The NASCAR phenomenon: Auto racing sponsorships and shareholder wealth

This study presents the first analysis of the impact of NASCAR sponsorship announcements on the stock prices of sponsoring firms. The primary finding of the study-that NASCAR sponsorship announcements were accompanied by the largest increases in shareholder wealth ever recorded in the marketing literature in response to a voluntary marketing program-represents a striking and unambiguous stock market endorsement of the sponsorships. Indeed, the 24 sponsors analyzed in this study experienced mean increases in shareholder wealth of over $300 million dollars, net of all of the costs associated with the sponsorships. A multiple regression analysis of firm-specific stock price changes and select corporate and sponsorship attributes indicates that NASCAR sponsorships with more successful racing teams, corporate (as opposed to product or divisional) sponsorships, and sponsorships with direct ties to the consumer automotive industry are all positively correlated with perceived sponsorship success, while corporate cash flow per share (a well-known proxy for agency conflicts within the firm) is negatively related with shareholder approval.

Modelling the behaviour of the new issue market

This paper analyses the time series behaviour of the initial public offering (IPO) market using an equilibrium model of demand and supply that incorporates the number of new issues, average underpricing, and general market conditions. Model predictions include the existence of serial correlation in both the number of new issues and the average level of underpricing, as well as interactions between these variables and the impact of general market conditions. The model is tested using 40 years of monthly IPO data. The empirical results are generally consistent with predictions.

Price discovery and volatility spillovers in index futures markets: Some evidence from Mexico

This paper investigates the hypotheses that the recently established Mexican stock index futures market effectively serves the price discovery function, and that the introduction of futures trading has provoked volatility in the underlying spot market. We test both hypotheses simultaneously with daily data from Mexico in the context of a modified EGARCH model that also incorporates possible cointegration between the futures and spot markets. The evidence supports both hypotheses, suggesting that the futures market in Mexico is a useful price discovery vehicle, although futures trading has also been a source of instability for the spot market. Several managerial implications are derived and discussed. (C) 2004 Elsevier B.V. All rights reserved.

A note on execution costs for stock index futures: Information versus liquidity effects

This paper examines execution costs and the impact of trade size for stock index futures using price-volume transaction data from the London International Financial Futures and Options Exchange. Consistent with Subrahmanyam [Rev. Financ. Stud. 4 (1991) 11] we find that effective half spreads in the stock index futures market are small compared to stock markets, and that trades in stock index futures have only a small permanent price impact. This result is important as it helps to better understand the success of equity index products such as index futures and Exchange Traded Funds. We also find that there is no asymmetry in the post-trade price reaction between purchases and sales for stock index futures across various trade sizes. This result is consistent with the conjecture in Chan and Lakonishok [J. Financ. Econ. 33 (1993) 173] that the asymmetry surrounding block trades in stock markets is due to the high cost of short selling and the general reluctance of traders to short sell on stock markets. (C) 2004 Elsevier B.V. All rights reserved.

Thirty-year recovery trend in the once depleted Hawaiian green sea turtle stock

The green sea turtle is one of the long-lived species that comprise the charismatic marine megafauna. The green turtle has a long history of human exploitation with some stocks extinct. Here we report on a 30-year study of the nesting abundance of the green turtle stock endemic to the Hawaiian Archipelago. We show that there has been a substantial long-term increase in abundance of this once seriously depleted stock following cessation of harvesting since the 1970s. This population increase has occurred in a far shorter period of time than previously thought possible. There was also a distinct 3-4 year periodicity in annual nesting abundance that might be a function of regional environmental stochasticity that synchronises breeding behaviour throughout the Archipelago. This is one of the few reliable long-term population abundance time series for a large long-lived marine species, which are needed for gaining insights into the recovery process of long-lived marine species and long-term ecological processes. (C) 2003 Elsevier Ltd. All rights reserved.

Consumption habit and international stock returns

We use the consumption-based asset pricing model with habit formation to study the predictability and cross-section of returns from the international equity markets. We find that the predictability of returns from many developed countries' equity markets is explained in part by changing prices of risks associated with consumption relative to habit at the world as well as local levels. We also provide an exploratory investigation of the cross-sectional implications of the model under the complete world market integration hypothesis and find that the model performs mildly better than the traditional consumption-based model. the unconditional and conditional world CAPMs and a three-factor international asset pricing model. (C) 2004 Elsevier B.V. All rights reserved.

Empirical investigation of investment behaviour in Australia's pastoral region

Optimal intertemporal investment behaviour of Australian pastoralists is modelled using panel data for the period 1979-1993. Results indicate that quasi-fixity of inputs of labour, capital, sheep numbers and cattle numbers is characteristic of production in the pastoral region. It takes about two years for labour, four years for capital and a little over two years for both sheep numbers and cattle numbers to adjust towards long-run optimal levels. Results also indicate that, after accounting for adjustment costs, own-price product supply and input demand responses are inelastic in both the short and long run.

Longitudinal associations between children's phonological processing abilities, ADHD-like behaviour ratings and early reading develpment

The current study examined the contribution of phonological processing abilities and ADHD-like behaviours to first-grade word reading ability. 136 children were tested at the beginning and end of first grade. At both times, teachers rated children on hyperactive, inattentive, and oppositional behaviour. Children were given tests of letter knowledge at T1 and tests of word reading, phonological sensitivity, phonological memory, rapid automatised naming, and vocabulary at T1 and T2. Regression analyses revealed that, of the behavioural measures, inattention made the strongest contribution to T2 reading, even after controlling for the effects of T1 reading, hyperactivity, and oppositional behaviour. Hyperactivity did not explain variance in T2 reading once the effect of inattention was controlled. Inattention predicted 4.7% independent variance in T2 word reading ability, even after the effects of T1 reading, vocabulary, and phonological processing were controlled. Although phonological processing predicted 9.3% independent variance in T2 word reading, even after the effects of reading, vocabulary, and inattention were controlled, the effects of phonological processing may have been partly mediated by inattention. This research indicates that inattention contributes to the prediction of early reading development in unselected populations, and that this influence is independent of other key cognitive predictors of reading ability.