New Heritage Doll Essay Example for Free

New Heritage Doll Essay This paper summarizes recent studies in behavioral finance—particularly regarding market anomalies and investor behavior—that are not reconciled with the traditional finance paradigms. This paper differs from previous survey literature in several aspects. We introduce more recent papers in the field, more literature on behavioral corporate finance, and provide statistics on the recent trends that are explored in behavioral finance papers. We expand the research scope to studies on Korean financial markets, introduce specific funds using behavioral finance techniques, and discuss the challenges facing behavioral finance. Keywords: Behavioral finance, Market anomalies, Market efficiency, Survey of literature *  Hyoyoun Park: Credit Analyst, Euler Hermes Hong Kong Services Limited, Suites 403-11, 4/F Cityplaza 4, 12 Taikoo Wan Road, Taikoo Shing, Hong Kong; phone: +852-3665-8934; e-mail: [emailprotected] **  Wook Sohn (Corresponding author): Professor, KDI School of Public Policy and Management, 87 Hoegiro, Seoul 130-868, Korea; phone: +82-2-3299-1062; e-mail: [emailprotected] kdischool.ac.kr. 4 Seoul Journal of Business INTRODUCTION Although Modern Portfolio Theory (MPT) and the Efficient Market Hypothesis (EMH), which represent standard finance, are successful, the alternative approach of behavioral finance includes psychological and sociological issues when investigating market anomalies and individual investor behavior. In the financial markets, we often observe some phenomena which cannot be explained rationally. For example, we do not have any logical evidences on random walk in the stock price movement while many fund managers use several behavioral concepts in their investment strategy. In corporate perspectives, company owners and managers do not rely only on logical elements to make critical decisions on mergers and acquisitions and new investment. Two of the key topics discussed in behavioral finance are the behavioral finance macro, which recognizes â€Å"anomalies† in the EMH that behavioral models can explain, and the behavioral finance micro, which recognizes individual investor behavior, or biases that are not explained by the traditional models incorporating rational behavior. In particular, we employ the behavioral finance micro because it explains a number of important financing and investment patterns by using a behavioral approach, which expands on the research in the behavioral corporate finance field. This paper summarizes these two major topics in behavioral finance, which include behavioral corporate finance, and introduces evidence that adopts behavioral concepts in the actual financial market. It also describes challenges to behavioral finance by reviewing recent studies and surveys. Recently acknowledged theories in academic finance are called standard or traditional finance theories. Based on the standard finance paradigm, scholars have sought to understand financial markets using models that presume that investors are rational. MPT and the EMH form the basis of traditional finance models1). How1) Harry Markowitz introduced MPT in 1952,  and he illustrated relationships between portfolio choices and beliefs in terms of the â€Å"expected returns–variance of returns† rule. Ricciardi and Simon (2000) defined MPT as an expected return, while standard deviations of particular securities or portfolios are correlated with the other securities or mutual funds held within one portfolio. Another major concept is known as the EMH, which states that investors cannot consistently  ever, if researchers only use the MPT and EMH, individual investor behavior is not easily understood. In contrast, behavioral finance is a relatively new concept in the financial markets, and is not employed within standard finance models; it replaces traditional finance models, and it offers a better model for human behavior. Although MPT and the EMH are considered as successful in financial market analysis, the behavioral finance model has been developed as one of the alternative theories for standard finance. Behavioral finance examines the impact of psychology on market participants’ behavior and the resulting outcomes in markets, focusing on how individual investors make decisions: in particular, how they interpret and act on specific information. Investors do not always have rational and predictable reactions when examined through the lens of quantitative models, which means that investors’ decision-making processes also include cognitive biases and affective (emotional) aspects. The behavioral finance model emphasizes investor behavior, leading to various market anomalies and inefficiencies. This new concept for finance explains individual behavior and group behavior by integrating the fields of sociology, psychology, and other behavioral sciences. It also predicts financial markets. Research in behavioral corporate finance studies highlights investors’ and managers’ irrationality, and shows nonstandard