Monetary Policy, Stock Price Misalignments and Macroeconomic Instability

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.

Putting a Price on Prisoner Release: The History of Bail and the Future of Parole

In this article, we argue that the history of bail foretells the future of parole. Under a plancalled the Conditional Post-Conviction Release Bond Act (recently passed into law inthree states), US prisoners can secure early release only after posting ‘post-convictionbail’. As with pre-trial bail, the fledgling model would require prisoners to pay a percent-age of the bail amount to secure their release under the contractual responsibility of acommercial bail agency. If release conditions are breached, bounty hunters are legallyempowered to seize and return the parolee to prison. Our inquiry outlines the origins of this post-conviction bond plan and the research upon which it is based. Drawing on the‘new penology’ framework, we identify several underlying factors that make for a ripeadvocacy environment and set the stage for widespread state-level adoption of this planin the near future. Post-conviction bail fits squarely within the growing policy trendstoward privatization, managerialism, and actuarial justice. Most importantly, though,advocates have the benefit of precedent on their side, as most US states have longrelied on a system of commercial bail bonding and private bounty hunting to manageconditional pretrial release.

Combinatorial peptide ligand libraries and plant proteomics: a winning strategy at a price

The mechanism of action and properties of a solid-phase ligand library made of hexapeptides (combinatorial peptide ligand libraries or CPLL), for capturing the "hidden proteome", i.e. the low- and very low-abundance proteins constituting the vast majority of species in any proteome, as applied to plant tissues, are reviewed here. Plant tissues are notoriously recalcitrant to protein extraction and to proteome analysis. Firstly, rigid plant cell walls need to be mechanically disrupted to release the cell content and, in addition to their poor protein yield, plant tissues are rich in proteases and oxidative enzymes, contain phenolic compounds, starches, oils, pigments and secondary metabolites that massively contaminate protein extracts. In addition, complex matrices of polysaccharides, including large amount of anionic pectins, are present. All these species compete with the binding of proteins to the CPLL beads, impeding proper capture and identification / detection of low-abundance species. When properly pre-treated, plant tissue extracts are amenable to capture by the CPLL beads revealing thus many new species among them low-abundance proteins. Examples are given on the treatment of leaf proteins, of corn seed extracts and of exudate proteins (latex from Hevea brasiliensis). In all cases, the detection of unique gene products via CPLL capture is at least twice that of control, untreated sample.

Combinatorial peptide ligand libraries and plant proteomics: a winning strategy at a price

The mechanism of action and properties of a solid-phase ligand library made of hexapeptides (combinatorial peptide ligand libraries or CPLL, for capturing the "hidden proteome", i.e. the low- and very low-abundance proteins Constituting the vast majority of species in any proteome. as applied to plant tissues, are reviewed here. Plant tissues are notoriously recalcitrant to protein extraction and to proteome analysis, Firstly, rigid plant cell walls need to be mechanically disrupted to release the cell content and, in addition to their poor protein yield, plant tissues are rich in proteases and oxidative enzymes, contain phenolic Compounds, starches, oils, pigments and secondary metabolites that massively contaminate protein extracts. In addition, complex matrices of polysaccharides, including large amount of anionic pectins, are present. All these species compete with the binding of proteins to the CPLL beads, impeding proper capture and identification I detection of low-abundance species. When properly pre-treated, plant tissue extracts are amenable to capture by the CPLL beads revealing thus many new species among them low-abundance proteins. Examples are given on the treatment of leaf proteins, of corn seed extracts and of exudate proteins (latex from Hevea brasiliensis). In all cases, the detection of unique gene products via CPLL Capture is at least twice that of control, untreated sample. (c) 2008 Elsevier B.V. All rights reserved.

