This paper hypothesizes that the quit propensity of married men rises with an increase in their wives' income. Assuming that individuals are risk averse and that quitting is risky, the wife's income increases the husband's expected value of quitting by reducing the variance of expected family income. Using the longitudinal data from the Michigan Panel Study of Income Dynamics (PSID), the wife's income is found to have a large effect on quits. The average husband's quit rate increases by about 45% when the wife's income rises from zero to two-thirds that of the husband's. The wife's income effect nearly offsets the negative effect that marriage typically has on male quit rates.

This paper provides a framework and some empirical evidence to evaluate the seriousness of problems in inference that arise in stockreturn-based studies when the data are cross-sectionally dependent. The study is motivated on the grounds that statistical procedures designed to address such problems are often infeasible, and even when they can be implemented they sometimes introduce other more serious difficulties. Thus, researchers have frequently adopted an approach that ignores the cross-sectional dependence (e.g., ordinary least squares [OLS]). The objective of this paper is to help identify the contexts in which ignoring the dependence would lead to serious misstatement of significance levels. Cross-sectional dependence in stock returns data is likely to exist when at least some of the returns are sampled from common time periods. This would be the case in all studies of the reaction of stock prices to a

Inventory accounting method, LIFO, Event dates, Announcement returns

We hypothesize that past strike experience will have a negative or "teetotaler" effect on a collective bargaining unit's propensity to strike in future negotiations, other things being equal. We test this using a unique micro-level sample comprising four consecutive negotiations by 147 bargaining units in U.S. manufacturing industries, controlling for observable and unobservable differences among bargaining pairs in the propensity to strike. Our results are consistent with the view that the experience of striking is, indeed, sobering: lagged strike experience variables have a significantly negative effect on the propensity to strike in the current negotiation.

Abstract. A Bayesian model for nonsampling errors made by the auditor is investigated to determine the effects of such errors on audit inferences. Predictive distributions are used to illustrate that for “realistic” audit situations, Type II errors will have little effect on inferences for a given level of Type I error. Type I errors are shown to play a more critical role in determining the acceptability of an internal control. Résumé. Un modèle Bayesien relatif aux erreurs, de nature autre qu'échantillonnale, commises par le vérificateur est étudié afin de déterminer les effets de telles erreurs sur les inférences en vérification. Des distributions de prédiction sont employées pour illustrer le fait qu'en situation de vérification «réaliste», les erreurs de deuxième espèce auront peu d'effet sur les inférences pour un niveau donné d'erreur de première espèce. Il est montré que les erreurs de première espèce jouent un rôle plus critique en ce qui a trait à la détermination du caractère acceptable d'un procédé de contrôle interne.

Don L. Coursey, John L. Hovis, William D. Schulze; The Disparity Between Willingness to Accept and Willingness to Pay Measures of Value*, The Quarterly Jou

There has been considerable controversy about the role of financial factors as determinants of savings in developing countries. This paper explores the importance of two such factors, namely, real interest rate and financial intermediation. Using pooled time- series, cross-section data, a model of savings is estimated for Asia, Latin America, and for the total sample. Particular attention is paid to the error structure in estimation. The results suggest that pooling is not justified. Further, there is no unequivocal support for the effect of either of the two factors; some qualified support is found for Asia but none for Latin America. Copyright 1987 by MIT Press.

Socialist enterprises in Yugoslav agriculture show higher levels of productivity than private producers. The author examines the sources of these differences with total factor productivity estimates based on sectoral aggregate Cobb-Douglas production functions which permit separation of environmental, policy, and organizational effects. The results support the following conclusions: cooperative socialist enterprises are not inherently inefficient and can even outperform private producers; both types of producers were responding to their environment and their differential rates of technological change reflect the different constraints they faced; and socialist enterprises exhibited technology adoption behavior similar to nonsocialist enterprises elsewhere. Copyright 1987 by MIT Press.