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Information Production and Capital Allocation : Decentralized vs. Hierarchical Firms

Stein, Jeremy C. - 2000

This paper assesses different organizational forms in terms of their ability to generate information about investment … likely to be attractive when information about individual projects is soft' and cannot be credibly transmitted. Moreover …, holding fixed firm size, soft information also favors flatter organizations with fewer layers of management. In contrast …

Persistent link: https://www.econbiz.de/10012471056

Forecasting Crashes : Trading Volume, Past Returns and Conditional Skewness in Stock Prices

Chen, Joseph - 2000

This paper is an investigation into the determinants of asymmetries in stock returns. We develop a series of cross-sectional regression specifications which attempt to forecast skewness in the daily returns of individual stocks. Negative skewness is most pronounced in stocks that have...

Persistent link: https://www.econbiz.de/10012471074

Social Interaction and Stock-Market Participation

Hong, Harrison - 2001

We investigate the idea that stock-market participation is influenced by social interaction. We build a simple model in which any given 'social' investor finds it more attractive to invest in the market when the participation rate among his peers is higher. The model predicts higher...

Persistent link: https://www.econbiz.de/10012470362

Policy Rules for Inflation Targeting

Rudebusch, Glenn D. - 1998

Policy rules that are consistent with inflation targeting are examined in a small macroeconomic model of the US economy. We compare the properties and outcomes of explicit instrument rules' as well as targeting rules.' The latter, which imply implicit instrument rules, may be closer to actual...

Persistent link: https://www.econbiz.de/10012472292

Breadth of Ownership and Stock Returns

Chen, Joseph - 2001

We develop a model of stock prices in which there are both differences of opinion among investors as well as short-sales constraints. The key insight that emerges is that breadth of ownership is a valuation indicator. When breadth is low i.e., when few investors have long positions in the stock...

Persistent link: https://www.econbiz.de/10012470575

Open-Economy Inflation Targeting

Svensson, Lars E. O. - 2000

The paper extends previous analysis of closed-economy inflation targeting to a small open economy with forward-looking aggregate supply and demand with some microfoundations, and with stylized realistic lags in the different transmission channels for monetary policy. The paper compares targeting...

Persistent link: https://www.econbiz.de/10012471032

Differences of Opinion, Rational Arbitrage and Market Crashes

Hong, Harrison - 1999

-sales constraints, bearish investors do not initially participate in the market and their information is not revealed in prices. However … information tends to come out during market declines. The model helps explain a variety of stylized facts, including: 1) large …

Persistent link: https://www.econbiz.de/10012471408

Banks as Liquidity Providers : An Explanation for the Co-Existence of Lending and Deposit-Taking

Kashyap, Anil K. - 1999

This paper addresses the following question: what ties together the traditional commercial banking activities of deposit-taking and lending? We begin by observing that since banks often lend via commitments, or credit lines, their lending and deposit-taking may be two manifestations of the same...

Persistent link: https://www.econbiz.de/10012471845

A Quantity-Driven Theory of Term Premia and Exchange Rates

Greenwood, Robin - 2020

We develop a model in which specialized bond investors must absorb shocks to the supply and demand for long-term bonds in two currencies. Since long-term bonds and foreign exchange are both exposed to unexpected movements in short-term interest rates, a shift in the supply of long-term bonds in...

Persistent link: https://www.econbiz.de/10012481468

The Economics of Cultural Transmission and Socialization

Bisin, Alberto - 2010

Cultural transmission arguably plays an important role in the determination of many fundamental preference traits (e.g., discounting, risk aversion and altruism) and most cultural traits, social norms, and ideological tenets ( e.g., attitudes towards family and fertility practices, and attitudes...

Persistent link: https://www.econbiz.de/10012462145