preferences, and judgmental biases in managerial decisions. Currently, many companies apply behavioral approaches to determine important finance and investment patterns. Several theories under the banner of traditional finance develop specific models by assuming the EMH and they explain  phenomena in markets; however, in the real financial market, many problems and cases cannot easily be explained via those standardized  models. In the cases involving managers or investors, unbiased forecasts about future events need to be developed and used to make decisions that best serve their own interests. In this type of situation, we need to entertain more realistic behavioral aspects, as there is evidence for irrational behavior patterns that cannot be explained by the traditional or standard financial theories. To be specific, Shefrin (2009) pointed out that the root cause of the global  achieve an excessive return over market returns on a risk-adjusted basis because all publicly available information is already reflected in a security’s market price, and the current security price is its fair value. Financial crisis of 2008 was a psychological, not fundamental phenomenon. Risk-seeking behaviors were evident in the loss-dominant markets, while excessive optimism and confirmation bias acted as driving factors behind the crisis, and not fundamental factors such as terrorism, skyrocketing oil prices, or disruptive changes in the weather. We can understand, identify, and address psychological distortions in judgments and decisions by considering behavioral concepts, and then we can integrate both traditional and behavioral factors to be better prepared for dealing with any psychological challenges. As mentioned, managerial decisions are strongly affected by cognitive biases and emotional aspects in real financial markets, as human beings are not machines. Additionally, evidence of  mispricing and market anomalies that cannot be fully explained by traditional models, is prevalent. Thus, we would like to propose behavioral finance in this paper to clearly explain a number of important financing and investment patterns, aiding  investors in understanding several abnormal phenomena by integrating behavioral concepts with existing. Ricciardi and Simon (2000) defined behavioral finance in the following manner: â€Å"Behavioral finance attempts to explain and increase understanding of the reasoning patterns of investors, including the emotional processes involved and the degree to which they influence the decision-making process. Essentially, behavioral finance attempts to explain the what, why, and how of finance and investment, from a human perspective† (Page 2) (See figure 1). Shefrin (2000), however, mentioned the difference between cognitive and affective (emotional) factors: â€Å"cognitive aspects concern the way people organize their information, while the emotional aspects deal with the way people feel as they register information† (Page 29). We understand that there are several survey literatures on behavioral finance. However, this paper differs from the literature in several aspects. We introduce more recent papers in the field and expand the research scope to studies on Korean financial markets. We introduce more literature on behavioral corporate finance, provide statistics on the recent trends that are evident in behavioral finance papers, introduce the specific funds that are using behavioral finance techniques, and discuss the challenges of the behavioral finance model. Source: Ricciardi and Simon (2000)  particularly regarding market anomalies and investor behavior, which cannot  be explained by traditional finance paradigms. In section 2, we introduce two topics in behavioral finance: cognitive biases and the limits of arbitrage. In section 3, we summarize the research on behavioral corporate finance. In section 4, we examine behavioral applications via two routes: evidence from real investments and specific evidence from the Korean financial market. In section 5, we analyze the recent developments in behavioral finance publications. Section 6 discusses several challenges to behavioral finance and ends with suggestions for future research. TWO TOPICS IN BEHAVIORAL FINANCE Behavioral finance is a study that combines psychology and economics, and it tries to explain various events that take place in financial markets. For example, from the behavioral finance  perspective, some individuals’ limitations and problems are shown in the expected utility theory and in arbitrage assumptions. In particular, there are two representative topics in behavioral finance: cognitive psychology and the limits of arbitrage.2) Cognitive Biases Under the traditional and standard financial theories, investors are viewed as being rational. Basically, a rational economic person is an individual who tries to achieve discretely specified goals in the most comprehensive and consistent way while minimizing any economic costs. A rational economic person’s choices are determined by his or her utility function.

