In this paper we study the relationship between costs, input prices and activity levels in a sample of medium sized, city police departments for the years 1968, 69, 71 and 73. Our focus is on determining the functional structure of law enforcement production technology

In this note we correct several misunderstandings which have arisen since publication of our earlier paper “Law Enforcement Agencies as Multiproduct firms: An Econometric Investigation of Production Costs.” These misconceptions arise regularly in empirical applications of economic theory to...

We use a general model to analyze the optimal intertemporal pricing policy for a monopolist when current and past output play a role in determining future cost and/or demand conditions through, "experience," in production and/or in consumption. As would be expected, the optimal price path...

This paper analyzes the behavior of two groups of corporate earnings forecasters: analysts, who follow individual company fortunes, and strategists who predict earnings for various company aggregates. Using data for two market indices, the Samp;P 500 and the Dow Jones Industrial Average, we find...

Analysts' forecasts of earnings play a key role in determining stock market valuations. In recent research, forecast errors have played an important part in explaining momentum and mean-regression effects in asset returns. Given that substantial amounts of wealth ride on the accuracy of these...

Recent empirical research has documented a substantial decrease in average accounting profitability. The phenomenon appears inconsistent with the observation that corporate profit as a fraction of national income as remained stable. This paper shows that the downward trend is fully explicable by...

Recent research in accounting has documented a dramatic increase in the number of firms reporting losses. This increase in losses calls into question the value relevance of earnings numbers. If a firm is likely to be abandoned, its book value will be more relevant than the magnitude of its loss...

In this paper, we examine whether insider share selling in an initial public offering (IPO) influences Ramp;D expenditures. Insiders (managers and venture capitalists) who sell their pre-offering shareholdings might try to increase the IPO offer price (i) by over-investing in Ramp;D to signal...

Recent research in accounting has documented a substantial increase in the number of loss firms. Existing theories on the valuation of loss firms are based on adaptation/abandonment options or limited liability, assuming that these firms are operationally distressed. In this paper, we show that...

In this study, focusing on the period 1996-2010, we conduct an empirical investigation of how warnings by industry peer firms about future earnings affect CEO compensation structure. These warnings contain information about the industry, signaling dim industry prospects and possibly triggering...