Richard V. Burkhauser, James T. Wilkinson, The Effect of Retirement on Income Distribution: A Comprehensive Income Approach, The Review of Economics and Statistics, Vol. 65, No. 4 (Nov., 1983), pp. 653-658

Linear model and retrospective process tracing methods of judgment modeling are compared in terms of predictive validity and convergence between measures of cue importance, in addition, the reliability of the linear model is examined. The experimental task required each of 31 subjects to provide either a buy or no-buy decision for 45 stocks (each described by six information cues). For each subject, a linear model was estimated and a retrospective process tracing model was generated by reference to post-experimental verbal reports. The results indicated that (1) each approach exhibited predictive validity, but the retrospective process tracings exhibited a superior ability to replicate the observed judgments, (2) linear model and retrospective process tracing measures of cue importance were related (exhibited convergent validity), and (3) the linear models were generally reliable.

This paper develops an equilibrium model in which informational asymmetries about the qualities of products offered for sale are resolved through a mechanism which combines the signalling and costly screening approachs. The model is developed in the context of a capital market setting in which bondholders produce costly information about a firm's priori imperfectly known earnings distribution and use this information in specifyihng a bond valuation schedule to the firm. Given this schedule, the firm's optimal choices of debt-equity ratio and debt maturity structure subsequently signal to prospective shareholders the relevant parameters of the firm's earnings distribution.

This paper develops an equilibrium model in which informational asymmetries about the qualities of products offered for sale are resolved through a mechanism which combines the signalling and costly screening approaches. The model is developed in the context of a capital market setting in which bondholders produce costly information about a firm's a priori imperfectly known earnings distribution and use this information in specifying a bond valuation schedule to the firm. Given this schedule, the firm's optimal choices of debt‐equity ratio and debt maturity structure subsequently signal to prospective shareholders the relevant parameters of the firm's earnings distribution.