Transformation of Japan Essay -- History Historical Japanese Essays

Transformation of Japan During the time period between the 1850s and 1950s, Japan underwent massive changes politically, economically, and socially. Acknowledging the failure of isolation, Japan imitated the West in an attempt to modernize, however, still retaining its own identity. A reorganized and more centralized government allowed Japan to industrialize in half the time it took the nations of Western Europe. Industrialization provided Japan with the tools needed to transform itself from a half civilized and â€Å"backwards† society during isolation, to a dominating superpower during WWII.   Ã‚  Ã‚  Ã‚  Ã‚  In 1853 during the Tokugawa shogunate, Matthew Perry, an American commodore, arrived with an army at Edo Bay to coerce the Japanese government to allow the Americans to trade. In 1856, Japan signed a treaty opening two ports to the United States trade. Soon, other nations such as Britain, Russia, and Holland won similar rights. The opening of Japan to the West created opposition among its people and in the 1860s political crisis came into the open. In 1866, civil war broke out. The samurai armed with the surplus of weapons from the American Civil War defeated the shogunate force. The civil war ended, when the victorious reform group proclaimed Mutsuhito, often called the â€Å"Meiji† meaning enlightened one, emperor.   Ã‚  Ã‚  Ã‚  Ã‚  The new Meiji government promptly went about making reforms to the political structure. Feudalism was abolished and replaced with a system, similar to that of the French, of nationally appointing prefects, or district administrators. In the 1870s, the samurai class was abolished and a draft was created to produce a new army.   Ã‚  Ã‚  Ã‚  Ã‚  Meiji leaders traveled abroad to study economic organization, political institutions, and technological advances. The bureaucracy was reorganized and opened to men of talent through the civil service exams. In 1889, a new constitution was issued based on German prototype. It recognized the supremacy of the emperor, but limited the powers for the lower house of Diet. Under the constitution, the emperor commanded the military and chose his own ministers. The Diet had power to pass law and budget if both sides agreed. Voting rights were determined by the amount of property owned; leaving the majority of the population the inability to vote. Japan’s government was centralized and authoritarian, but incorporated busines... ...shment of the samurai and their fixed salaries that were replaced by worthless government bonds, many became poor. However, during industrialization individual samurai, as well as, several peasants were able to find opportunities and thus could gain social mobility.   Ã‚  Ã‚  Ã‚  Ã‚  Many Japanese copied Western clothing and hairstyles as an attempt to modernize. Japan adopted the Western calendar and metric system. Education incorporated Western teaching in science and mathematics. Several Japanese converted to Christianity. Despite adopting Western trends, the Japanese managed to preserve their traditional values.   Ã‚  Ã‚  Ã‚  Ã‚  In conclusion, Japan became a world giant equal to their Western counterparts. Isolation ended with forced entry by the West. The Japanese government effectively centralized and laid the foundations for industrialization. Industrialization led to economic growth. Economic growth led to a shift in foreign policy to imperialism. In the stages of imperialism, the military took control of government, thus their entry into WWII. After WWII, Japan was slightly devastated but still was able to recover and situate themselves as a dominant superpower for years to follow.   Ã‚  Ã‚  Ã‚  Ã‚  

Crown Cork and Seal

Crown Cork and Seal Competitive Environment Analysis Exercise Corporate Purpose Crown Cork and Seal had three segments Metal Containers (cans), Closures (crowns), and packaging equipment. Metal containers are cans used in things such as soft drinks or aerosol cans. These were made from steel until being switched over to aluminum in the early 80’s. Crowns which are closures for any type item such as a jar. â€Å"Metal containers generated 65% of Crown’s $1. 