporate finance hypothesize that economic uncertainty is related to corporate decision-making. Previous research has shown that risk tends to slow down firm investment. In the fourth essay, it is hypothesized that firm risk slows down growth from a more universal perspective. Consistent with this view, it is shown that risk not only tends to slow down firm investment, but also employment growth. Moreover, the essay explores whether the nature of firms’ compensation policies, in particular, whether firms make use of stock option compensation, affects the relation between risk and firm growth. In summary, the four essays contribute to the current understanding of stock options as a form of equity incentives, and how incentives and risk affect corporate decision-making. By this, the thesis promotes the knowledge related to the modern theory of the firm.

Share Repurchases, Dividends, and Executive Options

This paper reports empirical results on the determinants of the authorization decision for share repurchases and dividends in Finland. We use a data set with precise data on share repurchases as well as characteristics for the option programs. Contrary to the U.S., we use a data set where 41% of the options are dividend protected, which allows us to separate between the "option funding" and "substitution / managerial wealth" hypothesis for the choice of the distribution method. We find that foreign ownership is the main determinant for share repurchases in Finland and attribute this relationship to tax factors. We also find evidence in support of both the signaling and agency cost hypotheses for cash distributions, especially in the case of share repurchases. Finally, we find a significant difference between companies with and without dividend protected options. When options are dividend protected, the relationship between dividend distributions and the scope of the options program turns to a significantly positive one instead of the negative one documented on U.S. data. This gives some support for the substitution / managerial wealth hypothesis as a determinant for the choice of the distribution method.

Test of the Clustering Hypothesis in the Helsinki Exchanges

This paper investigates the clustering pattern in the Finnish stock market. Using trading volume and time as factors capturing the clustering pattern in the market, the Keim and Madhavan (1996) and the Engle and Russell (1998) model provide the framework for the analysis. The descriptive and the parametric analysis provide evidences that an important determinant of the famous U-shape pattern in the market is the rate of information arrivals as measured by large trading volumes and durations at the market open and close. Precisely, 1) the larger the trading volume, the greater the impact on prices both in the short and the long run, thus prices will differ across quantities. 2) Large trading volume is a non-linear function of price changes in the long run. 3) Arrival times are positively autocorrelated, indicating a clustering pattern and 4) Information arrivals as approximated by durations are negatively related to trading flow.