Journal Article The Badly Behaved Production Function: A Further Comment Get access Gregory J. L. Yi Gregory J. L. Yi West Virginia University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 89, Issue 2, May 1975, Pages 341–343, https://doi.org/10.2307/1884440 Published: 01 May 1975
This paper examines the robustness of one month treasury bills as predictors of inflation. The evidence is inconsistent with the joint hypothesis that (1) the expected real rate of interest was constant for one-month bills and (2) that markets are efficient with regard to the time series of inflation. When the expected real rate of interest is set equal to the conditional expectation given the time series of real rates, the results are much more consistent with the efficient markets model. In more positive terms, the failure to confirm market efficiency appears to be the result of naive estimates of the expected real rate.
Abstract The purpose of this article is to provide evidence on the value of government regulation of accounting reports. The banking industry was initially exempt from the disclosure provisions of the Securities Act of 1933 and the Securities and Exchange Act of 1934, because the U.S. Congress apparently felt that the banking industry was already regulated. In 1964, the Securities Acts were amended to require specifically that the Comptroller of the Currency, the Federal Reserve Bank, and the Federal Deposit Insurance Corporation regulate bank financial reporting. To test whether or not the informational content of state bank financial statements increased after the regulations, some surrogate for information must be used, because information itself is not directly measurable. Changes in security prices are commonly used as a proxy for information because stock prices represent weighted averages of investor expectations. The test based on the stable symmetric distribution and the non-parametric test both indicate that the announcement of bank financial data is associated with unexpected price movements which is consistent with the belief that financial statements contain information that investors act on.
Abstract Presents a commentary to the article by Yuji Ijiri and Hiroyuki Itami which used a quadratic cost curve in developing the concept of an information delay loss which they measure as the difference between production costs when information is received early and those incurred when information is received late. Assumption required to point out information delay loss as calculated in the study; How the models of the study were developed; Implications for the information delay loss.
Abstract This article presents response of the author on comments made by scholars Jack Hayya, William Ferrara, and Erwin Saniga on the paper "Extending the Applicability of Probabilistic Management Planning and Control Models" that was published in the January 1974 issue of the periodical "The Accounting Review." One of the main points in the comment seems to revolve around the contention that recent advances in nonparametric statistical tests and the corresponding computer routines have made obsolete the use of Tchebycheff-type inequalities in probabilistic models. There are at least two possible reference points for defining the term obsolete. First, the term can be defined by referencing to the current level of technological feasibility, that is, what does one knows about the problems and techniques under consideration from a purely technological standpoint. Hayya and others are correct in stating that great advances have been made in the area of nonparametric statistics and the related computer routines. These advances have extended the technological feasibility of applying probabilistic planning and control models.
[The standard two-period consumer choice problem, where current consumption must be decided upon subject to uncertainty about future income and prices is considered in this paper. Previous analyses have been limited to an economy where either there is only one commodity or consumer preferences have a restrictive form. The primary objective of this paper is to generalize these analyses so that these limitations are eliminated. This is accomplished by applying the theory of duality.]
In a recent article in this Review, M. L. Greenhut and H. Ohta (G-O) demonstrated that a spatial monopolist who adopts a spatially discriminating price would produce a larger output than under a mill price policy. They raise, without elaboration, the possibility that this larger output corresponds to a greater level of net benefits. The purpose of this paper is to examine a model in which the net benefits of both price policies can be measured and to extend the discussion to the case of competition for market areas-called spatial monopolistic competition in location theory (see Martin Beckmann 1968, 1970, 1971). Section I introduces a model, somewhat simpler than that of G-O, in which the basic result of G-O can be derived and the welfare effects of the two policies can be measured. Here it is found that when there is no significant competition for the firm's market area, spatial price discrimination results in firms producing larger output, serving larger market areas, and promoting greater net benefits than under a mill price policy. Section II then considers spatial monopolistic competition in which extra normal profits invite invasion of market areas. It is shown that the equilibrium firm output and market area will be smaller under spatial price discrimination than under mill pricing and that if price discrimination is allowed, firms will be forced by free entry to adopt that policy. It is also shown that customers buy more when spatial price discrimination is imposed than under mill pricing, but that they are worse off-greater net benefits are derived under mill pricing.