88 billion 1988 sales, while closures generated 30% and packaging equipment 5%. † The mission of Crown Cork and Seal was to â€Å"be successful. To do this Connelly had to take control of cost. He did this by first trimming the workforce by letting go anyone not needed which reduced payroll by 24%. â€Å"The second step was to institute the concept of accountability. † He did this by instilling pride and a sense of workmanship in the employees. He also gave plant managers â€Å"responsibility for plan t profitability† as well as quality and customer service. Last but not leased he focused on the company’s debt. He paid off the banks through â€Å"inventory reduction and liquidation. †His vision and strategy for the future emphasized â€Å"cost efficiency, quality, and customer service. Connelly did this by focusing on the company’s strengths. He was able to improve on their strengths by focusing on the beverage can and new aerosol market. Simultaneously, he improved manufacturing including adapting to customer needs. Environment Analysis: General Environment: Demographic: 1989 over 120,795,000 metal cans were sold. Socio-Culture: The movement away from metal cans to plastic and glass has been a problem as they gain a bigger market share. Political-Legal:Political will play a big part in recycling and the push for â€Å"going green. This will also take effect for the legal aspects as new laws will be in place for more recycling and cleaners running man ufacturing plants. Technological:Shut down old out dated plants and opened up new plants across the US with new equipment. Economic: As higher gas prices hit lighter products such as plastic will be more economical to ship to customers verses a heavier metal can. Global: Connelly focused on international growth. He specifically targeted developing countries. Soon foreign plants generated 44% of sales and 54% of operating profits. Competitive environment: Buyers The competitive environment for the buyers appears to favor the buyers over Crown Cork and Seal and its competitors for many reasons. Major buyers in this industry include Coca-Cola Company and Incorporated, Anheuser-Busch, and PepsiCo. In other words there are a low number of buyers, all of which are very large and powerful companies. The size distribution is mostly centered on these major buyers; however there are other companies such as Seagram’s, Molson, and Labatt. Because there are so few companies for CCS to sell to, a high percentage of sales are dependent on these buyers. This low number of buyers is due to consolidation within the soft drink segment, from 8,000 bottlers in 1980 to about 800 in 1989. Generally 45% of the total cost to buyers went into purchasing the cans. Due to the total cost of cans, buyers try to maintain many relationships with many can makers to increase bargaining power and reduce costs. As a result of this the buyer is not heavily dependent on one single can company. Switching costs are also lower for buyers for the same reason; they already have many resources to choose from. Buyers also are likely to profit fairly well compared to can manufacturers. Can manufacturers must maintain low prices in order to compete with each other to gain share over these very few yet powerful buyers. Some brewers are avoiding switching costs all together through backward entry into the market. By 1989, due to production of cans by â€Å"captive† plants, 25% of all can output was produced by captive plants. By 1980 brewers had capability to supply 55% of their can needs. As a result threat of backward entry is very likely for brewers. It is easier for brewers to do this because they make high-volume single-label products. While at the same time soft drink industry could not easily do this because they focused on low-volume multiple-label products. The aluminum can has three major substitutes buyers can choose from: Plastic bottles, which constituted for 11% of soft drink sales in 1989 along with a growth rate from 9 to 18% from 1980 to 1989; Glass bottles, which constituted for 14% of sales in the soft drink industry in 1989; and steel cans. The aluminum can however is a unique and valuable product to the industry, which is why they constituted for 75% of total sales in 1989. As stated in the case aluminum has many advantages over its substitutes. Aluminum is lighter than glass and steel, aluminum is easy to handle and fill, aluminum allows for a wider variety of graphics options, and also consumers prefer aluminum. Because this product is so unique and advanced, it absolutely increases the buyer’s product quality. Cans have a longer shelf life than plastics and bottles, they are lighter and easier to handle, and since they are coated with a protected seal inside the can taste is not sacrificed. All of which add value and quality to the finished product given to be consumed. Suppliers There are three large aluminum suppliers: Alcoa, Alcan, and Reynolds Metals. Alcoa is the largest producer of aluminum with sales of $9. 8 billion, Alcan ranked a close second with $8. 5 billion in sales, and Reynolds Metals is ranked second in the united states with sales of $5. 