Information theory and risk in capital markets

The present empirical study applies the methodology of information theory to the problem of assessing and separating capital market risk, which is separated into its systematic and unsystematic components. Monthly return relatives for all securities traded on the New York Stock Exchange are examined for the period 1926 to 1971, which is segmented into six 7-year subperiods. The securities are combined into portfolios of various sizes and ranked. It is concluded that although both systematic and unsystematic risks have increased over the 45-year interval—particularly between the pre-1940 and post-1940 periods—they have maintained their relative share of the total risk over the same period.     

Understanding changes in Māori incomes and income inequality 1997–2003

This paper examines recent changes in weekly income levels and dispersion for Māori, New Zealand’s indigenous ethnic group. Changes in the Māori income distribution between 1997 and 2003 reflect rapid increases in economic growth and employment rate. A reduced proportion of people had zero or benefit-level incomes and a higher proportion had high incomes. Income inequality declined for working-aged Māori and was stable for employed Māori. The average income gap between Māori and Europeans declined. The increased Māori employment rate during this period was the single most important driver of changes in the Māori income distribution.

New Environmental Theories: Toward a Coherent Theory of Environmentally Significant Behavior

This article develops a conceptual framework for advancing theories of environmentally significant individual behavior and reports on the attempts of the author's research group and others to develop such a theory. It discusses definitions of environmentally significant behavior; classifies the behaviors and their causes; assesses theories of environmentalism, focusingespecially on value-belief-norm theory; evaluates the relationship between environmental concern and behavior; and summarizes evidence on the factors that determine environmentally significant behaviors and that can effectively alter them. The article concludes by presenting some major propositions supported by available research and some principles for guiding future research and informing the design of behavioral programs for environmental protection.     

Estimating chance reproducibility in Guttman Scaling

A definition of reproducibility in Guttman Scaling and two chance measures of reproducibility are suggested. The first measure assumes that the items are independent. The second method assumes nonindependent items and fits respondent and item margins by an iterative method used in fitting log-linear models. Chance reproducibility is conceptualized in terms of assumptions about respondent variability.     

Effects of Group Practice of the Transcendental Meditation Program on Preventing Violent Crime in Washington,D.C.: Results of the National Demonstration Project,June--July 1993

This paper reports the results of a prospective experiment in which a group of approximately 4,000 participants in the Transcendental Meditation and TM-Sidhi programs of Maharishi Mahesh Yogi assembled in Washington, D.C., from June 7 to July 30, 1993. It was hypothesized that levels of violent crime in the District of Columbia would fall substantially during the Demonstration Project, as a result of the group's effect of increasing coherence and reducing stress in the collective consciousness of the District. A 27-member Project Review Board comprising independent scientists and leading citizens approved the research protocol and monitored the research process. Weekly crime data was derived from database records provided by the District of Columbia Metropolitan Police Department (DCMPD), which are used in the FBI Uniform Crime Reports. Statistical analysis considered the effect of weather variables, daylight, historical crime trends and annual patterns in the District of Columbia, as well as trends in neighboring cities. Consistent with previous research, levels of homicides, rapes and assaults (HRA crimes) correlated with average weekly temperature. Robberies approximately followed an annually recurring cycle. Time series analysis of 1993 data, controlling for temperature, showed that HRA crimes dropped significantly during the Demonstration Project, corresponding with increases in the size of the group; the maximum decrease was 23.3% (p < 2 × 10–9) [24.6% using a longer baseline, with 1988--1993 data (p < 3 × 10–5)], coincident with the peak number of participants in the group during the final week of the assembly. When the same period in each of the five previous years was examined, no significant decreases in HRA crimes were found. Robberies did not decrease significantly. However, a model that jointly estimated the effect of the Demonstration Project on both HRA crimes and robberies showed a significant reduction in violent crimes overall of 15.6% (p = 0.0008). Further analysis showed that the effect of the coherence-creating group on reducing HRA crimes could not be accounted for by additional police staffing. The time series analysis for HRA crimes gave results that are highly robust to alternative model specifications, and showed that the effect of the group size was cumulative and persisted after the Demonstration Project ended. Also, calculation of the steady state gain based on the time series model predicted that a permanent group of 4,000 coherence-creating experts in the District would have a long-term effect of reducing HRA crimes by 48%.