Bid-ask spreads and volatility in the foreign exchange market. An empirical analysis

Consistent with the implications from a simple asymmetric information model for the bid-ask spread, we present empirical evidence that the size of the bid-ask spread in the foreign exchange market is positively related to the underlying exchange rate uncertainty. The estimation results are based on an ordered probit analysis that captures the discreteness in the spread distribution, with the uncertainty of the spot exchange rate being quantified through a GARCH type model. The data sets consists of more than 300,000 continuously recorded Deutschemark/dollar quotes over the period from April 1989 to June 1989. © 1994.

How common are common mental disorders? Evidence that lifetime prevalence rates are doubled by prospective versus retrospective ascertainment.

BACKGROUND: Most information about the lifetime prevalence of mental disorders comes from retrospective surveys, but how much these surveys have undercounted due to recall failure is unknown. We compared results from a prospective study with those from retrospective studies. METHOD: The representative 1972-1973 Dunedin New Zealand birth cohort (n=1037) was followed to age 32 years with 96% retention, and compared to the national New Zealand Mental Health Survey (NZMHS) and two US National Comorbidity Surveys (NCS and NCS-R). Measures were research diagnoses of anxiety, depression, alcohol dependence and cannabis dependence from ages 18 to 32 years. RESULTS: The prevalence of lifetime disorder to age 32 was approximately doubled in prospective as compared to retrospective data for all four disorder types. Moreover, across disorders, prospective measurement yielded a mean past-year-to-lifetime ratio of 38% whereas retrospective measurement yielded higher mean past-year-to-lifetime ratios of 57% (NZMHS, NCS-R) and 65% (NCS). CONCLUSIONS: Prospective longitudinal studies complement retrospective surveys by providing unique information about lifetime prevalence. The experience of at least one episode of DSM-defined disorder during a lifetime may be far more common in the population than previously thought. Research should ask what this means for etiological theory, construct validity of the DSM approach, public perception of stigma, estimates of the burden of disease and public health policy.

"Call for prices": Strategic implications of raising consumers' costs

Many consumer durable retailers often do not advertise their prices and instead ask consumers to call them for prices. It is easy to see that this practice increases the consumers' cost of learning the prices of products they are considering, yet firms commonly use such practices. Not advertising prices may reduce the firm's advertising costs, but the strategic effects of doing so are not clear. Our objective is to examine the strategic effects of this practice. In particular, how does making price discovery more difficult for consumers affect competing retailers' price, service decisions, and profits? We develop a model in which a manufacturer sells its product through a high-service retailer and a low-service retailer. Consumers can purchase the retail service at the high-end retailer and purchase the product at the competing low-end retailer. Therefore, the high-end retailer faces a free-riding problem. A retailer first chooses its optimal service levels. Then, it chooses its optimal price levels. Finally, a retailer decides whether to advertise its prices. The model results in four structures: (1) both retailers advertise prices, (2) only the low-service retailer advertises price, (3) only the high-service retailer advertises price, and (4) neither retailer advertises price. We find that when a retailer does not advertise its price and makes price discovery more difficult for consumers, the competition between the retailers is less intense. However, the retailer is forced to charge a lower price. In addition, if the competing retailer does advertise its prices, then the competing retailer enjoys higher profit margins. We identify conditions under which each of the above four structures is an equilibrium and show that a low-service retailer not advertising its price is a more likely outcome than a high-service retailer doing so. We then solve the manufacturer's problem and find that there are several instances when a retailer's advertising decisions are different from what the manufacturer would want. We describe the nature of this channel coordination problem and identify some solutions. © 2010 INFORMS.

Developing a simplified consent form for biobanking.

BACKGROUND: Consent forms have lengthened over time and become harder for participants to understand. We sought to demonstrate the feasibility of creating a simplified consent form for biobanking that comprises the minimum information necessary to meet ethical and regulatory requirements. We then gathered preliminary data concerning its content from hypothetical biobank participants. METHODOLOGY/PRINCIPAL FINDINGS: We followed basic principles of plain-language writing and incorporated into a 2-page form (not including the signature page) those elements of information required by federal regulations and recommended by best practice guidelines for biobanking. We then recruited diabetes patients from community-based practices and randomized half (n = 56) to read the 2-page form, first on paper and then a second time on a tablet computer. Participants were encouraged to use "More information" buttons on the electronic version whenever they had questions or desired further information. These buttons led to a series of "Frequently Asked Questions" (FAQs) that contained additional detailed information. Participants were asked to identify specific sentences in the FAQs they thought would be important if they were considering taking part in a biorepository. On average, participants identified 7 FAQ sentences as important (mean 6.6, SD 14.7, range: 0-71). No one sentence was highlighted by a majority of participants; further, 34 (60.7%) participants did not highlight any FAQ sentences. CONCLUSIONS: Our preliminary findings suggest that our 2-page form contains the information that most prospective participants identify as important. Combining simplified forms with supplemental material for those participants who desire more information could help minimize consent form length and complexity, allowing the most substantively material information to be better highlighted and enabling potential participants to read the form and ask questions more effectively.

