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The resource-based view posits that firms achieve competitive advantage from value creation through firm-specific investments held by key stakeholders: employees, suppliers, and customers. Shareholder-dominant (agency) theory holds that all aresidual income claimant rights belong to shareholders, circumscribing other key stakeholders' ability to appropriate value from their investment. However, recent enhancements to stakeholder theory grounded in property rights suggest that such stakeholders may need protection for implicit residual claims. A central purpose of this article is to build a model of the protection devices used to ensure these implicit rights. Individual ex ante devices such as stakeholder ownership only partially incentivize stakeholders' firm-specific investments because they are subject to two types of uncertainties-behavioral and environmental- and individual devices aimed at reducing one type of uncertainty may exacerbate the other. We therefore expand on efforts to establish a stakeholder theory of strategic management by proposing an integrated model of protection devices,which seeks to overcome the incentive dilemma in reducing both uncertainties by reducing barriers to stakeholder firm-specific investment. Our model also explores the conflicts and complementarities associated with device implementation. Finally, we discuss theoretical and practical implications, as well as future research opportunities associated with our model. [ABSTRACT FROM AUTHOR]

During the 3D printing of graphene platelet inclusion in resin, residual stresses due to thermal loading can cause wrinkle/distortion of final part. This paper presents a multi-scale modeling approach to reduce the residual thermal stress at the interphase between inclusion and resin. Material characterization is performed utilizing an integrated multi-scale modeling approach: (a) nano modeling examines effect of defects such as void shape/size/distribution, platelet orientation, etc.); (b) micro-mechanics examines constituents (platelet/matrix/interphase, residual stress); (c) macro-mechanics examines the delamination and debonding. De-homogenized multi-scale modeling approach provides detailed stiffness/strength to Finite Element Model (FEM) for full structural/thermal progressive failure analysis to address wrinkling/distortion, damage and delamination evolution via cohesive traction separation. [ABSTRACT FROM AUTHOR]

We track the dividend initiation (DI) decisions from a sample of 6,588 firms that went public during the period 1979–2005 and find that 873 of them initiated dividends. Our primary objective is to determine whether information signaling can explain the DI decision. We find that variables suggested by the dividend-signaling models of John and Williams (1985) and Allen, Bernardo, and Welch (2000) are significant determinants of the DI decision and the associated announcement-period stock price effect. We also find support for the residual, agency, tax, clientele, transaction costs, catering, and life-cycle explanations of dividend policy. [ABSTRACT FROM PUBLISHER]

In corporate finance and asset pricing empirical work. researchers are often confronted with panel data. In these data sets, the residuals may be correlated across firms or across time. and OLS standard errors can be biased. Historically, researchers in the two literatures have used different solutions to this problem. This paper examines the different methods used in the literature and explains when the different methods yield the same (and correct) standard errors and when they diverge. The intent is to provide intuition as to why the different approaches sometimes give different answers and give researchers guidance for their use. [ABSTRACT FROM AUTHOR]

This study investigated whether the disclosure in accounting reports of information on risk and its management affects, at the margin, firm valuations in the Brazilian capital market. It questioned the existence of value relevance in the disclosure of information related to risk factors and risk management structures. The importance of the topic arises from the documentation that disclosure on risk factors plays a statistically significant role in valuing firms in a context marked by economic and political uncertainty, as is the case of the Brazilian market. The findings confirmed that information about risk shows informational relevance for firm valuations. Information on risk management in a firm, in turn, was not shown to be significant in terms of affecting company share valuations. The investigation of detailed reports with different risk factors indicated that individualized information shows different degrees of relevance for company valuations. It is inferred that the disclosure of risk factors affects the perception of investors, who also base their estimates of return on the availability and detail of such information. It is also observed that information on risk management structure was not shown to be value relevant; moreover, few firms published information on the establishment of this type of entity in their management structures. The residual income valuation (RIV) model (Ohlson, 1995) was applied using regressions with panel data estimation related to the three years covering 2012 to 2014. The sample, which was randomly delimited, was formed of 100 companies. The data on disclosure of risk and disclosure of risk management were collected from the companies' Reference Forms, available from the website of the São Paulo Stock, Commodities, and Futures Exchange (BM&FBOVESPA). As an impact on the area of knowledge, broader discussions are expected regarding the utility of disclosure on the topic related to risk factors and the existence of a specific body responsible for risk management in firms, according to investors' perceptions. It also contributes by providing evidence about the quality of disclosure related to risk (factors and management) and the perception of the capital market regarding the informativeness and relevance of such elements. [ABSTRACT FROM AUTHOR]

