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Rational Behavior (rational + behavior)

Distribution by Scientific Domains

Humanities and Social Sciences	50%
Business, Economics, Finance and Accounting	50%

Selected Abstracts

Punctuated Equilibrium, Bureaucratization, and Budgetary Changes in Schools

POLICY STUDIES JOURNAL, Issue 1 2004
Scott E. Robinson
For half of a century, models of nonrational behavior have grown in popularity for explaining the behavior of administrative organizations. However, models of nonrational behavior are notoriously difficult to test because nonrational behavior is often difficult to separate from fully rational behavior. Recent research has suggested that particular types of nonrational processes should produce "punctuated" equilibria rather than "instantaneous" equilibria. In these nonrational processes, a decision maker underresponds to changes for a long period of time. Once pressure for change becomes overwhelming, the decision maker adopts a radical change. This is called "punctuation." The key to identifying this type of nonrationality of a process's rationality is the comparative success of fitting the observed behavior to "punctuated" rather than "instantaneous" equilibria. True, Jones, and Baumgartner (1999) developed a method for comparing the distribution of decision outputs as a strategy for assessing the relative degree of "punctuation" in the decision processes. By assessing the kurtosis (or "peakedness") of the distribution of decision outputs, one can get a sense of the excess (compared with a standard, normal distribution) of low and high rates of change,a sign of punctuated equilibrium. This article extends these recent developments by adapting the method to a comparative kurtosis framework. The results suggest that bureaucracy in K,12 schools serves to reduce (rather than amplify) the punctuations in budgeting processes. The article concludes with a discussion of the potential extension of the empirical results and modifications to the testing procedure. [source]

Punctuated Equilibrium in Comparative Perspective

AMERICAN JOURNAL OF POLITICAL SCIENCE, Issue 3 2009
Frank R. Baumgartner
We explore the impact of institutional design on the distribution of changes in outputs of governmental processes in the United States, Belgium, and Denmark. Using comprehensive indicators of governmental actions over several decades, we show that in each country the level of institutional friction increases as we look at processes further along the policy cycle. Assessing multiple policymaking institutions in each country allows us to control for the nature of the policy inputs, as all the institutions we consider cover the full range of social and political issues in the country. We find that all distributions exhibit high kurtosis values, significantly higher than the Normal distribution which would be expected if changes in government attention and activities were proportionate to changes in social inputs. Further, in each country, those institutions that impose higher decision-making costs show progressively higher kurtosis values. The results suggest general patterns that we hypothesize to be related to boundedly rational behavior in a complex social environment. [source]

Does deliverability enhance the value of U.S. Treasury bonds?

THE JOURNAL OF FUTURES MARKETS, Issue 3 2008
David R. KuipersArticle first published online: 8 JAN 200
This study presents the first examination of the value associated with long-term U.S. Treasury bonds related to their delivery eligibility in the Treasury bond futures market. The opportunity for study has recently become possible given the reduced maturity of Treasury's noncallable bonds in the market. Consistent with rational behavior, deliverable bonds are found to be more valuable than otherwise comparable, ineligible bonds, and the estimated premia are larger than those previously documented for deliverable bills. However, although detectable and statistically significant, the deliverability component of a cash bond's value is somewhat modest in economic terms; some policy implications of this result are discussed. © 2008 Wiley Periodicals, Inc. Jrl Fut Mark 28:264,274, 2008 [source]

China's Current Real Estate Cycle and Potential Financial Risks

CHINA AND WORLD ECONOMY, Issue 4 2006
Xiaojing Zhang
L1; E61; E51 Abstract The real estate cycle and financial stability are closely correlated. In light of global real estate bubbles, China's real estate cycle has attracted wide attention since 1998. The present paper analyzes three driving factors in the context of the current real estate cycle; namely, economic growth, macroeconomic environment and institutional establishment. Supported by econometric analysis using quarterly data from 1992,2004, the present paper indicates that real estate will develop steadily and that housing prices will consistently rise in the relative long run. Based on quantitative analysis, it is concluded that the implications of the current real estate cycle for financial stability include risks of real estate credit exposure, government guarantees and maturity mismatch. Some corresponding policy implications are discussed, such as advancing banking reform, encouraging the rational behavior of local governments and strengthening the regulation of foreign capital flows in and out of China's real estate industry. (Edited by Xinyu Fan) [source]