By Myla Swallow and Richard Vargo
This study regresses key variables that influence the profitability of Conventional and Islamic banks as measured by Return on Average Assets, to determine the impact of Islamicity on the profitability of the banks in a given country. The study compares 36564 banks in 77 countries belonging to both Islamic and non-Islamic countries. We find that Islamic banks have higher operating costs and overall experience lower return on average assets.
Advisors: Professor Kent Kimbrough, Professor Michelle Connolly | JEL Codes: F30; G21; Z12
By Yusuke Ewan Tanaka Legard
The Overreaction Hypothesis suggests that investors overreact to unexpected news in the financial world, which leads to a mispricing of equities. This paper investigates the presence of overreaction in the Financial Times Stock Exchange (FTSE) between 1995 and 2018. The empirical methodology studies the monthly returns of equities in the FTSE 100. The empirical results are consistent with the overreaction hypothesis and indicate the presence of overreaction within the FTSE. Furthermore, the results highlight whether the information revolution has exacerbated or lessened overreaction. The results suggest that investor overreaction has not altered, for better or worse, since the information revolution.
Advisors: Professor Emma Rasiel, Professor Kent Kimbrough | JEL Codes: E7; E70; D83
By Sonia Maria Hernandez
Microfinance is the practice of extending small collateral-free loans to underserved populations in developing areas with no access to credit. The Village Savings and Loan Association (VSLA) randomized access to microfinance treatment for women in rural areas of Uganda and tracked outcomes through surveys. This research determines the impact of microfinance by analyzing outcomes over five dimensions of women’s empowerment, including decision making power, community participation, business outcomes, emotional wellness, and beliefs about women. The strongest results showed that access to the VSLA program empowered women in terms of business outcomes and decision-making power. This leads to the conclusion that microfinance can more easily impact how a woman behaves within the household than change how a woman behaves within the community.
Advisors: Professor Kent Kimbrough, Professor Lori Leachman | JEL Codes: O1, O12, O35
By Jacob Graber-Lipperman
The thesis explores the increasing success of non-original films distributed through traditional theatrical releases, and asks whether new distributors, such as Netflix, may serve as better platforms for original content. A dataset incorporating the top 100 highest-grossing films at the domestic box office each year from 2000 to 2018, as well as a smaller subset including 82 titles distributed by Netlix, was utilized to investigate these issues. The results confirm non-original content has performed increasingly well over time for theatrical releases, especially within the past four years, while original content has performed poorly, especially during this recent time period. Additionally, the research suggests the stark difference in performance observed for non-original and original content in traditional distribution models may not appear for titles released through the newer streaming platforms. This paper thus hopes to motivate future study into the effect of streaming platforms on consumer purchasing behavior of films as new distribution technology within the movie industry continues to proliferate.
Advisor: Professor Kent Kimbrough | JEL Codes: D1, D10, D19
The Impact of Access to Public Transportation on Residential Property Value: A Comparative Analysis of American Cities
By Moses Snow Wayne
This paper develops a consistent model for analyzing the impact of access to public transportation on property value applied to the four cities of Atlanta, Boston, New York, and San Francisco. This study finds a negative relationship between increasing distance to public transit and property value. Additionally, the elicited effects in each city generally align with geographic features and the degree to which a city is monocentric. This study also demonstrates the salience of using actual map-generated distances as proximity measures and characteristics of public
transit systems in modeling the relationship between public transportation and residential property value.
Advisors: Dr. Patrick Bayer and Kent Kimbrough | JEL Codes: C12, R14, R30, R41
By Justin T. Rosenblum and John H. Zipf
We investigate the efficiency of the current financial aid system for prospective college students. The Free Application for Federal Student Aid (FAFSA) form reviews a family’s financial information and universities review a student’s academic prowess, but neither fully examines students and their family’s qualitative factors such as parents’ highest education level or intended major. Using the National Center for Education Statistics’ National Postsecondary Student Aid Study, we investigate academic, financial, and familial characteristics to determine if they impact a student’s level of private loans relative to their total cost of attendance. We find that students with parents who did not receive a college degree are adversely affected by the current financial aid system. In particular, these students take out a greater amount of private loans relative to their total cost of attendance all else equal. Our finding has wider policy implications; changing the current financial aid system to assist disadvantaged students could help reduce intergenerational education inequalities. In addition, colleges could reach a broader range of students by helping
the students that currently struggle the most to pay tuition.
Advisors: Michelle Connolly, Hugh Macartney and Kent Kimbrough | JEL Codes: I2, I22, I23
By M. Thomas Marshall Jr.
When deciding on housing location, people theoretically optimize for the best location given their commute time, housing cost, income, as well as other factors. Stutzer and Frey (2008) suggest that this is not true in some nations, such as in their investigation of Germany, with their results showing that the cost of an average commute is equivalent to 35.4% of the average income. This paper investigates the impact of commute time on the well-being of individuals in the United States, correcting for various other factors that determine housing choice such as race,
age, and whether they have a child living at home. The results of this study are clearly that the relationship found between commuting time and well-being cannot be proven to be statistically significant from zero, so there is not any evidence against optimization.
Advisor: Kent Kimbrough | JEL Codes: D12, D61, R31, R41
By Christopher G. MacGibbon
This thesis develops a new Multi-Horizon Moment Conditions test for evaluating multi-horizon forecast optimality. The test is based on the variances, covariances and autocovariances of optimal forecast errors that should have a non-zero relationship for multi-horizon forecasts. A simulation study is conducted to determine the test’s size and power properties. Also, the effects of combining the Multi-Horizon Moment Conditions test and the well-known Mincer-Zarnowitz and zero autocorrelation tests into one forecast optimality test are examined. Lastly, an empirical study evaluating forecast optimality for four multi-horizon forecasts made by the Survey of Professional Forecasters is included.
Advisors: Andrew Patton, Grace Kim and Kent Kimbrough | JEL Codes: G1, G17, G00
By Michael Karamardian
Because Medicare’s prospective payment system for long-term acute-care hospitals (LTCHs) makes a large lump-sum form of payment once patients reach a minimum length-ofstay threshold, LTCHs have a unique opportunity to maximize profits by strategically discharging patients as soon as the payment is received. This analysis explores how the level of competition between LTCHs in geographic markets affects the probability of a patient being strategically discharged. The results show that patients at LTCHs in more competitive markets have a lower probability of being strategically discharged than at those in less competitive markets, suggesting increased competition could help save Medicare funding.
Advisors: Kent Kimbrough and James Roberts | JEL Codes: D22, I11, I18