Assumptions of retail price strategy and price tactic decisions

This licentiate thesis sets out to analyse how a retail price decision frame can be understood. It is argued that it is possible to view price determination within retailing by determining the level of rationality and using behavioural theories. In this way, it is possible to use assumptions derived from economics and marketing to establish a decision frame. By taking a management perspective, it is possible to take into consideration how it is assumed that the retailer should strategically manage price decisions, which decisions might be assumed to be price decisions, and which decisions can be assumed to be under the control of the retailer. Theoretically, this licentiate thesis has its foundations in different assumptions about decision frames regarding the level of information collected, the goal of the decisions, and the outcomes of the decisions. Since the concepts that are to be analysed within this thesis are price decisions, the latter part of the theory discusses price decision in specific: sequential price decisions, at the point of the decision, and trade-offs when making a decision. Here, it is evident that a conceptual decision frame that is intended to illustrate price decisions includes several aspects: several decision alternatives and what assumptions of rationality that can be made in relation to the decision frame. A semi-structured literature review was conducted. As a result, it became apparent that two important things in the decision frame were unclear: time assumptions regarding the decisions and the amount of information that is assumed in relation to the different decision alternatives. By using the same articles that were used to adjust the decision frame, a topical study was made in order to determine the time specific assumptions, as well as the analytical level based on the assumed information necessary for individual decision alternatives. This, together with an experimental study, was necessary to be able to discuss the consequences of the rationality assumption. When the retail literature is analysed for the level of rationality and consequences of assuming certain assumptions of rationality, three main things becomes apparent. First, the level of rationality or the assumptions of rationality are seldom made or accounted for in the literature. In fact, there are indications that perfect and bounded rationality assumptions are used simultaneously within studies. Second, although bounded rationality is a recognised theoretical perspective, very few articles seem to use these assumptions. Third, since the outcome of a price decision seems to provide no incremental sale, it is questionable which assumptions of rationality that should be used. It might even be the case that no assumptions of rationality at all should be used. In a broader perspective, the findings from this licentiate thesis show that the assumptions of rationality within retail research is unclear. There is an imbalance between the perspectives used, where the main assumptions seem to be concentrated to perfect rationality. However, it is suggested that by clarifying which assumptions of rationality that is used and using bounded rationality assumptions within research would result in a clearer picture of the multifaceted price decisions that could be assumed within retailing. The theoretical contribution of this thesis mainly surround the identification of how the level of rationality provides limiting assumptions within retail research. Furthermore, since indications show that learning might not occur within this specific context it is questioned whether the basic learning assumption within bounded rationality should be used in this context.

Evaluating consumer price perception: a mental accounting and frame dependent perspective

In this thesis, we evaluate consumer purchase behaviour from the perspective of heuristic decision making. Heuristic decision processes are quick and easy mental shortcuts, adopted by individuals to reduce the amount of time spent in decision making. In particular, we examine those heuristics which are caused by framing – prospect theory and mental accounting, and examine these within price related decision scenarios. The impact of price framing on consumer behaviour has been studied under the broad umbrella of reference price, which suggests that decision makers use reference points as standards of comparison when making a purchase decision. We investigate four reference points - a retailer's past prices, a competitor's current prices, a competitor's past prices, and consumers' expectation of immediate future price changes, to further our understanding of the impact of price framing on mental accounting, and in turn, contribute to the growing body of reference price literature in Marketing research. We carry out experiments in which levels of price frame and monetary outcomes are manipulated in repeated measures analysis of variance (ANOVA). Our results show that where these reference points are clearly specified in decision problems, price framing significantly affects consumers' perceptions of monetary gains derived through discounts, and leads to reversals in consumer preferences. We also found that monetary losses were not sensitive to price frame manipulations.

Remediation strategies of shaft and common mode voltages in adjustable speed drive systems