6 billion. The percentage of our supplies that come from large suppliers are 21% aluminum and 23% steel. Crown Cork and Seal represents 61% of sales for large suppliers. The supplied product is unique in that they have injected the aluminum cans gas to help the metal retain its shape. This allows the cans to hold more than just caffeinated beverages. Also, the steel is produced thinner to cut costs and weight and there are even steel/ aluminum mixes. In addition to aluminum and steel, there are glass and plastic suppliers that offer unique products based on function. There are always substitutes for a particular supplied product. With the advancement in technology, a cheaper, lighter product could be developed or a new innovative product could be discovered. For example: Bottling has transitioned over the decades from being primarily glass, then to steel, and now aluminum. The cost for switching a particular supplied product would be $20-$25 million based on the finding of switching from three piece to two piece cans. From reviewing the case, there does not seem to be a supplier that is excessively profitable. Even though Alcoa has the largest share of the market making $9. 8 billion in sales, Alcan is not too far behind with the $8. 5 billion. The other suppliers could always come out with a product which would give them a greater competitive advantage, and give threaten Alcoa’s top ranking position. In addition to profitability, there is a great likely hood to forward entry by a supplier. Reynolds Metals, who is a supplier, sold over 11 billion cans itself. The supplier’s product is very important to our product quality. The difference between the value of resources used and the value of the aluminum can to the brewer makes up the surplus value between what the supplier sells the aluminum for and what Crown Cork and Seal can get for it. Competitors Entrants There are a number of threatening entrants to the can manufacturing business. As the market continues to see more suppliers producing cans, and more brewers skipping the middle man (can manufacturer), the threat becomes more serious. Substitutes The shift towards plastic bottles, and perhaps more innovative materials are the threats to substitutes for cans. Corporate Profitability and Productivity: Please See Appendix A Threats to Competitive Equilibrium A 10X force that may come from the general environment to greatly disturb Crown Cork and Seal’s equilibrium in the market might be a socio-cultural shift to be more health conscious. This may hurt the soft drink industry especially hard since they are so high in sugar and there is an epidemic of diabetes and childhood obesity in America. In 1989, soft drinks accounted for more than 50% of the beverage industry. If the health craze were to gain momentum, it could cut into soft drink sales severely. This would increase the market for water and juices. However, water and juice tend to come in plastic containers for the most part. Crown, Cork & Seal never got into the plastics market and this could be a huge problem for them. If they do not find a new market for their products they might be left out in the cold once a health revolution occurs in society. The impact on sales would be overwhelming. This would bring profits way down and they may even start to have losses if they do not make adjustments fast enough. Their assets may also decrease in value because there would be less demand for can making machines due to an increase in the need for plastics making machines. With this massive shift in end-user sentiment, Crown, Cork, and Seal would have trouble convincing investors and banks to bet on them thus increasing their cost of capital greatly. A 10X force from the competitive environment could come from Crown, Cork, and Seal’s buyers, especially soft drink bottlers. There has been a trend of consolidation among soft drink bottlers and they have used this to gain leverage over their suppliers and get discounts for their bulk orders. If they were to continue with this trend of consolidation, it could create a scenario in which the bottlers could make their cans in-house cheaper than ordering them from companies like Crown, Cork, and Seal. This would be devastating for Crown, Cork, and Seal to say the least. Since soft drink bottlers are Crown, Cork, and Seal’s largest buyer, this would likely put so much stress on the company that it would eventually become obsolete unless the trend changed or the company shifted their focus before it was too late. This 10X force would bring sales way down for Crown, Cork, and Seal. Even if their sales were not hit as hard as possible, their profits would likely suffer anyway because of the pressure their buyers would be able to put on them with the threat of in-house can manufacturing. Their assets would not drop too much in value because there would still be a market for can manufacturing equipment in this scenario. Crown, Cork, and Seal would likely find it more difficult to attract investors to their company and even their cost of debt would increase with a likely decrease in the rating of their bonds. These two setbacks would drive up their cost of capital and make it difficult to raise money to shift their focus if they wait too long to do so.

