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It Is Time To Kill The Economic Theory Of Suicide, Gary N. Smith
It Is Time To Kill The Economic Theory Of Suicide, Gary N. Smith
Pomona Economics
A seminal paper by Hamermesh and Soss modeled suicide as a rational economic decision based on a comparison of the financial costs and benefits of staying alive. Their model is fundamentally flawed and their prediction that suicide rates increase with age is wrong.
The Effect Of The Change In Call Loan Rates And Volatility On Stock Returns In 1929: An Empirical Study Into A Determinant Of The Great Depression, Amberish Chitre
The Effect Of The Change In Call Loan Rates And Volatility On Stock Returns In 1929: An Empirical Study Into A Determinant Of The Great Depression, Amberish Chitre
CMC Senior Theses
I investigate the effect of the change in call loan rates on stock returns during 1929. Call loan rates are the interest rates on borrowed funds to trade equity on a given exchange. It is estimated that 40% of stocks during this period were bought on margin. After a price decline comes a margin call, followed by a forced sales of securities, which leads to additional margin calls and future price declines. I regress daily excess returns on the change in daily call loan rates during 1929. In addition, I estimate volatility using an ARCH model and observe the previously …