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Consumer return policies have been long recognized and studied by operations management scholars as an important managerial lever in a retail environment. Yet, the behavioral aspects of return policy decision-making and interaction of return policy decisions with other common operational...
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$1. The elasticity of white-collar wages with respect to equity returns is one-third smaller than the CEO salary …We present empirical evidence on the relationship between individual wages, conditional on worker characteristics, and … equity returns using a unique survey from the Bureau of Labor Statistics. Equity returns affect the wages only of workers …
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Despite their popularity as proxies of expected returns, the implied cost of capital's (ICC) measurement error properties are relatively unknown. Through an in-depth analysis of a popular implementation of ICCs by Gebhardt, Lee, and Swaminathan (2001) (GLS), I show that ICC measurement errors...
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Exponential-growth bias is the tendency to neglect the compounding of interest. The economics literature has used the fact that a biased agent in many circumstances will underestimate the value of assets that grow according to compound interest. We show that the opposite can also be true. It is...
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Weakening bargaining power of unions and the increasing integration of the world economy may affect the volatility of capital and labor incomes. This paper documents and explains changes in income volatility. Using a theoretical framework which builds distribution risk into a real business cycle...
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