97-0100
97-0101
Finance professors rarely study how students learn finance. This leads
to a relatively low awareness of how students learn, which in turn
provides a foundation for studying student learning styles. The paper
presents an overview of the learning style literature with a focus on
Gregorc's learning style theory. This empirical study collects the
learning styles of 483 undergraduate students from three universities.
A hierarchical loglinear model is used to test various hypotheses on
the relationship among students' sex, race, major and learning style.
The analysis shows there is no difference in the learning styles of
African Americans and Caucasians. It also indicates the learning
styles of female students are significantly different from male
students. Likewise, the study shows a significant difference exists
between student race and the selection of an academic major. The
results of the study suggest numerous challenges to our profession
concerning the need to provide an equitable learning experience for
all students enrolled in finance courses. Finally the study has
profound implications for faculty development, as well as
instructional and curricula development.
97-0102
Latin American governments increasingly want to attract external
capital to increase economic growth and adjust to external shocks.
However, their concurrent desire to retain national sovereignty has
frequently conflicted with the aim of creditors to receive payment for
providing this capital. First, this paper examines how the
participation of official and private sector actors, ability of these
actors to coordinate their actions, form and maturity structure of
external capital and existing political and international monetary
environment have influenced the conditions demanded by creditors and
the willingness of Latin American governments to accept constraints on
national sovereignty during episodes of capital inflows since
independence in the 1820s. Second, we investigate how the changing
nature of creditor demands, new forms of capital inflows, implicit
government guarantees and international monetary environment since
1990 influence the constraints placed on policy makers in the
aftermath of the Mexican crisis.
97-0103
We consider a local public goods economy with differential crowding in
which agents are distinguished by their tastes and genetic endowments.
Agents choose which crowding characteristic they wish to express, and
this affects their value to other members of their jurisdiction. An
agent's choice is influenced both by his genetic endowment, which
affects his cost of acquiring any given crowding characteristic, and
his preference over which crowding characteristic he expresses. For
example, an agent may find it very easy to learn accounting but may
strongly desire to be an artist. We show that in general jurisdictions
in the core will not be taste-homogeneous. This contrasts with earlier
results for models with endogenous crowding types. We also show that
the core is equivalent to the set of anonymous competitive equilibrium
outcomes. This implies that the market will not allow agents to be
discriminated against on the basis of genetic endowments; the only
feature of an agent that is relevant to the market is the crowding
characteristic that an agent chooses to express.
97-0104
97-0105
97-0106
97-0107
This paper adds a land market to a standard Harris-Todaro framework.
In the standard model, the equilibrating force that limits rural-urban
migration is a decline in the probability of formal employment, which
follows from enlargement of the informal sector. The key insight of
the present paper, borrowed from Brueckner (1990), is that urban
land-rent escalation provides an additional force that limits the
extent of migration. The most striking implication of this modified
model is that formal-sector growth may not lead to additional
migration from rural areas. The reason is that, because of land-rent
escalation, such growth may depress a migrant's expected utility
despite the improved chance of obtaining formal job. In the second
part of the analysis, the efficiency-wage model is used to make wages
and employment in the formal sector endogenous instead of fixed. While
many comparative-static effects are ambiguous in this more-complex
model, the role of the land market is basically unaffacted.
97-0108
A rapid penetration of PCs and eased accessibility of Internet
infrastructure fuels the digitization of products (e.g. newspapers)
and services (e.g. voice communications) and is creating the
opportunity to develop, build, and operate a new utility facilitating
electronic markets and electronic commerce which is referred to as
Digital Interactive Services (DIS). Many companies from the four
industries of content, communications, computing and financial
services are trying to seize the DIS opportunity by aligning
capabilities and assets through mergers and acquisitions, which is
referred to as convergence of information industries. Many companies
in these industries and in particular the ones with size advantages
feel more comfortable to "sit and wait" until more stable
structures evolve. But considering increasing returns economics and
positive network externalities inherent in DIS activities and instant
global scale, early hesitation might result in an outright loss of the
entire business opportunity. In this paper, we suggest a framework
that aims at providing insights into the emerging structures of DIS
which are in turn the foundation for strategy formulation. The
framework consists of a generic concept for value creation and
delivery in DIS referred to as the "2-3-6" concept and the
definition of dynamic patterns such as strategic roles on top of it
and will be applied in the context of electronic publishing (EP).
97-0109
Rao's (1947) seminal paper introduced a fundamental principle of
testing based on the score function as an alternative to likelihood
ratio and Wald tests. Neyman's (1959) approach, in view of the
presence of nuisance parameters, emphasized the generality and
attractive features of the score-based tests. Silvey (1959)
rediscovered the score test as a Lagrange multiplier test. In later
years, Breusch and Pagan's (1980) exposition of score test in a
general framework in the context of econometric modeling resulted in
an increased activity on specification testing in econometrics. In
this paper we trace these historical developments emphasizing
optimality features of tests based on scores and their usefulness in
practical problems in statistics and econometrics. In so doing we give
some new results, present easier computation of score-based tests and
alternative derivaitons of some known results. We also discuss a
connection between Rao's score test and the seemingly unrelated
literature of Fisher's discriminant function, Mahlanobis' D2 and
Hotelling's T2.
97-0110
Are there economic incentives for electronic commerce, or is it just
hype? This paper evaluates the cost-based differences between
traditional markets (such as retail stores) and electronic markets
both from the buyer (demand side) perspective and the seller (supply
side) perspective. A cost-based model that differentiates between
traditional and electronic markets identified, and an empirical,
survey-based, study that provides support for the model is discussed.
This paper discusses the implications that a shift toward greater
electronic market utilization have for transaction intermediaries,
interactive service providers (ISPs), and government. We find that
there are significant cost-based differences between traditional and
electronic markets for buyers, and that electronic markets affect
future sources of organization revenue.