Automated defect inspection has long been a challenging task especially in industrial applications, where collecting and labeling large amounts of defective samples are usually harsh and impracticable. In this paper, we propose an approach to detect and localize defects with only defect-free samples for model training. This approach is carried out by reconstructing image patches with convolutional denoising autoencoder networks at different Gaussian pyramid levels, and synthesizing detection results from these different resolution channels. Reconstruction residuals of the training patches are used as the indicator for direct pixelwise defect prediction, and the reconstruction residual map generated in each channel is combined to generate the final inspection result. This novel method has two prominent characteristics, which benefit the implementation of automatic defect inspection in practice. First, it is absolutely unsupervised that no human intervention is needed throughout the inspection process. Second, multimodal strategy is utilized in this method to synthesize results from multiple pyramid levels. This strategy is capable of improving the robustness and accuracy of the method. To evaluate this approach, experiments on convergence, noise immunity, and defect inspection accuracy are conducted. Furthermore, comparative tests with some excellent algorithms on actual and simulated data sets are performed. Experimental results demonstrated the effectiveness and superiority of the proposed method on homogeneous and nonregular textured surfaces. [ABSTRACT FROM AUTHOR]

The paper tests the assumptions underlying the inference‐in‐residuals method as an estimation framework for detecting and classifying suspects of earnings management. We derive several systematic biases that are shown to confound inference‐in‐residuals and, depending on the data, could render the method a futile exercise. This is not a matter of model specification, but a limitation of the statistical method. Also, it is shown that the method of using estimated residuals in a second stage regression on economic determinants of earnings management suffers considerably, especially when residuals are estimated by industry classification in the first stage. [ABSTRACT FROM AUTHOR]

Licensing promotes technology transfer and innovation, but enforcement of licensing contracts is often imperfect. We model contract enforcement as a game with perfect information but probabilistic enforcement and explore the implications of weak enforcement on the design of licensing contracts, the conduct of firms, and market performance. An upstream firm develops a technology that it can license to downstream firms using a fixed fee and a per-unit royalty. Strictly positive per-unit royalties maximize the licensor's profit if competition among licensees limits joint profits. With imperfect enforcement, the licensor lowers variable royalties to avoid cheating. Although imperfect contract enforcement reduces the profits of the licensor, weak enforcement lowers prices, increases downstream innovation, and in some circumstances can increase total economic welfare. [ABSTRACT FROM AUTHOR]

In this paper, an adaptive trust region algorithm in which the trust region radius converges to zero is presented for solving large-residual nonsmooth least squares problems. This algorithm uses the smoothing technique of the approximation function, and it combines an adaptive trust region radius. Moreover, this algorithm differs from the existing methods for solving nonsmooth equations through use of the approximation function of second-order information, which improves the convergence rate for large-residual nonsmooth least squares problems. Under some suitable conditions, the global and local superlinear convergences of the proposed method are proven. The preliminary numerical results indicate that the proposed algorithm is effective and suitable for solving large-residual nonsmooth least squares problems. [ABSTRACT FROM AUTHOR]

To examine the appropriateness of a Multi-Trait-Multi-Method framework for testing construct validity of Assessment Centers (ACs) and get practical implications for the improved AC design, degree to which the AC dimension-related performance behaviors consistently manifest across multiple AC rating situations was investigated. The present study used a large sample ( N = 5,006) to apply a measurement invariance analysis. AC rating situations generally produced consistent factor loadings for items on AC dimensions, item residuals, dimension factor variances, and covariance between dimensions. The AC rating situation of interview tended to produce higher ratings and less item residuals. These findings support the consistency in constructs assessed across different AC rating situations, while some exercises may be better for teasing apart particular dimensions than others. [ABSTRACT FROM AUTHOR]