AC motors are largely used in a wide range of modern systems, from household appliances to automated industry applications such as: ventilations systems, fans, pumps, conveyors and machine tool drives. Inverters are widely used in industrial and commercial applications due to the growing need for speed control in ASD systems. Fast switching transients and the common mode voltage, in interaction with parasitic capacitive couplings, may cause many unwanted problems in the ASD applications. These include shaft voltage and leakage currents. One of the inherent characteristics of Pulse Width Modulation (PWM) techniques is the generation of the common mode voltage, which is defined as the voltage between the electrical neutral of the inverter output and the ground. Shaft voltage can cause bearing currents when it exceeds the amount of breakdown voltage level of the thin lubricant film between the inner and outer rings of the bearing. This phenomenon is the main reason for early bearing failures. A rapid development in power switches technology has lead to a drastic decrement of switching rise and fall times. Because there is considerable capacitance between the stator windings and the frame, there can be a significant capacitive current (ground current escaping to earth through stray capacitors inside a motor) if the common mode voltage has high frequency components. This current leads to noises and Electromagnetic Interferences (EMI) issues in motor drive systems. These problems have been dealt with using a variety of methods which have been reported in the literature. However, cost and maintenance issues have prevented these methods from being widely accepted. Extra cost or rating of the inverter switches is usually the price to pay for such approaches. Thus, the determination of cost-effective techniques for shaft and common mode voltage reduction in ASD systems, with the focus on the first step of the design process, is the targeted scope of this thesis. An introduction to this research – including a description of the research problem, the literature review and an account of the research progress linking the research papers – is presented in Chapter 1. Electrical power generation from renewable energy sources, such as wind energy systems, has become a crucial issue because of environmental problems and a predicted future shortage of traditional energy sources. Thus, Chapter 2 focuses on the shaft voltage analysis of stator-fed induction generators (IG) and Doubly Fed Induction Generators DFIGs in wind turbine applications. This shaft voltage analysis includes: topologies, high frequency modelling, calculation and mitigation techniques. A back-to-back AC-DC-AC converter is investigated in terms of shaft voltage generation in a DFIG. Different topologies of LC filter placement are analysed in an effort to eliminate the shaft voltage. Different capacitive couplings exist in the motor/generator structure and any change in design parameters affects the capacitive couplings. Thus, an appropriate design for AC motors should lead to the smallest possible shaft voltage. Calculation of the shaft voltage based on different capacitive couplings, and an investigation of the effects of different design parameters are discussed in Chapter 3. This is achieved through 2-D and 3-D finite element simulation and experimental analysis. End-winding parameters of the motor are also effective factors in the calculation of the shaft voltage and have not been taken into account in previous reported studies. Calculation of the end-winding capacitances is rather complex because of the diversity of end winding shapes and the complexity of their geometry. A comprehensive analysis of these capacitances has been carried out with 3-D finite element simulations and experimental studies to determine their effective design parameters. These are documented in Chapter 4. Results of this analysis show that, by choosing appropriate design parameters, it is possible to decrease the shaft voltage and resultant bearing current in the primary stage of generator/motor design without using any additional active and passive filter-based techniques. The common mode voltage is defined by a switching pattern and, by using the appropriate pattern; the common mode voltage level can be controlled. Therefore, any PWM pattern which eliminates or minimizes the common mode voltage will be an effective shaft voltage reduction technique. Thus, common mode voltage reduction of a three-phase AC motor supplied with a single-phase diode rectifier is the focus of Chapter 5. The proposed strategy is mainly based on proper utilization of the zero vectors. Multilevel inverters are also used in ASD systems which have more voltage levels and switching states, and can provide more possibilities to reduce common mode voltage. A description of common mode voltage of multilevel inverters is investigated in Chapter 6. Chapter 7 investigates the elimination techniques of the shaft voltage in a DFIG based on the methods presented in the literature by the use of simulation results. However, it could be shown that every solution to reduce the shaft voltage in DFIG systems has its own characteristics, and these have to be taken into account in determining the most effective strategy. Calculation of the capacitive coupling and electric fields between the outer and inner races and the balls at different motor speeds in symmetrical and asymmetrical shaft and balls positions is discussed in Chapter 8. The analysis is carried out using finite element simulations to determine the conditions which will increase the probability of high rates of bearing failure due to current discharges through the balls and races.

A method for systematically pooling data in very early stage construction price forecasting

Client owners usually need an estimate or forecast of their likely building costs in advance of detailed design in order to confirm the financial feasibility of their projects. Because of their timing in the project life cycle, these early stage forecasts are characterized by the minimal amount of information available concerning the new (target) project to the point that often only its size and type are known. One approach is to use the mean contract sum of a sample, or base group, of previous projects of a similar type and size to the project for which the estimate is needed. Bernoulli’s law of large numbers implies that this base group should be as large as possible. However, increasing the size of the base group inevitably involves including projects that are less and less similar to the target project. Deciding on the optimal number of base group projects is known as the homogeneity or pooling problem. A method of solving the homogeneity problem is described involving the use of closed form equations to compare three different sampling arrangements of previous projects for their simulated forecasting ability by a cross-validation method, where a series of targets are extracted, with replacement, from the groups and compared with the mean value of the projects in the base groups. The procedure is then demonstrated with 450 Hong Kong projects (with different project types: Residential, Commercial centre, Car parking, Social community centre, School, Office, Hotel, Industrial, University and Hospital) clustered into base groups according to their type and size.

Comparing the availability, price, variety and quality of fruits and vegetables across retail outlets and by area level socioeconomic position

Abstract Objective: To explore whether area-level socioeconomic position or the form of retail stream (conventional versus farmers’ market) are associated with differences in the price, availability, variety and quality of a range of fresh fruit and vegetables. Design: A multi-site cross-sectional pilot study of farmers’ markets, supermarkets and independent fruit and vegetable retailers. Each was surveyed to assess the price, availability, variety and quality of 15 fruit and 18 vegetable items. Setting: Retail outlets were located in South-East Queensland. Subjects: Fifteen retail outlets were surveyed (five of each retail stream). Results: Average basket prices were not significantly different across the socioeconomic spectrum however prices in low socioeconomic areas were cheapest. Availability, variety, and quality did not differ across levels of socioeconomic position however the areas with the most socioeconomic disadvantage scored poorest for quality and variety. Supermarkets had significantly better fruit and vegetable availability than farmers’ markets however price, variety and quality scores were not different across retail streams. Results demonstrate a trend to fruit and vegetable prices being more expensive at farmers’ markets, with the price of the Fruit basket being significantly greater at the organic farmer’s market compared with the non-organic farmers’ markets. Conclusions: Neither area-level socioeconomic position nor the form of retail stream was significantly associated with differences in the availability, price, variety and quality of fruit and vegetables, except for availability which was higher in supermarkets than farmers’ markets. Further research is needed to determine what role farmers’ markets can play in affecting fruit and vegetable intake.