The Bog Bodies of Europe - Archeological Finds

The term bog bodies (or bog people) is used to refer to ancient, naturally-mummified human burials recovered from peat bogs in Denmark, Germany, The Netherlands, Britain, and Ireland. The highly acidic peat acts as a remarkable preservative, leaving the clothing and skin intact, and creating poignant and memorable images of people of the past. Fast Facts: Bog Bodies Bog bodies are hundreds of human remains recovered from peat bogs in Europe since the 15th centuryMost date between 800 BCE–400 CEThe oldest dates to the Neolithic (8000 BCE); the most recent 1000 CEThe best-preserved were placed in acidic pools in How Many Bog Bodies Are There? Estimates of the number of bodies pulled from the bog range between 200–700. The reason there is such a great discrepancy is partly that they were first rediscovered in the 15th century and records are shaky. One historic reference dated to 1450 is of a group of peasants in Bonsdà ¶rp, Germany, who found a mans body stuck in a peat bog with a noose around his neck. The parish priest said to leave him there; other instances have occurred where the bodies have been brought to churchyards for reburial, but in this case, the priest said, the elves had clearly placed him there. The oldest bog body is Koelbjerg Man, a skeletalized body recovered from a peat bog in Denmark and dated to the Neolithic (Maglemosian) period about 8,000 BCE. The most recent dates to about 1000 CE, the skeletonized Sedelsberger Dose Man from Germany. By far, most of the bodies were placed in the bogs during the European Iron Age and Roman period, between about 800 BC and CE 400. Why Are They Preserved? The bodies are most fascinating to us because the state of preservation occasionally allows us to see a persons face from so long ago that you might recognize them. Those are very few: many of the bog bodies are only body parts—heads, hands, legs—some have skin with hair but no bones; some are bones and hair but no skin or flesh. Some are only partly preserved. The best-preserved are the ones that were placed in acidic pools of water in a peat bog during the winter. Bogs permit the best state of preservation if: the water is deep enough to prevent attack by maggots, rodents or foxes and adequately oxygen-deficient to prevent bacterial decay;the pool contains sufficient tannic acid to preserver the outer layers; andthe temperature of the water is below 4 degrees Celsius. The evidence clearly shows that the best-preserved bodies were placed in the bogs during the winter—even the contents of the stomachs reveal that, but it was likely that bog burials stemming from ritual sacrifices and executions occurred year-round. Estonian Peat Bog Lake in Winter. APeriamPhotography / iStock / Getty Images Plus Why Were They Put There? In almost all cases, the bodies were deliberately placed into the pools. Many of the bodies were either murdered, or executed for some crime, or ritually sacrificed. Many of them are naked, and sometimes the clothes are placed near the body—also well-preserved. It isnt just bodies that are preserved, the Assendelver Polders Project preserves several houses from an Iron Age village near Amsterdam. According to the Roman historian Tacitus (56–120 CE), there were executions and sacrifices under Germanic law: traitors and deserters were hung, and poor fighters and notorious evil-livers were plunged into marshes and pinned there. Certainly, many of the bog bodies are dated to the period in which Tacitus was writing. Tacitus is generally thought to be a propagandist to one way or another, so his exaggerating the barbaric customs of a subject people is perhaps likely: but there is no doubt that some of the Iron Age burials were hung, and some bodies were pinned into the marshes.   Bog Bodies Denmark: Grauballe Man, Tollund Man, Huldre Fen Woman, Egtved Girl, Trundholm Sun Chariot (not a body, but from a Danish bog all the same) Germany: Kayhausen Boy UK: Lindow Man Ireland: Gallagh Man Selected Sources Carlie, Anne, et al. Archaeology, Forensics and the Death of a Child in Late Neolithic Sweden. Antiquity 88.342 (2014): 1148–63.  Fredengren, Christina. Unexpected Encounters with Deep Time Enchantment. Bog Bodies, Crannogs and ‘Otherworldly’ Sites. The Materializing Powers of Disjunctures in Time. World Archaeology 48.4 (2016): 482–99.  Granite, Guinevere. Understanding the Death and Burial of Northern European Bog Bodies. Diversity of Sacrifice: Form and Function of Sacrificial Practices in the Ancient World and Beyond. Ed. Murray, Carrie Ann. Albany: State University of New York Press, 2016. 211–22.  Nielsen, Nina H., et al. Diet and Radiocarbon Dating of Tollund Man: New Analyses of an Iron Age Bog Body from Denmark. Radiocarbon 60.5 (2018): 1533–45.  Therkorn, L. L., et al. An Early Iron Age Farmstead: Site Q of the Assendelver Polders Project. Proceedings of the Prehistoric Society 50.1 (1984): 351–73.  Villa, Chiara, an d Niels Lynnerup. Hounsfield Units Ranges in CT-Scans of Bog Bodies and Mummies. Anthropologischer Anzeiger 69.2 (2012): 127–45.