Determination of parameters characterizing flows in porous media is a complex inverse problem. It is especially difficult to determine confidence intervals of such parameters. In this note, we develop a method based on utilization of bootstrapping in order to find confidence intervals of model parameters, which are determined by minimizing the discrepancy between model predictions and published experimental results. The discrepancy is characterized by the objective function defined as the sum of squared residuals in the points where experimental measurements are taken. A residual is defined as the difference between the experimentally measured value and the model prediction of this value. We utilized bootstrapping to generate surrogate experimental data by randomly resampling residuals and then adding them back to model predictions. The model parameters that give the best fit with a large number of surrogate data were then determined. By analyzing the histograms of best-fit parameter values, we were able to find confidence intervals for these parameters. We utilized the developed method to determine confidence intervals for the effective viscosity and Forchheimer coefficient. [ABSTRACT FROM AUTHOR]

This paper studies U.S. house prices across 45 metropolitan areas from 1980 to 2012. It applies a version of the Gordon dividend discount model for long-run 'fundamentals' and uses Mean Group and Pooled Mean Group estimation to estimate long-run and short-run determinants of house prices. We find great similarity across cities in that the long-run house prices are largely explained by the same fundamentals; the long-run rent to price ratio is approximately 5% plus 0.75 times the real interest rate (which is on the order of 2%). However, adjustments to deviations from the fundamentals are slow, in the long-run, closing the gap at a rate of around 10% per year. We find sharp differences in short-run adjustments (momentum) away from the fundamentals across cities, and the differences are correlated with local supply elasticities (more momentum with lower elasticity). Analysis of residuals suggests strong cyclical deviations, which are mean-reverting. [ABSTRACT FROM AUTHOR]

It is widely accepted that the fossil record suffers from various sampling biases - diversity signals through time may partly or largely reflect the rock record - and many methods have been devised to deal with this problem. One widely used method, the 'residual diversity' method, uses residuals from a modelled relationship between palaeodiversity and sampling (sampling-driven diversity model) as 'corrected' diversity estimates, but the unorthodox way in which these residuals are generated presents serious statistical problems; the response and predictor variables are decoupled through independent sorting, rendering the new bivariate relationship meaningless., Here, we use simple simulations to demonstrate the detrimental consequences of independent sorting, through assessing error rates and biases in regression model coefficients., Regression models based on independently sorted data result in unacceptably high rates of incorrect and systematically, directionally biased estimates, when the true parameter values are known. The large number of recent papers that used the method are likely to have produced misleading results and their implications should be reassessed., We note that the 'residuals' approach based on the sampling-driven diversity model cannot be used to 'correct' for sampling bias, and instead advocate the use of phylogenetic multiple regression models that can include various confounding factors, including sampling bias, while simultaneously accounting for statistical non-independence owing to shared ancestry. Evolutionary dynamics such as speciation are inherently a phylogenetic process, and only an explicitly phylogenetic approach will correctly model this process. [ABSTRACT FROM AUTHOR]

Fixed income attribution is one of the fastest growing areas of focus for investment managers as they look to understand and explain the drivers of performance. There are several challenges in obtaining meaningful and accurate results, but residuals, often due to poor data quality, remain one of the biggest barriers. In this article, I will discuss the different approaches to fixed income attribution, and how residual management practices can streamline the process of calculating fixed income attribution and increase the accuracy of its results. [ABSTRACT FROM AUTHOR]

To study the presence of a risk-taking channel in the U.S., we build a comprehensive data set from the syndicated corporate loan market and measure monetary policy using different measures, most notably Taylor (1993) and Romer and Romer (2004) residuals. We identify a negative relation between monetary policy rates and bank risk-taking, especially in the run up to the 2007 financial crisis. However, this effect is purely supply-side driven only when using Taylor residuals and an ex ante measure of bank risk-taking. Our results highlight the sensitivity of the potency of the risk-taking channel to the measures of monetary policy innovations. [ABSTRACT FROM AUTHOR]

