This manuscript studies the impact of the term structure of interest rates on corporate optimal capital structure. First, I develop a dynamic model of capital structure in the presence of stochastic cash flows and stochastic interest rates. Using one-factor and two-factor Cox, Ingersoll, and Ross (1985b) interest rates dynamic, as well as a one-factor Feller cash flow process, the article solves for the value of the firm's contingent claims. After deriving closed-form solutions for the values of debt, tax benefits, bankruptcy costs and recapitalization costs, the paper numerically solves for the optimal total capital structure: leverage, debt service, maturity, call provisions and priority. I find that as the instantaneous rate rises, so does the leverage, maturity and periodic debt service. I also find that an increase in the level of long-term rate leads to a decrease in leverage, maturity and periodic debt service. In an attempt to understand the effect of macroeconomic conditions on corporate financing decisions, this manuscript then empirically investigates the effect of the term structure of interest rates--defined by a three-factor model which includes the Treasury bill yield, the Treasury bond yield, and the volatility of the yield curve--on the debt-equity choice. Having controlled for well-known microeconomic determinants of financing decisions, I document that as the Treasury bill yield rises, the incidence of debt financing increases. However, as the Treasury bond yield or the volatility of the yield curve rise, the incidence of debt financing drops. I find that the information content of the term structure of interest rates regarding aggregate corporate profitability (i.e. aggregate default risk) accounts for the stylized facts. I also find that tax shield distortions induced by changes of interest rates marginally affect the debt-equity choice. Additionally, inflation, corporate credit spreads, mortgage rates, and personal tax rates materially are shown to affect the firm's financing decisions materially.

Employing methodologies and theoretical approaches from the fields of cultural studies, cultural anthropology, community studies, folkloristics, and critical political economics of communication, this study explores the production and consumption of commodities, performances and community within local southern Arizona popular music scenes in the context of the increasingly global media industries. This participant-observer ethnography engages my everyday life experiences as a musician, recording engineer and producer with contemporary academic debates about meaning, value and postmodernism. Scholars taking extreme positions in these debates often apply concepts from semiotics to the practices of production and consumption of cultural commodities in order to understand the sociological, economic and cultural transformations of late modernity. While these linguistic metaphors illuminate the potentially resistant play of signs within the articulations of these subcultural groups, the pragmatism of symbolic interactionism focuses much-needed attention on certain social aspects of rituals of consumption at the risk of obfuscating the power of the transnational media industries in organizing, promoting and mass-distributing such discourses. Indeed, large-scale political economic inquiry grounded in a realist epistemology shows that the work of audience consumption is organized not only to profit the media, marketing and advertising corporations, but also to reproduce capitalist social relations and ideology. My fieldwork suggests a synthesis of the elements of these debates. The new terminology and concepts defined and conceptualized in this dissertation as "self-production" and "self-sampling" within the "commodity community" allow analysis of the flexible organization of such performative consumption as productive of social relations, community, identity and meaning. Indeed, the feelings of meaningful community belonging are a large share of what one buys in such leisure scenes. Further, these social products are increasingly measured, sampled and packaged as cybernetic commodities for exchange both through traditional market channels and via the new "interactive" media technologies. I conclude by turning these abstract models and metaphors to a critique of the academic "commodity community" of postmodern cultural studies.

The widely used database technology and more recent developments in networking and Web technologies are encouraging diversity in the utilization of existing data. Data are now routinely pooled from multiple systems and physical locations, and integrated in creative ways for various decision-making purposes. From a managerial perspective, however, there are growing concerns in regard to the quality of the output information, and the economic justification of costly investments in such technologies. The major part of this dissertation addresses these concerns through formal studies on the quality and value of information, based on information economics (IE) theory. The quality and value of information integration is studied from a standpoint that recognizes the fundamental role of information integration in information systems. The objective of this study is to create a domain-independent theoretical framework that can facilitate decision making on information integration. The framework classifies information integration situations using two information quality characteristics--informativeness and dependence--and links different conditions in terms of these characteristics with different predictions on the value of integration. A second, related study centers on the questions of whether improving the accuracy of the input of an information system guarantees higher accuracy and economic value of its output, especially higher accuracy and economic value of forecasts. The study offers sufficient conditions under which the answer to these questions is positive, and also presents counter examples that suggest conditions under which the answer is negative. The results point to a contextual factor that can affect accuracy both ways--positive or negative--which has been ignored by data quality theory. This factor is dependence between errors. A third study considers a question related to software economics. Software economics theory equates software with code and directs that the supply of information be based entirely on demand patterns. However, an increasingly common custom in the software market to bundle the code with services indicates that a different model of cost and price may apply in many cases. Such model combines the information goods cost model with a service cost model. The study focuses on the question of the validity of such alternative model.

