Domestic and foreign bias in global real estate mutual fund investment allocations

The purpose of the study is to seek a better understanding of the investment allocation behaviour of the real estate mutual funds by focusing on asset allocation at the country level. Analysing the country allocation of 553 real estate mutual funds domiciled in 20 countries, we attempt to trace how investment bias exists across countries and affects their country allocations. Our results evidence the existence of disproportionate country allocation to their domestic markets (domestic bias) and to each foreign market (foreign bias). We also find each bias is influenced by different sets of variables: real estate market influences for domestic bias and familiarity influences for foreign bias. This difference in factors influential for each bias in part explains the conflated relationship between the two biases.

Using seasonal hindcasts to understand the origin of the equatorial cold tongue bias in CGCMs and its impact on ENSO

The cold equatorial SST bias in the tropical Pacific that is persistent in many coupled OAGCMs severely impacts the fidelity of the simulated climate and variability in this key region, such as the ENSO phenomenon. The classical bias analysis in these models usually concentrates on multi-decadal to centennial time series needed to obtain statistically robust features. Yet, this strategy cannot fully explain how the models errors were generated in the first place. Here, we use seasonal re-forecasts (hindcasts) to track back the origin of this cold bias. As such hindcasts are initialized close to observations, the transient drift leading to the cold bias can be analyzed to distinguish pre-existing errors from errors responding to initial ones. A time sequence of processes involved in the advent of the final mean state errors can then be proposed. We apply this strategy to the ENSEMBLES-FP6 project multi-model hindcasts of the last decades. Four of the five AOGCMs develop a persistent equatorial cold tongue bias within a few months. The associated systematic errors are first assessed separately for the warm and cold ENSO phases. We find that the models are able to reproduce either El Niño or La Niña close to observations, but not both. ENSO composites then show that the spurious equatorial cooling is maximum for El Niño years for the February and August start dates. For these events and at this time of the year, zonal wind errors in the equatorial Pacific are present from the beginning of the simulation and are hypothesized to be at the origin of the equatorial cold bias, generating too strong upwelling conditions. The systematic underestimation of the mixed layer depth in several models can also amplify the growth of the SST bias. The seminal role of these zonal wind errors is further demonstrated by carrying out ocean-only experiments forced by the AOCGCMs daily 10-meter wind. In a case study, we show that for several models, this forcing is sufficient to reproduce the main SST error patterns seen after 1 month in the AOCGCM hindcasts.

Assessment of surface winds over the Atlantic, Indian and Pacific Ocean sectors of the Southern Ocean in CMIP5 models: historical bias, forcing response, and state dependence

An assessment of the fifth Coupled Models Intercomparison Project (CMIP5) models’ simulation of the near-surface westerly wind jet position and strength over the Atlantic, Indian and Pacific sectors of the Southern Ocean is presented. Compared with reanalysis climatologies there is an equatorward bias of 3.7° (inter-model standard deviation of ± 2.2°) in the ensemble mean position of the zonal mean jet. The ensemble mean strength is biased slightly too weak, with the largest biases over the Pacific sector (-1.6±1.1 m/s, 27 -22%). An analysis of atmosphere-only (AMIP) experiments indicates that 41% of the zonal mean position bias comes from coupling of the ocean/ice models to the atmosphere. The response to future emissions scenarios (RCP4.5 and RCP8.5) is characterized by two phases: (i) the period of most rapid ozone recovery (2000-2049) during which there is insignificant change in summer; and (ii) the period 2050-2098 during which RCP4.5 simulations show no significant change but RCP8.5 simulations show poleward shifts (0.30, 0.19 and 0.28°/decade over the Atlantic, Indian and Pacific sectors respectively), and increases in strength (0.06, 0.08 and 0.15 m/s/decade respectively). The models with larger equatorward position biases generally show larger poleward shifts (i.e. state dependence). This inter-model relationship is strongest over the Pacific sector (r=-0.89) and insignificant over the Atlantic sector (r=-0.50). However, an assessment of jet structure shows that over the Atlantic sector jet shift is significantly correlated with jet width whereas over the Pacific sector the distance between the sub-polar and sub-tropical westerly jets appears to be more important.