The conventional SUR model has a strong assumption of normally distributed residuals which might not be realistic. What this paper suggests is to take an advantage from Copulas approach in order to relax this normality assumption. Therefore, we introduce the Copulabased SUR model as an alternative to the conventional SUR model. The performance and accuracy of the proposed model are evaluated through the simulation study. We then apply the Copula-based SUR model to the real data set of Thai rubber and compare the estimation result with the result obtained f rom the conventional SUR model. The results of this paper could support our suggestion that the Copulas can be used appropriately to relax the assumption of normality of residuals in the conventional SUR model. [ABSTRACT FROM AUTHOR]

We provide generalized least-squares (GLS) detrended versions of single-equation static regression or residuals-based tests for testing whether or not non-stationary time series are cointegrated. Our approach is to consider nearly optimal tests for unit roots and to apply them in the cointegration context. We derive the local asymptotic power functions of all tests considered for a triangular data-generating process, imposing a directional restriction such that the regressors are pure integrated processes. Our GLS versions of the tests do indeed provide substantial power improvements over their ordinary least-squares counterparts. Simulations show that the gains in power are important and stable across various configurations. [ABSTRACT FROM AUTHOR]

In the current study, a new method by the weighting absolute centered external variable (WCEV) was proposed to stabilize heteroscedasticity for butterfly-distributed residuals (BDRs). After giving brief information about heteroscedasticity and BDRs, WCEV was introduced. The WCEV and commonly used variance stabilizing methods are compared on a simple and a multiple regression model. The WCEV was also tested for other type of heteroscedasticity patterns. In addition to heteroscedasticity, other regression assumptions were checked for the WCEV. [ABSTRACT FROM AUTHOR]

The article offers information about several fundamental concepts concerning portfolio performance contribution. It discusses an issue about residuals which occurs when trading takes place, as well as the use of a method linking contribution effects across time. Information about relative and absolute attribution is presented.

Test statistics using cumulative sums of residuals have been widely used in various regression models including generalized linear models(GLM). Recently, Pan and Lin (2005) extended this testing procedure to the generalized linear mixed models(GLMM) having random effects, in which we encounter difficulties in computing the marginal likelihood that is expressed as an integral of random effects distribution. The Gaussian quadrature algorithm is commonly used to approximate the marginal likelihood. Many commercial statistical packages provide an option to apply this type of goodness-of-fit test in GLMs but available programs are very rare for GLMMs. We suggest a computational algorithm to implement the testing procedure in GLMMs by a freely accessible R package, and also illustrate through practical examples. [ABSTRACT FROM AUTHOR]

This study uses a sample of dividend paying firms from the most recent 12-year period to test a simple residual income model and attempts to determine the key features of dividend payout. The results show moderate support for the model. A comparison of the period before and after the 2008 financial crisis indicates factor stability with minimal impact. [ABSTRACT FROM AUTHOR]

ABSTRACT Bootstrapping methods have so far been rarely used to evaluate spatial datasets. Based on an extensive Monte Carlo study we find that also for spatial, cross-sectional data, the wild bootstrap test proposed by Davidson and Flachaire () based on restricted residuals clearly outperforms asymptotic as well as competing bootstrap tests, like the pairs bootstrap. [ABSTRACT FROM AUTHOR]

Chapter 3 of the book "Foundations & Trends in Accounting" is presented. Topics discussed include equity valuation known as the residual income model (RIM); key elements of fundamental value including profitability and growth, cheapness, and earnings quality; and the use of Joel Greenblatt's Magic Formula.

Highlights: [•] Spatially modeled livestock stocking rates in over 900 sub-counties of Uganda. [•] Mapped model residuals to identify areas with higher or lower than optimal stocking levels. [•] Different approaches to livestock sector development suggested for the two types of high-residual areas. [ABSTRACT FROM AUTHOR]

The article focuses on the U.S. Court of Appeals for the Fourth Circuit case United States v. Mobley, which interprets the framework of universal residual clause in the U.S. It discusses significance of the Armed Career Criminal Act (ACCA) of 1986 and the Career Offender provision under the Sentencing Guidelines issued by the U.S. Sentencing Commission. It offers alternative solutions to provide a framework for interpreting future residual clause offenses pertaining to the case.