Independent evolutionary origins of landlocked alewife populations and rapid parallel evolution of phenotypic traits.

Alewife, Alosa pseudoharengus, populations occur in two discrete life-history variants, an anadromous form and a landlocked (freshwater resident) form. Landlocked populations display a consistent pattern of life-history divergence from anadromous populations, including earlier age at maturity, smaller adult body size, and reduced fecundity. In Connecticut (USA), dams constructed on coastal streams separate anadromous spawning runs from lake-resident landlocked populations. Here, we used sequence data from the mtDNA control region and allele frequency data from five microsatellite loci to ask whether coastal Connecticut landlocked alewife populations are independently evolved from anadromous populations or whether they share a common freshwater ancestor. We then used microsatellite data to estimate the timing of the divergence between anadromous and landlocked populations. Finally, we examined anadromous and landlocked populations for divergence in foraging morphology and used divergence time estimates to calculate the rate of evolution for foraging traits. Our results indicate that landlocked populations have evolved multiple times independently. Tests of population divergence and estimates of gene flow show that landlocked populations are genetically isolated, whereas anadromous populations exchange genes. These results support a 'phylogenetic raceme' model of landlocked alewife divergence, with anadromous populations forming an ancestral core from which landlocked populations independently diverged. Divergence time estimates suggest that landlocked populations diverged from a common anadromous ancestor no longer than 5000 years ago and perhaps as recently as 300 years ago, depending on the microsatellite mutation rate assumed. Examination of foraging traits reveals landlocked populations to have significantly narrower gapes and smaller gill raker spacings than anadromous populations, suggesting that they are adapted to foraging on smaller prey items. Estimates of evolutionary rates (in haldanes) indicate rapid evolution of foraging traits, possibly in response to changes in available resources.

Where does energy R&D come from? Examining crowding out from energy R&D

Recent efforts to endogenize technological change in climate policy models demonstrate the importance of accounting for the opportunity cost of climate R&D investments. Because the social returns to R&D investments are typically higher than the social returns to other types of investment, any new climate mitigation R&D that comes at the expense of other R&D investment may dampen the overall gains from induced technological change. Unfortunately, there has been little empirical work to guide modelers as to the potential magnitude of such crowding out effects. This paper considers both the private and social opportunity costs of climate R&D. Addressing private costs, we ask whether an increase in climate R&D represents new R&D spending, or whether some (or all) of the additional climate R&D comes at the expense of other R&D. Addressing social costs, we use patent citations to compare the social value of alternative energy research to other types of R&D that may be crowded out. Beginning at the industry level, we find no evidence of crowding out across sectors-that is, increases in energy R&D do not draw R&D resources away from sectors that do not perform R&D. Given this, we proceed with a detailed look at alternative energy R&D. Linking patent data and financial data by firm, we ask whether an increase in alternative energy patents leads to a decrease in other types of patenting activity. While we find that increases in alternative energy patents do result in fewer patents of other types, the evidence suggests that this is due to profit-maximizing changes in research effort, rather than financial constraints that limit the total amount of R&D possible. Finally, we use patent citation data to compare the social value of alternative energy patents to other patents by these firms. Alternative energy patents are cited more frequently, and by a wider range of other technologies, than other patents by these firms, suggesting that their social value is higher. © 2011 Elsevier B.V.