Bias or rationality? The case of UK commercial real estate investment

Purpose – The purpose of this paper is to test the hypothesis that investment decision making in the UK direct property market does not conform to the assumption of economic rationality underpinning portfolio theory. Design/methodology/approach – The developing behavioural real estate paradigm is used to challenge the idea that investor “man” is able to perform with economic rationality, specifically with reference to the analysis of the spatial dispersion of the entire UK “investible stock” and “investible locations” against observed spatial patterns of institutional investment. Location quotients are derived, combining different data sets. Findings – Considerably greater variation in institutional property holdings is found across the UK than would be expected given the economic and stock characteristics of local areas. This appears to provide evidence of irrationality (in the strict traditional economic sense) in the behaviour of institutional investors, with possible herding underpinning levels of investment that cannot be explained otherwise. Research limitations/implications – Over time a lack of distinction has developed between the cause and effect of comparatively low levels of development and institutional property investment across the regions. A critical examination of decision making and behaviour in practice could break this cycle, and could in turn promote regional economic growth. Originality/value – The entire “population” of observations is used to demonstrate the relationships between economic theory and investor performance exploring, for the first time, stock and local area characteristics.

Natural disaster accounting bias and its equivalence across genetic resource stocks

Two sources of bias arise in conventional loss predictions in the wake of natural disasters. One source of bias stems from neglect of accounting for animal genetic resource loss. A second source of bias stems from failure to identify, in addition to the direct effects of such loss, the indirect effects arising from implications impacting animal-human interactions. We argue that, in some contexts, the magnitude of bias imputed by neglecting animal genetic resource stocks is substantial. We show, in addition, and contrary to popular belief, that the biases attributable to losses in distinct genetic resource stocks are very likely to be the same. We derive the formal equivalence across the distinct resource stocks by deriving an envelope result in a model that forms the mainstay of enquiry in subsistence farming and we validate the theory, empirically, in a World-Society-for-the-Protection-of-Animals application

Interpretation bias in preschool children at risk for anxiety: a prospective study

A story-stem paradigm was used to assess interpretation bias in preschool children. Data were available for 131 children. Interpretation bias, behavioural inhibition (BI) and anxiety were assessed when children were aged between 3 years 2 months and 4 years 5 months. Anxiety was subsequently assessed 12-months, 2-years and 5-years later. A significant difference in interpretation bias was found between participants who met criteria for an anxiety diagnosis at baseline, with clinically anxious participants more likely to complete the ambiguous story-stems in a threat-related way. Threat interpretations significantly predicted anxiety symptoms at 12-month follow-up, after controlling for baseline symptoms, but did not predict anxiety symptoms or diagnoses at either 2-year or 5- year follow-up. There was little evidence for a relationship between BI and interpretation bias. Overall, the pattern of results was not consistent with the hypothesis that interpretation bias plays a role in the development of anxiety. Instead, some evidence for a role in the maintenance of anxiety over relatively short periods of time was found. The use of a story-stem methodology to assess interpretation bias in young children is discussed along with the theoretical and clinical implications of the findings.

There’s that scary picture: attention bias to threatening scenes in Williams syndrome

There is increasing evidence that Williams syndrome (WS) is associated with elevated anxiety that is non-social in nature, including generalised anxiety and fears. To date very little research has examined the cognitive processes associated with this anxiety. In the present research, attentional bias for non-social threatening images in WS was examined using a dot-probe paradigm. Participants were 16 individuals with WS aged between 13 and 34 years and two groups of typically developing controls matched to the WS group on chronological age and attentional control ability respectively. The WS group exhibited a significant attention bias towards threatening images. In contrast, no bias was found for group matched on attentional control and a slight bias away from threat was found in the chronological age matched group. The results are contrasted with recent findings suggesting that individuals with WS do not show an attention bias for threatening faces and discussed in relation to neuroimaging research showing elevated amygdala activation in response to threatening non-social scenes in WS.