Rubinstein's alternating offer bargaining model is extended to uncertain situations. When the players do not have complete information on the feasible payoff set, the bargaining is based on the players' own estimations on the Pareto frontier. It has been proved that there always exists a unique stationary fictitious subgame perfect equilibrium (SPE) if the estimates of the Pareto frontier are close to each other. Monotonicity and convergence properties of the stationary subgame perfect equilibria (SPEs) are next examined. It has been shown that the convergence of the disagreement payoff vector and the break-down probabilities implies the convergence of the SPEs as well. The controllability of the resulting dynamic systems is examined and it is shown that by selecting an appropriate disagreement payoff vector and a break-down probability, any desired outcome or maximize payoffs can be reached. The bargaining processes with time-varying Pareto frontiers are also analyzed. Four examples are provided to illustrate how to use the general model to design optimal negotiation strategy. The results of the dissertation provide schemes that can be applied to design and conduct future negotiations.

This dissertation focuses on econometric methodology and its applications in insurance and the stock market. The second chapter proposes a new semiparametric estimator for binary-choice single-index models. The estimator makes use of a "parametric start" idea from the statistics literature and applies it to econometric model estimation. Even though the chapter only focuses on binary-choice models, it is expected that the introduction of this idea to the econometrics literature is going to contribute to semiparametric estimation of econometric models in general, especially when one has (only) a rough initial guess about the shape of the unknown function. Consistency of the estimator is shown and the simulation results indicate that even though the parametric start is not correct in any of the simulation designs, the estimator's performance is very promising in the estimation of coefficients and probabilities. The third chapter successfully applies this proposed estimator along with competing parametric and semiparametric estimators and is expected to expand our understanding of private insurance company involvement in the U.S. crop insurance program. This chapter stands almost alone in the literature as an overwhelming majority of other studies examine the involvement of producers in the program. Although preliminary, the results of this chapter show that the insurance company involvement in this program may be too costly to justify and that the program may not be as efficient in terms of premium rates and rating practices of the federal government. The fourth chapter examines market volatility taking into account the New York Stock Exchange trading collar. The trading collar restricts certain forms of trade in component stocks of the S&P500 stock price index when there is "excess" volatility in the market. This important feature of the market has been ignored in the large volatility modeling literature and it is expected that this chapter contributes to this literature by showing that after some data manipulation it is straightforward to incorporate this feature into standard econometric models. Another contribution of this chapter is the successful use of a polynomial specification to capture the well documented U-shaped pattern of intraday market volatility instead of a computationally more difficult two-step procedure.

<p>While nationalism remains a vital element in the production of the political and economic landscape, it is often treated as a static container for other processes or neglected altogether. Rather, it must itself be treated as a process&mdash;a nationalizing project&mdash;emerging from a constellation of often contradictory social forces. One such process of nationalization is the development of large-scale transportation infrastructure, such as railroads. These projects produce both new spheres of circulation and new understandings critical to navigating these novel environments, which together radically transform the relation between people, government, and territory. </p><p> In early twentieth century China, the complicated contest over railroad rights produced and was produced by a fractured political economic geography. Understandings of both identity and space remained fragmented, cohering only partially into a singular entity, thus demonstrating the intimate interrelation between state power, political identity, and territories both real and imagined. </p>

The thesis shows two possible ways in which intergenerational redistributions associated with a reform from a comprehensive income tax to a direct consumption tax are affected when the standard models studying this phenomenon are extended. The usual models studying the welfare impact of a direct consumption tax reform on transitional generations use numerically simulated overlapping generation general equilibrium models with strict life-cycle savers and a single production sector. The models examine the welfare impact of moving from a comprehensive income tax to either an expenditure tax or a wage tax; business taxes are ignored and assumed to "pass through" to individuals. One important result of these studies is that the expenditure tax reform results in large steady state welfare gains at the cost of imposing substantial welfare losses on the initial elderly generations. In marked contrast, a wage tax reform creates welfare gains to the elderly generations but results in lower steady state welfare gains (or even losses). This thesis tests the robustness of these conclusions under two important conditions ignored by these models. First, the thesis incorporates an explicit business sector in these models and studies the impact of implementing the two above described consumption taxes with an additional reform of replacing the business income tax with a business cash flow tax. Intergenerational redistributions are altered and difference in steady state welfare gains are much smaller under such consumption tax reforms. Second, the thesis shows how practically feasible transition rules can lower intergenerational redistributions without affecting the final steady state values. A variety of transition rules, both in business and individual sectors, are studied in this context.

