How organizations respond to failure (negative feedback) has important implications for subsequent organizational performance. This study focuses on theoretical and empirical distinctions between the ...different potential organizational reactions to failure (in this case around new product development) and how those feedback-driven choices aggregate to affect firm performance. To understand when and why negative feedback is organizationally beneficial, we focus on how possession of domain-specific experience affects the way in which firms interpret and respond to negative feedback, offering both organization- and mechanism-level theories. In particular, we distinguish between conditions that should lead to different behavioral responses to negative feedback: retreat, local search, or distant search. We find support for our theory using data on all U.S. mutual fund companies from 1962 to 2002, and testing both aggregated and mechanism-level theories. Our results show that negative feedback on new funds launched in new domains is particularly damaging to subsequent organizational performance, as firms retreat from the unknown in favor of already exploited domains. In contrast, negative feedback in experienced domains can produce positive outcomes by encouraging action to search for both local solutions to correct the problem and distant solutions to expand the firm's opportunities.
Investor Overconfidence and Trading Volume Statman, Meir; Thorley, Steven; Vorkink, Keith
The Review of financial studies,
12/2006, Letnik:
19, Številka:
4
Journal Article
Recenzirano
The proposition that investors are overconfident about their valuation and trading skills can explain high observed trading volume. With biased self-attribution, the level of investor overconfidence ...and thus trading volume varies with past returns. We test the trading volume predictions of formal overconfidence models and find that share turnover is positively related to lagged returns for many months. The relationship holds for both market-wide and individual security turnover, which we interpret as evidence of investor overconfidence and the disposition effect, respectively. Security volume is more responsive to market return shocks than to security return shocks, and both relationships are more pronounced in small-cap stocks and in earlier periods where individual investors hold a greater proportion of shares.
This paper documents a strong relationship between short-run reversals and stock illiquidity, even after controlling for trading volume. The largest reversals and the potential contrarian trading ...strategy profits occur in high turnover, low liquidity stocks, as the price pressures caused by non-informational demands for immediacy are accommodated. However, the contrarian trading strategy profits are smaller than the likely transactions costs. This lack of profitability and the fact that the overall findings are consistent with rational equilibrium paradigms suggest that the violation of the efficient market hypothesis due to short-term reversals is not so egregious after all.
This paper examines the intertemporal relation between risk and return for the aggregate stock market using high-frequency data. We use daily realized, GARCH, implied, and range-based volatility ...estimators to determine the existence and significance of a risk-return trade-off for several stock market indices. We find a positive and statistically significant relation between the conditional mean and conditional volatility of market returns at the daily level. This result is robust to alternative specifications of the volatility process, across different measures of market return and sample periods, and after controlling for macro-economic variables associated with business cycle fluctuations. We also analyze the risk-return relationship over time using rolling regressions, and find that the strong positive relation persists throughout our sample period. The market risk measures adopted in the paper add power to the analysis by incorporating valuable information, either by taking advantage of high-frequency intraday data (in the case of realized, GARCH, and range volatility) or by utilizing the market's expectation of future volatility (in the case of implied volatility index).
This study investigates the effects of GDP per capita on infant mortality using panel data from 83 developing countries over a period of 40 years. Although economic growth broadly decreases infant ...mortality, the impact of economic growth on infant mortality for the periods of economic booms and slumps is asymmetrical. Positive economic growth may have weak, mixed effects on a reduction in infant mortality, but negative economic growth has a strong, adverse impact.
Cette étude explore les effets du PIB par tête sur la mortalité infantile, en mobilisant des données de panel recueillies dans 83 pays en développement, sur une période de 40 années. Bien que la croissance économique diminue, dans l’ensemble, la mortalité infantile, l’impact de la croissance économique sur la mortalité infantile en période de boum économique d’une part et en période de crise d’autre part, est asymétrique. Une croissance économique positive peut avoir des effets faibles et mitigés sur la mortalité infantile, alors qu’une croissance économique négative a des effets négatifs importants.
We estimate a time-varying coefficient VAR model for the US economy to analyse (i) if the effect of monetary policy on output has been changing systematically over time, and (ii) if monetary policy ...has asymmetric effects over the business cycle. We find that the impact of monetary policy shocks has been gradually declining over the sample period (1962 to 2002), as some theories of the monetary transmission mechanism imply. In addition, our results indicate that the effects of monetary policy are greater in a recession than in a boom.
Reliable forecasts of life expectancies are of importance for the financial stability of social security systems and the life insurance industry. A discretetime stochastic process and a ...continuous-time stochastic process are proposed to model the dynamics of German mortality rates from which life expectancies are calculated. More precisely, a panel data model is utilized, which distinguishes between a common time effect and a common age effect. The model is easy to fit, yields interpretable parameters, and allows for a simple analysis of the forecast error. The main applications of the model are the forecast of mortality rates—and the resulting life expectancies—and the pricing of mortality derivatives.
The effects of migrating seniors on the provision of local public services in rural communities is growing in importance because of the large number of retiring baby boomers and the increasing rate ...at which these retirees are locating outside traditional retirement destinations. Some communities are optimistic about attracting and retaining retirees as an economic development strategy, but others are concerned that inmigrating seniors may be reluctant to support local public services, such as education, bringing with them "Gray Peril." This article attempts to clarify questions regarding the Gray Peril hypothesis and local ability and willingness to fund education in Tennessee, an increasingly popular retirement destination. To this end, county per pupil education expenditure growth is explained by growth trends in local property tax assessment and sales tax revenue, and migration patterns of the retirement-aged population from 1962 to 2002.
A speech by Peter J. Fowler, the president of the American Orthopaedic Society for Sports Medicine, presented at teh 30th annual meeting of the AOSSM in San Diego CA in July 2003 is presented. in his ...speech, he touches briefly on three topics: subsspecialty certification, the Americam Journal of Sports Medicine, and the legacy of Alexandra Kirkley, a colleague who died in a small-plane crash.
This paper examines the cyclical interactions between the remittances of Turkish workers in Germany and output in both Turkey and Germany. Our analysis introduces a new data set covering 1962 to ...2004, never used before in the research literature and considered to be a more reliable source than the data sets used in other studies. By dividing the original sample into recruitment, family reunification, and naturalization periods, we show that the duration of migrants' stay in the host country affects the direction and strength of the relation between remittances and the host and home countries' business cycles.
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