I see happy people: attention bias towards happy but not angry facial expressions in Williams syndrome

Introduction: Observations of behaviour and research using eye-tracking technology have shown that individuals with Williams syndrome (WS) pay an unusual amount of attention to other people’s faces. The present research examines whether this attention to faces is moderated by the valence of emotional expression. Method: Sixteen participants with WS aged between 13 and 29 years (Mean=19 years 9 months) completed a dot-probe task in which pairs of faces displaying happy, angry and neutral expressions were presented. The performance of the WS group was compared to two groups of typically developing control participants, individually matched to the participants in the WS group on either chronological age or mental age. General mental age was assessed in the WS group using the Woodcock Johnson Test of Cognitive Ability Revised (WJ-COG-R; Woodcock & Johnson, 1989; 1990). Results: Compared to both control groups, the WS group exhibited a greater attention bias for happy faces. In contrast, no between-group differences in bias for angry faces were obtained. Conclusions: The results are discussed in relation to recent neuroimaging findings and the hypersocial behaviour that is characteristic of the WS population.

Non-pain goal pursuit inhibits attentional bias to pain

Although dealing with pain is a vital goal to pursue, most individuals are also engaged in the pursuit of other goals. The aim of the present experiment was to investigate whether attentional bias to pain signals is inhibited when one is pursuing a concurrent salient but nonpain task goal. Attentional bias to pain signals was measured in pain-free volunteers (n=63) using a spatial cueing task with pain cues and neutral cues. The pursuit of a concurrent goal was manipulated by including additional trials in which a digit appeared at the middle of the screen. Half of the participants (goal group) were instructed to name these additional stimuli aloud. In order to increase the affective-motivational value of this non-pain-related goal, monetary reward and punishment were made contingent upon the performance of this task. Participants of the control group did not perform the additional task. As predicted, the results show attentional bias to pain signals in the control group, but not in the goal group. This indicates that attentional bias to signals of impending pain is inhibited when one is engaged in the pursuit of another salient but nonpain goal. The results of this study underscore a motivational view on attention to pain, in which the pursuit of multiple goals, including nonpain goals, is taken into account.

Explicit and implicit subject bias in the ABS journal quality guide

This paper addresses issues raised in two recent papers published in this journal about the UK Association of Business Schools' Journal Quality Guide (ABS Guide). While much of the debate about journal rankings in general, and the ABS Guide in particular, has focused on the construction, power and (mis)use of these rankings, this paper differs in that it explains and provides evidence about explicit and implicit biases in the ABS Guide. In so doing, it poses potentially difficult questions that the editors of the ABS Guide need to address and urgently rectify if the ABS Guide seeks to build and retain legitimacy. In particular, the evidence in this paper shows explicit bias in the ABS Guide against several subject areas, including accounting and finance. It also shows implicit bias against accounting and finance when comparing journal rankings in sub-areas shared between accounting and finance and the broader business management subject areas.

Characterizing sampling bias in the trace gas climatologies of the SPARC Data Initiative

Monthly zonal mean climatologies of atmospheric measurements from satellite instruments can have biases due to the nonuniform sampling of the atmosphere by the instruments. We characterize potential sampling biases in stratospheric trace gas climatologies of the Stratospheric Processes and Their Role in Climate (SPARC) Data Initiative using chemical fields from a chemistry climate model simulation and sampling patterns from 16 satellite-borne instruments. The exercise is performed for the long-lived stratospheric trace gases O3 and H2O. Monthly sampling biases for O3 exceed 10% for many instruments in the high-latitude stratosphere and in the upper troposphere/lower stratosphere, while annual mean sampling biases reach values of up to 20% in the same regions for some instruments. Sampling biases for H2O are generally smaller than for O3, although still notable in the upper troposphere/lower stratosphere and Southern Hemisphere high latitudes. The most important mechanism leading to monthly sampling bias is nonuniform temporal sampling, i.e., the fact that for many instruments, monthly means are produced from measurements which span less than the full month in question. Similarly, annual mean sampling biases are well explained by nonuniformity in the month-to-month sampling by different instruments. Nonuniform sampling in latitude and longitude are shown to also lead to nonnegligible sampling biases, which are most relevant for climatologies which are otherwise free of biases due to nonuniform temporal sampling.