Abstract: Envy is often the cause of mutually harmful outcomes. We experimentally study the impact of envy in a bargaining setting in which there is no conflict in material interests: a proposer, holding the role of residual claimant, chooses the size of the pie to be shared with a responder, whose share is exogenously fixed. Responders can accept or reject the proposal, with game types differing in the consequences of rejection: all four combinations of (not) self-harming and (not) other-harming are considered. We find that envy leads responders to reject high proposer claims, especially when rejection harms the proposer. Notwithstanding, maximal claims by proposers are predominant for all game types. This generates conflict and results in a considerable loss of efficiency. [Copyright &y& Elsevier]

The article focuses on the decisions of the U.S. Court of International Trade given under 28 U.S.C. § 1581 (I) of the U.S. Trade Act of 1974 to testify the limits of residual jurisdiction. It analyzes the controversial aspects of the U.S. trade remedies law which deals with residual claims. It discusses the court case of Furniture Brands International, Inc. v. United States in which the eligibility for disbursements are analyzed under the Continued Dumping and Subsidy Offset Act (CDSOA).

We propose a new residual for regression models of ordinal outcomes, defined as E{sign(y,Y)}, where y is the observed outcome and Y is a random variable from the fitted distribution. This new residual is a single value per subject irrespective of the number of categories of the ordinal outcome, contains directional information between the observed value and the fitted distribution, and does not require the assignment of arbitrary numbers to categories. We study its properties, describe its connections with other residuals, ranks and ridits, and demonstrate its use in model diagnostics. [ABSTRACT FROM PUBLISHER]

This study revisits the relation between ARCH effects and trading volume. We extend the specification of the VA-GARCH (1, 1) model by using various volume variants and constructing contrast equity groups. We verify that the information flow assumed to be contained in the four trading volume variants has a starkly different explanatory power compared with the ARCH effects. Successive improvement of the model's empirical fit and the reduction of the fat-tailedness in the model residuals in the sequence of volume adjustment imply an increase in the strength of explaining the static aspects of volatility dynamics by the further adjusted volume variants. [ABSTRACT FROM PUBLISHER]

The article reports on how to regulate coal ash disposal. It mentions that coal ash is the unburned residuals parts from the combustion of coal. Further it mentions that coal is present in the environment, which has been made over millions of years from decayed plant matter. It also compares the disposal of coal ash with the disposal of other waste products.

In this study, the relationship between consumption and income is investigated from the Absolute Income Hypothesis perspective, by using the Engle and Granger methodology, with an extension to their sample group, including Austria, Belgium, Denmark, Finland, Germany, Italy and UK, as well as USA. The evidences suggest that both consumption and income series for all the countries have unit roots. The results also suggest that while the residuals from the long run relation estimation regression of consumption and income for Austria, Belgium, Finland and Germany have unit roots, the residuals for Denmark, Italy, UK and USA do not have unit roots, suggesting that for the later group of countries, consumption and income series are co-integrated. Lastly, the coefficients derived by estimating the error correction model for Italy, UK and USA are in accordance with the expected signs, suggesting that consumption adjusts in the short run to its long run equilibrium value. [ABSTRACT FROM AUTHOR]

Climate change impacts on soil organic carbon sequestration rate were simulated by agroecological model DAISY. Daily meteorological data for the Danubian Lowland up to 2100 were generated according to emission scenarios SRES A2 and B1 using general circulation model CGCM3.1. Effect of gradual increase of CO2 concentration in the atmosphere was taken into account. Various crop rotations as well as various management practices including irrigation and crop residuals incorporation were considered in three variants: i/ rainfed, residuals not incorporated, ii/ irrigated, residuals not incorporated, iii/ summer crops irrigated and residuals incorporated. Modelling outputs confirm that conventional rainfed agro-technical practices without incorporation of crop residues resulted to significant loss of soil organic carbon in soil profile towards more distanced time slices. The irrigation and the incorporation of crop residuals including stems and leaves can reduce soil organic carbon losses. If it is combined with proper crop rotation the soil organic carbon stock in soil profile can even increase [ABSTRACT FROM AUTHOR]

