Elasticities for beer, wine and spirits are estimated for each of the provinces of Canada over the period 1956-83, using unrestricted dynamic regressions modeled after the error-correction mechanism. Alternative long-run estimates are also obtained from cointegrating regressions. Estimates vary markedly across provinces and suggest that increases in price will reduce consumption of all beverages in the short run, but in the long run no evidence is found that spirits use is price-sensitive. Increases in the legal drinking age reduce consumption in the short run but there is little indication of a long-run effect. The estimated income elasticity of beer is small while the estimated income elasticities for spirits and wine are substantially larger, especially in the long run. Coauthors are Ernest H. Oksanen, Michael R. Veall, and Deborah Fretz.

The authors analyze personal open market trades by managers around stock repurchases by tender offer. With the exception of Dutch auction offers, managers trade their firm's shares prior to repurchase announcements as though repurchases convey favorable inside information to outsiders. Prior to fixed price repurchase offers that do not follow takeover-related events, managers increase their buying and reduce their selling of their firm's shares. Prior to repurchases that follow takeover-related events, only a decrease in selling is found. No abnormal trading precedes Dutch auction repurchase offers.

We analyze personal open market trades by managers around stock repurchases by tender offer. With the exception of Dutch auction offers, managers trade their firm's shares prior to repurchase announcements as though repurchases convey favorable inside information to outsiders. Prior to fixed price repurchase offers that do not follow takeover‐related events, managers increase their buying and reduce their selling of their firm's shares. Prior to repurchases that follow takeover‐related events, only a decrease in selling is found. No abnormal trading precedes Dutch auction repurchase offers.

We analyze personal open market trades by managers around stock repurchases by tender offer. With the exception of Dutch auction offers, managers trade their firm's shares prior to repurchase announcements as though repurchases convey favorable inside information to outsiders. Prior to fixed price repurchase offers that do not follow takeover-related events, managers increase their buying and reduce their selling of their firm's shares. Prior to repurchases that follow takeover-related events, only a decrease in selling is found. No abnormal trading precedes Dutch auction repurchase offers.

In his recent paper in this Review, Glenn Harrison (1989) argues that the conclusions of James Cox et al. (1982, 1983, 1985, 1988) in their studies of first-price private-value auctions are not well supported, because of shortcomings in the way their experimental investigations were designed, analyzed, and reported. Harrison argues that the expected cost of deviations from risk-neutral Nash equilibrium (RNNE) bidding in these auctions was quite small (less than $0.05 at the median), so that in terms of expected monetary payoffs (payoff space) many subjects had little to lose from deviating from the RNNE strategy. Harrison suggests that the significance of the differences Cox, Vernon Smith, and James Walker (hereafter CSW) report between subjects' bids and the RNNE bids (deviations in the message space) may therefore need to be reexamined. In discussing Harrison versus CSW we have three primary points to make.' First, in arguing that it is more natural to evaluate subject behavior in expected payoff space (Harrison, 1989 p. 749), we think Harrison has overstated his case. However, we agree with his more important point that looking at the cost of deviations is a useful diagnostic tool for determining when experimenters are likely to have lost control over subjects' incentives. Further, as we will show in Section I, this part of Harrison's critique applies with special force to CSW's studies of bidding. Second, a broader examination of the results of private-value auction experiments indicates that risk aversion cannot be the only factor and may well not be the most important factor behind bidding above the RNNE found so often in first-price privatevalue auctions. The most telling evidence here is bidding above the dominant bid price found in second-price auctions (Kagel et al., 1987; Kagel and Levin, 1990) and the risk-loving found under several treatment conditions in CSW's (1984) own multipleunit discriminative auctions (auctions in which the high bidders pay their bid price). These and other data inconsistent with risk-averse bidding are largely ignored in CSW (1988) but are nevertheless relevant to the substantive issue of risk aversion in private-value auctions. They are discussed in Section II. Third, there are data gathered in other investigations which provide strong support for the view that the deviations from RNNE bidding reported in first-price auctions are not the results of the low expected cost of such deviations. However, these data, unlike the higher-stakes payoff data that CSW offer in response to Harrison, are not consistent with CSW's subsidiary conclusions that the data can be well accounted for by a narrow class of risk-aversion parameters for the bidders, together with the assumption that all agents are playing a Nash equilibrium of the resulting game of incomplete information. A key difference between these experiments and CSW's is that if subjects do not respond to CSW's treatment condition (increasing the payoffs from experimental to U.S. dollars) their behavior will be consistent with CSW's theory. In contrast, * Department of Economics, University of Pittsburgh, Pittsburgh, PA 15260. We thank Jack Ochs and Emilie Roth for thoughtful discussions on earlier drafts of the paper, Jim Cox and Glenn Harrison for helpful comments on the initial draft of the paper, Susan Garvin for research assistance, and Ray Battalio, Carl Kogut, and Don Meyer for providing us with access to their data. Research support was provided by the Information Science and Technology and Economics divisions of the National Science Foundation, the Alfred P. Sloan Foundation, and the Russell Sage Foundation. The usual caveat applies with special force. IWe do not respond to specific comments that CSW (1992) make in response to our comment as, in order to avoid indefinite regress, the ground rules for this debate required us to comment on CSW's criticism of Harrison, after which they would be given the opportunity to respond to our comment.

The behavior of time‐weighted bid–ask spreads over the trading day are examined. The plot of minute‐by‐minute spreads versus time of day has a crude reverse J ‐shaped pattern. Schwartz identifies four determinants of spreads: activity, risk, information, and competition. Using a linear regression model, a significant relationship between these same factors and intraday spreads is demonstrated, but dummy variables for time of day have a reverse J ‐shape. For given values of the activity, risk, information and competition measures, spreads are higher at the beginning and end of the day relative to the interior period.

The behavior of time-weighted bid–ask spreads over the trading day are examined. The plot of minute-by-minute spreads versus time of day has a crude reverse J-shaped pattern. Schwartz identifies four determinants of spreads: activity, risk, information, and competition. Using a linear regression model, a significant relationship between these same factors and intraday spreads is demonstrated, but dummy variables for time of day have a reverse J-shape. For given values of the activity, risk, information and competition measures, spreads are higher at the beginning and end of the day relative to the interior period.

The Home Mortgage Disclosure Act was enacted to monitor minority and low-income access to the mortgage market. The data collected for this purpose show that minorities are more than twice as likely to be denied a mortgage as whites. Yet variables correlated with both race and creditworthiness were omitted from these data, making any conclusion about race's role in mortgage lending impossible. The Federal Reserve Bank of Boston collected additional variables important to the mortgage lending decision and found that race continued to play an important, though significantly diminished, role in the decision to grant a mortgage.