Love is in the air: Sociality and pair bondedness influence sifaka reproductive signalling

© 2013 The Association for the Study of Animal Behaviour.Social complexity, often estimated by group size, is seen as driving the complexity of vocal signals, but its relation to olfactory signals, which arguably arose to function in nonsocial realms, remains underappreciated. That olfactory signals also may mediate within-group interaction, vary with social complexity and promote social cohesion underscores a potentially crucial link with sociality. To examine that link, we integrated chemical and behavioural analyses to ask whether olfactory signals facilitate reproductive coordination in a strepsirrhine primate, the Coquerel's sifaka, Propithecus coquereli. Belonging to a clade comprising primarily solitary, nocturnal species, the diurnal, group-living sifaka represents an interesting test case. Convergent with diurnal, group-living lemurids, sifakas expressed chemically rich scent signals, consistent with the social complexity hypothesis for communication. These signals minimally encoded the sex of the signaller and varied with female reproductive state. Likewise, sex and female fertility were reflected in within-group scent investigation, scent marking and overmarking. We further asked whether, within breeding pairs, the stability or quality of the pair's bond influences the composition of glandular signals and patterns of investigatory or scent-marking behaviour. Indeed, reproductively successful pairs tended to show greater similarity in their scent signals than did reproductively unsuccessful pairs, potentially through chemical convergence. Moreover, scent marking was temporally coordinated within breeding pairs and was influenced by past reproductive success. That olfactory signalling reflects social bondedness or reproductive history lends support to recent suggestions that the quality of relationships may be a more valuable proxy than group size for estimating social complexity. We suggest that olfactory signalling in sifakas is more complex than previously recognized and, as in other socially integrated species, can be a crucial mechanism for promoting group cohesion and maintaining social bonds. Thus, the evolution of sociality may well be reflected in the complexity of olfactory signalling.

Minor Moves: Growth, Fugitivity, and Children's Physical Movement

From tendencies to reduce the Underground Railroad to the imperative "follow the north star" to the iconic images of Ruby Bridges' 1960 "step forward" on the stairs of William Frantz Elementary School, America prefers to picture freedom as an upwardly mobile development. This preoccupation with the subtractive and linear force of development makes it hard to hear the palpable steps of so many truant children marching in the Movement and renders illegible the nonlinear movements of minors in the Underground. Yet a black fugitive hugging a tree, a white boy walking alone in a field, or even pieces of a discarded raft floating downstream like remnants of child's play are constitutive gestures of the Underground's networks of care and escape. Responding to 19th-century Americanists and cultural studies scholars' important illumination of the child as central to national narratives of development and freedom, "Minor Moves" reads major literary narratives not for the child and development but for the fugitive trace of minor and growth.

In four chapters, I trace the physical gestures of Nathaniel Hawthorne's Pearl, Harriet Beecher Stowe's Topsy, Harriet Wilson's Frado, and Mark Twain's Huck against the historical backdrop of the Fugitive Slave Act and the passing of the first compulsory education bills that made truancy illegal. I ask how, within a discourse of independence that fails to imagine any serious movements in the minor, we might understand the depictions of moving children as interrupting a U.S. preoccupation with normative development and recognize in them the emergence of an alternative imaginary. To attend to the movement of the minor is to attend to what the discursive order of a development-centered imaginary deems inconsequential and what its grammar can render only as mistakes. Engaging the insights of performance studies, I regard what these narratives depict as childish missteps (Topsy's spins, Frado's climbing the roof) as dances that trouble the narrative's discursive order. At the same time, drawing upon the observations of black studies and literary theory, I take note of the pressure these "minor moves" put on the literal grammar of the text (Stowe's run-on sentences and Hawthorne's shaky subject-verb agreements). I regard these ungrammatical moves as poetic ruptures from which emerges an alternative and prior force of the imaginary at work in these narratives--a force I call "growth."

Reading these "minor moves" holds open the possibility of thinking about a generative association between blackness and childishness, one that neither supports racist ideas of biological inferiority nor mandates in the name of political uplift the subsequent repudiation of childishness. I argue that recognizing the fugitive force of growth indicated in the interplay between the conceptual and grammatical disjunctures of these minor moves opens a deeper understanding of agency and dependency that exceeds notions of arrested development and social death. For once we interrupt the desire to picture development (which is to say the desire to picture), dependency is no longer a state (of social death or arrested development) of what does not belong, but rather it is what Édouard Glissant might have called a "departure" (from "be[ing] a single being"). Topsy's hard-to-see pick-pocketing and Pearl's running amok with brown men in the market are not moves out of dependency but indeed social turns (a dance) by way of dependency. Dependent, moving and ungrammatical, the growth evidenced in these childish ruptures enables different stories about slavery, freedom, and childishness--ones that do not necessitate a repudiation of childishness in the name of freedom, but recognize in such minor moves a fugitive way out.