We report illusions we observed while investigating thresholds for detecting a deviation in one out of several trajectories of dots moving in straight lines (Tripathy and Barrett 2003). The deviating trajectory consisted of two straight-line segments, with the deviation occurring in the middle of the trajectory, at the intersection of the two segments. Robust distortions were noticed in the sha...

Recent research works have shown control statistics based on squared deviation of observations from target have the ability to monitor variability in both univariate and multivariate processes. In the current research, the properties of the control statistic t S that has been proposed by Huwang et al. (Journal of Quality Technology 2007; 39: 258-278) are first reviewed and three new t S -based ...

We report on a large number of laboratory market experiments demonstrating that a market bubble can be reduced under the following conditions: 1) a low initial liquidity level, i.e., less total cash than value of total shares, 2) deferred dividends, and 3) a bid–ask book that is open to traders. Conversely, a large bubble arises when the opposite conditions exist. The first part of the article ...

In our target-initiated theory of takeovers, a target approaches potential acquirers that privately know their standalone values and merger synergies, where higher synergy tend to have larger values. Despite information disadvantage, targets can extract all surplus when synergies are concavely related by offering payment choices combinations cash equity. Targets exploit the reluctance high-valu...

1. Interoperability of retail payment instruments is not an objective in its own right; rather it is a means of achieving other desirable objectives. Interoperability can promote a range of intermediate objectives such as greater productive efficiency, convenience for customers and dynamic efficiency through promoting competition within the financial sector. However, the attainment of intermedi...

We extend the Barth, Cram, and Nelson (2001) model with disaggregated accruals by investigating whether cash flow components (core and non-core cash flows) improve cash flow predictability. BCN investigate the role of accrual components in predicting future cash flows while this study extends their study by investigating the role of cash flow components. We propose a cash flow prediction model ...

Asset market experiments are analyzed by distinguishing, ex post facto, participants who trade on fundamentals versus those who trade on momentum (i.e., buying when price is rising). The distinction is made when prices are above fundamental value, so that (in each period) those who have more offers than bids (net offerers) are classified as fundamentalists while those who have more bids than of...

Cash takeover bids financed from internally generated cash reserves could be a function of capital market imperfections (Myers and Majluf 1984) or symptomatic of “free-cash-flow” problems (Jensen 1986, 1988). We find that bids financed from cash reserves outperform those that use debt financing. Further, ‘free cash flow’ firms outperform ‘non-free cash flow’ firms. The majority of cash bids are...