Dimensions of the venture creation process : amount, dynamics, and sequences of action in nascent entrepreneurship

This research examines the entrepreneurship phenomenon, and the question: Why are some venture attempts more successful than others? This question is not a new one. Prior research has answered this by describing those that engage in nascent entrepreneurship. Yet, this approach yielded little consensus and offers little comfort for those newly considering venture creation (Gartner, 1988). Rather, this research considers the process of venture creation, by focusing on the actions of nascent entrepreneurs. However, the venture creation process is complex (Liao, Welsch, & Tan, 2005), and multi-dimensional (Davidsson, 2004). The process can vary in the amount of action engaged by the entrepreneur; the temporal dynamics of how action is enacted (Lichtenstein, Carter, Dooley, and Gartner 2007); or the sequence in which actions are undertaken. And little is known about whether any, or all three, of these dimensions matter. Further, there exists scant general knowledge about how the venture creation process influences venture creation outcomes (Gartner & Shaver, 2011). Therefore, this research conducts a systematic study of what entrepreneurs do as they create a new venture. The primary goal is to develop general principles so that advice may be offered on how to ‘proceed’, rather than how to ‘be’. Three integrated empirical studies were conducted that separately focus on each of the interrelated dimensions. The basis for this was a randomly sampled, longitudinal panel, of nascent ventures. Upon recruitment these ventures were in the process of being created, but yet to be established as new businesses. The ventures were tracked one year latter to follow up on outcomes. Accordingly, this research makes the following original contributions to knowledge. First, the findings suggest that all three of the dimensions play an important role: action, dynamics, and sequence. This implies that future research should take a multi-dimensional view of the venture creation process. Failing to do so can only result in a limited understanding of a complex phenomenon. Second, action is the fundamental means through which venture creation is achieved. Simply put, more active venture creation efforts are more likely more successful. Further, action is the medium which allows resource endowments their effect upon venture outcomes. Third, the dynamics of how venture creation plays out over time is also influential. Here, a process with a high rate of action which increases in intensity will more likely achieve positive outcomes. Forth, sequence analysis, suggests that the order in which actions are taken will also drive outcomes. Although venture creation generally flows in sequence from discovery toward exploitation (Shane & Venkataraman, 2000; Eckhardt & Shane, 2003; Shane, 2003), processes that actually proceed in this way are less likely to be realized. Instead, processes which specifically intertwine discovery and exploitation action together in symbiosis more likely achieve better outcomes (Sarasvathy, 2001; Baker, Miner, & Eesley, 2003). Further, an optimal venture creation order exists somewhere between these sequential and symbiotic process archetypes. A process which starts out as symbiotic discovery and exploitation, but switches to focus exclusively on exploitation later on is most likely to achieve venture creation. These sequence findings are unique, and suggest future integration between opposing theories for order in venture creation.

The effect of project information on the accuracy of building price forecasts

A fundamental proposition is that the accuracy of the designer's tender price forecasts is positively correlated with the amount of information available for that project. The paper describes an empirical study of the effects of the quantity of information available on practicing Quantity Surveyors' forecasting accuracy. The methodology involved the surveyors repeatedly revising tender price forecasts on receipt of chunks of project information. Each of twelve surveyors undertook two projects and selected information chunks from a total of sixteen information types. The analysis indicated marked differences in accuracy between different project types and experts/non-experts. The expert surveyors' forecasts were not found to be significantly improved by information other than that of basic building type and size, even after eliminating project type effects. The expert surveyors' forecasts based on the knowledge of building type and size alone were, however, found to be of similar accuracy to that of average practitioners pricing full bills of quantities.

Heuristics and building price forecasting

The construction industry contains two types of estimators the contractors' estimator and the designers' price forecaster. Each has two models of the building in which to systemize his procedures - the production model and the design model. The use of these models is discussed in the light of the industry's particular problems of complexity and uncertainty together with the pressures of the market. It is argued that estimators and forecasters, in order to function effectively in these conditions, are forced to exercise a high degree of subjective judgment. Means of eliciting good heuristics involved in judgment making are considered by reference to the artificial intelligence and construction literature and a methodology is proposed based on these findings. The results of two early trials of the method with students are given, indicating the usefulness of the approach.