The simple market efficiency hypothesis implies that prediction errors, such as forward less spot exchange rates, will be orthogonal to elements of the information set. One can therefore test for market efficiency via ordinary least squares by regressing the prediction errors on pieces of information available at the time the predictions are made and checking if the intercept term and slope coefficients are jointly equal to zero. Two econometric complications have to be dealt with when testing for market efficiency in the above manner. The first complication arises from the fact that multi-period-ahead predictions lead to an inter-temporal band structure for the covariance matrix. This complication can be handled by employing Hansen's Generalized Method of Moments (GMM) estimate which takes explicit account of the band structure of the covariance matrix. The second complication arises from the fact that the disturbances in the regression may also be heteroskedastic. Insofar as heteroskedasticity might adversely affect inference, we propose a White-type test that indicates whether or not a covariance matrix correction for heteroskedasticity is necessary. The test essentially checks if the difference between the homoskedastic and heteroskedastic consistent forms of Hansen's GMM estimate tend towards zero. Monte Carlo experiments examining the performance of the proposed test show that at least in large samples, the White-type test works well under a variety of heteroskedastic specifications. By actually applying the above procedures to test the simple foreign exchange market efficiency hypothesis, we find that for particular regression specifications and data sets, it does not make a practical difference whether we base inferences on the homoskedastic or the heteroskedastic consistent forms of Hansen's GMM covariance estimate. For other data sets and regression specifications, however, we are able to reject market efficiency only if we use the appropriate form of Hansen's GMM estimate as determined by the White-type test.

This study addresses the impact of Mexican illegal immigration on the U.S. labor market. It constitutes a first step towards developing rigorous structural econometric models that empirically analyze undocumented labor force dynamics. Structural estimation of the labor supply and the participation decision of illegal Mexican immigration requires the solution of intricate theoretical problems that have not been addressed in previous literature. The analysis developed here identifies those problems and proposes innovative solutions. In particular, undocumented participation in the U.S. labor market is studied in the context of life cycle theory and stochastic behavior. The empirical part of the analysis reviews the problems of sample selection and missing observations that characterize the available data on Mexican migration. The proposed empirical specification is evaluated employing limited dependent variables procedures, where a Tobit simultaneous equation model is solved using maximum likelihood methods. According to the empirical results, Mexican undocumented immigration may be viewed as a transitory phenomenon. Individuals switch back and forth between Mexico and the U.S. reacting not only to income differentials, but also to social, family and economic attachments in their home-communities. Mexican workers seem to have little incentives to invest in human capital specific to the U.S., such as the ability to speak English. This behavior may be result of the partial transferability of Mexican skills, i.e. formal education, to the secondary market in the United States. Finally, contrary to conventional wisdom, the empirical evidence suggests that exogenous increases in U.S. wages, i.e. a non-expected hike in the legal minimum wage, may actually discourage Mexican undocumented participation in the U.S. labor market.

The Apartheid system in South Africa came to a close recently and a new majority government is ruling. This government represents a poor majority of the population, and there is great pressure on them to redistribute wealth in favor of their supporters, the poor. This thesis consists of three essays. The first estimates the distribution of personal wealth in South Africa according to the estate multiplier method. It is found that the distribution is skewed, but not more so than in countries for which similar studies have been done. The distribution of wealth is, however, distributed along racial lines, which makes the distribution politically unacceptable. The white minority which constitutes 16 percent of the total population, owns more than 90 percent of all personal wealth. The second part studies the major political role players in South Africa and their behavior in the Constitution making process that is still underway. A model of optimal behavior by political groups is constructed, and it is found that the majority government in South Africa will act rationally if they opt for majority rule in a unitary state. That is exactly what the ANC-government has been doing since the beginning of the negotiation process. The behavior of the other groups is also found to be rational and predictable within the context of the model. The third part of the thesis consists of a computable general equilibrium model with overlapping generations. Three groups are modeled--a rich group, a middle class, and a poor group. A government implements three possible redistributive policy measures. First, the tax on the capital income which accrues to the two more affluent groups, is increased; second, an estate tax is implemented, and third, the sales tax is increased. The first policy measure improves upon the wealth distribution, but is inefficient. The second policy, which is implemented according to the lifetime endowment view of tax equity, generally improves upon the wealth distribution, and is relatively efficient under certain assumptions. The third policy may be very harmful to the poor.