Prediction - Publications - Faculty & Research

December 1998
Background Note

Cash Management Practices in Small Companies

By: H. Kent Bowen, Andrew R. Jassy, Laurence E. Katz, Kevin E. Kelly and Baltej Kochar

Most small business managers claim that cash management is their leading concern. Often walking a tightrope between growth and illiquidity, small business managers face different cash management challenges than their counterparts in larger companies. Compared to larger... View Details

Keywords: Motivation and Incentives; Working Capital; Management Practices and Processes; Organizational Design; Cash; Forecasting and Prediction; Policy; Business Strategy

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January 2008
Background Note

Equity Options

By: Joshua Coval and Erik Stafford

The goal of this simulation is to understand the reliance of option values on volatility. When an investor trades an option, they are essentially trading volatility. Therefore, much of the focus in this lesson is on forecasting volatility. Students are able to use two... View Details

Keywords: Volatility; Forecasting and Prediction; Stock Options; Investment Return; Price; Market Transactions; Mathematical Methods; Value

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December 2008
Article

Style Investing and Institutional Investors

By: Kenneth A. Froot and Melvyn Teo

This paper explores institutional investors' trades in stocks grouped by style and the relationship of these trades with equity market returns. It aggregates transactions drawn from a large universe of approximately $6 trillion of institutional funds. To analyze style... View Details

Keywords: Forecasting and Prediction; Behavioral Finance; Stocks; Investment Return; Market Transactions; Performance Expectations; Personal Characteristics; Financial Services Industry

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June 2005
Article

Currency Returns, Intrinsic Value, and Institutional Investor Flows

By: K. A. Froot and T. Ramadorai

Keywords: Currencies; Exchange Rates; Purchasing Power Parity; Real Exchange Rate; Forecasting and Prediction; Behavioral Finance; Investment Return; Market Transactions; Performance Expectations; Personal Characteristics; Asset Pricing; Financial Services Industry

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September 2004
Article

Decomposing the Persistence of International Equity Flows

By: Kenneth A. Froot and J. Tjornhom Donohue

Keywords: Asset Pricing; Equity Investment; Forecasting and Prediction; Behavioral Finance; Stocks; Investment Return; Market Transactions; Performance Expectations; Personal Characteristics; Financial Services Industry

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15 Mar 2011
First Look

First Look: March 15

effect on the investment of firms. High taxes will favor investment by firms that can finance internally. Using an international panel with many changes in payout taxes, we show that this prediction holds well. Payout taxes have a large... View Details

Keywords: Sean Silverthorne

13 Oct 2010
First Look

First Look: October 13, 2010

fixed-pie perceptions by suggesting that disputants may prefer proposals that are perceived to be equally attractive to both parties (i.e., balanced) rather than one-sided, because balanced agreements are seen as more likely to be successfully implemented. We test our... View Details

Keywords: Sean Silverthorne

14 Sep 2010
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First Look: September 14, 2010

extensive theoretical literature generates ambiguous predictions concerning the effects of intellectual property rights (IPR) reform on industrial development. The impact depends on whether multinational enterprises (MNEs) expand... View Details

Keywords: Sean Silverthorne

06 Apr 2010
First Look

First Look: April 6

liberalization and since broad-based corporate governance reforms were implemented, goes expressly against the prediction of prior schools of thought about business groups. We argue that the conventional wisdom about tunneling and... View Details

Keywords: Martha Lagace

06 Apr 2016
Research & Ideas

Should Entrepreneurs Pitch Products or Ideas for Products?

approach to the “pitch or spec” dilemma by constructing a model that links this choice to writers’ past experience and their confidence level about this particular idea. The model also predicts the average quality of ideas offered for... View Details

Keywords: by Carmen Nobel; Motion Pictures & Video; Entertainment & Recreation; Banking

January 2025
Supplement

Hippo: Weathering the Storm of the Home Insurance Crisis (B)

By: Lauren Cohen, Grace Headinger and Sophia Pan

Rick McCathron, CEO of Hippo, was optimistic about the InsurTech's path to profitability after navigating the financial uncertainties of 2022. By bundling their home insurance services with third-parties and established insurance incumbents, Hippo was adopting a... View Details

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25 Sep 2018
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New Research and Ideas, September 25, 2018

between tax brackets within a state-year cell and which absorb heterogeneity and contemporaneous changes in economic conditions; ii) an instrumental variable approach, which predicts changes in an individual or firm's total tax rate with... View Details

Keywords: Dina Gerdeman

07 Aug 2018
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New Research and Ideas, August 8, 2018

based on a large panel dataset of countries between 1950 and 2014. We instrument actual trade with predicted trade constructed by estimating a time-varying gravity equation similar to Feyrer (2009). We find that economic integration has a... View Details

Keywords: by Sean Silverthorne

13 Jun 2017
First Look

First Look at New Research and Ideas, June 13

sensitivity to ambiguity also predicted a greater frequency of arrests. Together, these data suggest that alterations in cost-benefit decision-making under conditions of ambiguity may promote antisocial behavior. Publisher's link:... View Details

Keywords: Sean Silverthorne

17 Sep 2001
Research & Ideas

Is There Help for the Big Ticket Buyer?

consumer's expected welfare. One way to think of this is to ask whether a better-informed consumer would move in the directions suggested by prescriptive models. Generally, I predict that as a consumer received more information, they... View Details

Keywords: by Max H. Bazerman

January – March 2012
Article

Bond Risk, Bond Return Volatility, and the Term Structure of Interest Rates

By: Luis M. Viceira

This paper explores time variation in bond risk, as measured by the covariation of bond returns with stock returns and with consumption growth, and in the volatility of bond returns. A robust stylized fact in empirical finance is that the spread between the yield on... View Details

Keywords: Bonds; Volatility; Forecasting and Prediction; Interest Rates; Inflation and Deflation; Investment Return; Risk and Uncertainty; Currency Exchange Rate; Cash Flow; Stocks

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13 Jan 2009
First Look

First Look: January 13, 2009

customers over a period of four months. We predict and find that should DVDs (e.g., documentaries) are held significantly longer than want DVDs (e.g., action films) within-customer. Similarly, we also View Details

Keywords: Martha Lagace

20 Jul 2016
Research & Ideas

Airplane Design Brings Out the Class Warfare in Us All

football stadium, a cruise ship—where people are segmented by rank of some sort. Norton co-authored the study, Physical and Situational Inequality on Airplanes Predicts Air Rage, with Katherine A. DeCelles, an associate professor of... View Details

Keywords: by Dina Gerdeman; Air Transportation; Sports; Travel

1992
Chapter

Exchange Rate Forecasting Techniques, Survey Data, and Implications for the Foreign Exchange Market

By: J. Frankel and K. A. Froot

Keywords: Currencies; Exchange Rates; International Macroeconomics; Monetary Policy; Currency Controls; Fixed Exchange Rates; Floating Exchange Rates; Currency Bands; Currency Zones; Currency Areas; Rational Expectations; International Finance; Currency Exchange Rate; Asset Pricing; Forecasting and Prediction; Policy

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November 2018
Case

Komatsu Komtrax: Asset Tracking Meets Demand Forecasting

By: Willy Shih, Paul Hong and YoungWon Park

Komatsu's Komtrax system started as a way of remotely monitoring and tracking equipment for the purpose of improving operational efficiency. This case follows its evolution towards other uses including demand forecasting for its sales, marketing, and production... View Details