97-0111
The greater the benefit from cornering an auction, the more
enforcement is needed to deter cornering. We presume that there is
just enough enforcement to deter cornering attempts and rank three
difference auctions by their expected revenue net of enforcement
costs. We consider three different types of auctions: the pay-your-bid
or "discriminatory" auction commonly used by the US
Treasury, the lowest-winning-bid uniform-price auction used in the
current Treasury experiment, and the highest-losing-bid uniform-price
auction proposed by Friedman almost four decades ago. We show that the
Friedman auction generates the greatest expected revenue net of
enforcement costs, the experimental Treasury auction generates less
expected net revenue, and the pay-your-bid auction generates the
least.
97-0112
In the newsvendor problem, a decision maker facing random demand for a
perishable product decides how much of it to stock for a single
selling period. This simple problem with its intuitively appealing
solution is a crucial building block of stochastic inventory theory,
which comprises a vast literature focusing on operational efficiency.
Typically in this literature, market parameters such as demand and
selling price are exogenous. However, incorporating these factors into
the model can provide an excellent vehicle for examining how
operational problems interact with marketing issues to influence
decision making at the firm level. In this paper we examine an
extension of the newsvendor problem in which stocking quantity and
selling price are set simultaneously. Drawing on a fragmented
literature in operations management and economics, we provide a
comprehensive review that synthesizes existing results for the single
period problem and develop additional results to enrich the existing
knowledge base. We also include a review of multiple period variants
of this model and identify promising areas of research.
97-0113
Optimal operating policies and corresponding managerial insight are
developed for a firm that establishes dynamically a stocking level and
a selling price for its product while exploiting information gathered
from ongoing operations. Given a management situation in which the
demand function depends on selling price and includes an unknown scale
parameter, learning occurs as the firm monitors the market's response
to its decisions and then updates its characterization of the demand
function. Of primary interest is the effect of censored data since a
firm's observations often are restricted to sales. We find that the
first-period optimal selling price increases with the length of the
problem horizon. However, for a given problem horizon, prices can rise
or fall over time, depending on how the scale parameter influences
demand. Further results include the characterization of the optimal
stocking quantity decision and a computationally viable algorithm.
97-0114
Adopting a network perspective, this research proposes that the firm's
network of interfirm linkages (e.g., strategic alliances) is a
significant influence on its resource and competitive flexibility.
Based on evidence from the global steel industry, it is argued that
network properties may be managerial "levers" for enhancing
strategic flexibility.
97-0115
This paper analyzes the effects of international airline codesharing
on traffic levels and welfare. The benefits of codesharing arise
because cooperative pricing of trips by the codesharing partners puts
downward pressure on fares in the interline markets. The loss of
competition in the interhub market, which connects the hub cities of
the partners, generates a countervailing effect, tending to raise the
fare in that market. Evaluating the net impact of these countervailing
forces is not straightforward because the relevant markets are served
via a hub-and-spoke network that carries endogenous traffic flows in
many other markets. The analysis shows that the beneficial effect of
codesharing outweights its harmful effect for most parameter values. .
97-0116
Since their introduction to the social sciences in the 1960s, theories
of innovation diffusion have sparked considerable research interest
and resulted in an extensive literature. Although it is recognized
that the diffusion of innovation within a system is fundamentally a
process of communication within a social network, diffusion models
have not directly incorporated the structural properties of a network.
Based on the network and innovation literatures, we develop hypotheses
linking structural properties to innovation and imitation potential.
The hypothesized relationships form the basis for the analytical model
developed in this paper, linking the diffusion parameters (innovation
and imitation coefficients) to the structural properties of the
network. Research and managerial implications of our model are
discussed.
97-0117
97-0118
Though the prepurchase effects of advertising on children are
well-documented, little is known about advertising's impact in
consumption settings. Three studies, combining both experimentation
and depth interviews are reported to examine this issue. Based on our
preliminary findings, special emphasis was placed on the role
affective constructs play in shaping children's impressions. Although
theory suggests that as children mature they become increasingly
willing to discount ad claims, experimental results indicated that it
was older children (10-11 year-olds) who allowed advertisements to
influence their interpretations and evaluations of trial experiences
more so than younger children (7-8 year-olds). Depth interviews
allowed us to enrich our understanding of this phenomenon.
Implications of these unanticipated age-related findings are
phenomenon. Implications of these unanticipated age-related findings
are discussed and examined in light of opinions and reactions provided
by a set of leading children's advertising researchers.
97-0119
This study uses an agency and transaction cost approach to delineate
the elements of new contract choices in crop production, and to test
the approach based on responses by grain farmers to simulated decision
situations in which preferences are ordered across contract choices
that differ in asset specificity, uncertainty, and risk and cost
sharing with contractors. The statistical results indicate that asset
specificity significantly influences farmers' choice of contractual
arrangements, while uncertainty, interactions between asset
specificity and uncertainty, and selected farmer characteristics are
significant in pricing behavior and the choice of hybrid contracts.
97-0120
97-0121
We consider multivariate tests for cointegration where there are
additional cointegrating vectors under the alternative hypothesis.
These cointegrating vectors are obscured by the existence of multiple
breaks in the deterministic components of the process. The test is
based on the suprmem of likelihood ratio statistics calculated over a
subset of all possible break points. The asymptotic distribution of
the proposed statistic is similar in structure to the likelihood ratio
statistics of Johansen (1988, 1991). A Monte Carlo experiment is
conducted to examine the size and power properties of the proposed
tests. The experiment reveals that the proposed tests are more
powerful than the likelihood ratio tests of Johansen (1991) when there
is a break.