This paper uses RiskMetrics, GARCH and IGARCH models to calculate daily VaR for Belgrade Stock Exchange index BELEX 15 returns based on the normal and Student t innovation distribution. In the case of GARCH and IGARCH models VaR values are obtained applying Extreme Value Theory on the standardized residuals. The Kupiec's LR statistics was used to test the accuracy of risk measurement models. The main conclusions are: (I) when modelling value-at-risk it is very important to have a good model for volatility of stock returns; (2) both stationary and integrated GARCH models outperform RiskMetrics in estimating VaR; (3) although long memory volatility is present in the BELEXI5 index, TGARCH models cannot outperform GARCH type models in VaR evaluations for this index. [ABSTRACT FROM AUTHOR]

Testing for purchasing power parity (PPP) and uncovered interest parity (UIP) has been the focus of many empirically oriented studies. While these simple economic theories of exchange rate and interest rate determination are theoretically attractive, the empirical support for these equilibrium conditions is at best mixed. Many potential reasons have been cited in the literature for the failure of such studies, ranging from market imperfections to inappropriate modelling strategies. The current state-of-the-art procedure involves testing for two cointegrating vectors in a multivariate error correction model which may be economically identified as the PPP and UIP relations. However, such a procedure does not account for policy regime shifts which distort the underlying PPP and UIP relations. In this paper, a Markov-switching vector error correction model (VECM) is considered for time series data in which monetary and exchange rate regime shifts are known to be present. Weak evidence in favour of PPP and UIP is established in a standard linear VECM, although the residuals of this model indicate that it is inappropriate in terms of functional form. The Markov-switching VECM, however, provides convincing evidence in favour of both the PPP and UIP relations and a marked improvement in the residual distributions. [ABSTRACT FROM AUTHOR]

The movement of farm prices relative to other commodity prices is analysed for the period 1913:01 to 2003:12, investigating the number and time of structural breaks and discussing likely causes of structural breaks in the relative farm prices. Bai and Perron's (1998, 2003) multiple structural change test with a dynamic programming algorithm is used. This test makes it possible to have an efficient computation of the estimates of the break points as global minimizers of the sum of squared residuals. We find six structural breaks when we consider only the mean process and two breaks when we consider the mean and autoregressive processes. Possible causes for these breaks are discussed. [ABSTRACT FROM AUTHOR]

We demonstrate a methodology for estimating, with a specified probability, the interval within which the true DEA efficiency of an individual Decision Making Unit occurs. With this procedure, decisions based on DEA scores are made under conditions of risk, as opposed to the current practice in which decisions are made under uncertainty. The method applies statistical Panel Data Analysis (PDA), which provides proven and powerful methodologies for diagnostic testing of residuals and estimation of confidence intervals. Using PDA, we demonstrate, with a sample of real-world data, that DEA score residuals sometimes are independent and Normally distributed, and estimate confidence intervals based on these validated assumptions. Then, using another sample of real-world data in which violations of these assumptions do occur, we demonstrate well-known PDA Generalized Least Squares statistical models that account for the violations in the estimation of confidence intervals. [ABSTRACT FROM AUTHOR]

An exploratory survey of the mercury content of some common California biomass feedstocks shows that the concentrations are well below EPA toxicity levels with representative feedstock concentrations of 20 ppb for rice straw, 28 ppb for wheat straw, and 32 ppb for whole-tree wood chips. The temporal variability for rice straw (17–20 ppb) is near the analytical uncertainty (∼2 ppb). Saline-irrigated feedstock does not contain greatly higher mercury contents (17–38 ppb) compared to normally irrigated feedstock. Water leaching has likewise no detectable effects on mercury mobility, despite an up to 30% increase in the Hg concentrations attributable to mass losses during leaching. Combustion at temperatures of at least 575°C results in complete volatilization of mercury leaving solid ash and slag residuals with mercury contents at or near the lower limit of detection (5 ppb). The mercury strongly concentrated in fly ash can reach concentrations up to 40 times (<1,166 ppb) the corresponding fuel concentrations. [ABSTRACT FROM AUTHOR]

