Suchergebnisse

AbstractPrevious research shows that stock returns are related to firm market value and earnings yield. This study decomposes the measurements of market value and earnings yield into separate components (share price and shares outstanding for market value, earnings per share and share price for earnings yield) and examines the relationship between stock return and these components. Share price represents approximately three‐fourths of the relationship between stock returns and either market value or earnings yield. Potential causes for this phenomenon are advanced.

Recent studies have examined possible causes of the robust empirical failure of the transitivity axiom of expected utility theory by pitting regret aversion against alternative explanations such as event‐splitting effects. These tests show that cycles replicate when the latter are controlled, but are sensitive to changes in problem representation. The control for event‐splitting effects, however, does not rule out their contribution to cyclical choices in some circumstances. An experiment is reported which investigates this possibility. Cyclical choices are observed that cannot be due to event‐splitting effects, but appear attributable to within‐event and between‐act evaluations of decision problems plus framing effects.

In May 2001 Senator Jim Jeffords left the Republican Party and tipped control of the U.S. Senate to the Democrats. This paper uses the surprise event to demonstrate what I term the "Jeffords effect": changes in the political landscape have large effects on the market value of firms. I use a firm's soft money donations to the national parties as the measure of how the firm aligns itself politically. In this event study of large public firms, a firm lost 0.8% of market capitalization the week of Jeffords' switch for every $250,000 it gave to the Republicans in the previous election cycle. Based on the point estimates, the stock price gain associated with Democratic donations is smaller than the loss associated with Republican donations, but the estimates are consistent with the coefficients being equal and opposite. The results withstand several robustness checks, and the effects appear to persist long after the event. The relationship between soft money and stock returns may or may not be causal: Soft money could be a proxy for how well each party's policies suit a firm, or donations might affect how much help politicians give to a firm.

The term hysteresis effect refers to the shape of a performance curve when plotted against increasing and then decreasing demand. Performance during increasing demand reaches a maximum point and begins to deteriorate at high demand levels, whereas performance during decreasing demand is significantly degraded. The Short-Term Memory, expectancy, and other hypotheses have attempted to explain the hysteresis effect. In this paper it is argued that the hysteresis effect could be described by three phases of cognitive processing: an ideal transmission phase, a varying reaction time phase, and a sampling strategy phase. A mathematical model of human information processing was developed to explore the hypothesis. The model was simulated using the Model Human Processor parameters (S. K. Card, T. P. Moran, & A. Newell, 1983). Experimental results demonstrated each processing phase in reproducing the hysteresis effect. Implications for human-machine systems are discussed. Actual or potential applications of this research include air traffic control, flight deck procedures, and interface design