This paper gives a survey of different explorations carried out using speaker information present in the excitation source of speech for speaker recognition. The paper begins with an overview of the speaker recognition task. This is followed by a discussion on different speaker information present in speech, feature extraction methods, and types of excitation sources for speech production. Detailed descriptions on different explorations to exploit the speaker information in the excitation source are then given. These include methods based on pitch contour, jitter, shimmer, glottal flow derivative, linear prediction (LP) residual, LP residual phase, LP residual cepstrum, harmonic structure of the LP residual spectrum, and time frequency analysis of LP residual. A comparative study of all these methods is then carried out to highlight their merits and demerits. The paper is concluded by mentioning a future direction for speaker recognition from excitation source perspective. [ABSTRACT FROM AUTHOR]

This article investigates the time series properties of per capita real output for 19 Latin American Countries over the period 1965 to 2004. This empirical study examines the significance of contemporaneous correlations among cross sectional residuals using two newly developed tests. The tests find evidence of cross sectional dependence and induce us to use the SURADF and the CADF panel unit root tests, which allow for cross sectional dependence. The tests indicate that the real output in Latin American countries are characterized by a difference stationary process and output fluctuations seem to be permanent. These findings have important policy implications for these countries. [ABSTRACT FROM AUTHOR]

Method effects often occur when constructs are measured by different methods. In traditional multitrait-multimethod (MTMM) models method effects are regarded as residuals, which implies a mean method effect of zero and no correlation between trait and method effects. Furthermore, in some recent MTMM models, traits are modeled to be specific to a certain method. However, often we are not interested in a method-specific trait but in a trait that is common to all methods. Here we present the Method Effect model with common trait factors, which allows modeling “common” trait factors and method factors that represent method “effects” rather than residuals. The common trait factors are defined as the mean of the true-score variables of all variables measuring the same trait and the method factors are defined as differences between true-score variables and means of true-score variables. Because the model allows estimating mean method effects, correlations between method factors, and correlations between trait and method factors, new research questions may be investigated. The application of the model is demonstrated by 2 examples studying the effect of negative, as compared with positive, item wording for the measurement of mood states. [ABSTRACT FROM AUTHOR]

This article analyzes the nature of micro-entrepreneurship in Argentina and relates it to the empirical evidence available for other Latin American countries. It focuses on whether the sector resembles the neoclassical view, characterized by the risk-taking nature of the entrepreneurial activity, or if it is a precarious form of employment of last resort. The evidence confronts the neoclassical view of the micro-entrepreneur sector. It is argued that self-employment should be interpreted as functional to the capital accumulation process and not as a residual activity. [ABSTRACT FROM AUTHOR]

In this note, we examine the impact of non linear reward and risk measures on portfolio selection. In particular, we compare the ex-post final wealth sample paths of strategies based on the Sharpe ratio and strategies based on non-linear reward/risk measures. As suggested by the recent literature, we model dependencies with an asymmetric t copula estimated on the innovations of the marginals that follow an ARMA-GARCH type model. Therefore, we first simulate future scenarios, on the basis of which allocation decisions are made, and then we compare the ex-post final wealth obtained with non-linear risk and reward strategies and the wealth obtained with classic portfolio strategies. [ABSTRACT FROM AUTHOR]

In this paper, we propose a methodology to value the portfolio choices based on the prediction of future returns where the dependence structure of joint returns and the behavior of single returns are estimated separately. In particular, we assume the marginals evolve as an ARMA(0,2)-GARCH(0,2) model with stable paretian residuals and the joint distribution of residuals is estimated with an asymmetric t-copula. Then, we compare the ex-post final wealth sample paths of different strategies based on reward/risk ratios. Doing so we examine and discuss the impact of the forecasting method with respect to classic myopic portfolio strategies based on the same reward/risk ratios. [ABSTRACT FROM AUTHOR]