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The purpose of this paper is to explore the effect of leverage mimicking factor portfolios in explaining stock return variations. This paper broadens the focus of the current asset pricing literature by forming portfolios mimicking the leverage factor.

Following Fama and French's and Carhart's procedure in forming size, book‐to‐market and momentum mimicking portfolios, the authors of this paper form leverage mimicking factor portfolios to explain stock returns. A five factor model is constructed that explains the variations in stock returns better relative to the other asset pricing models including the Fama‐French‐Carhart four factor model.

The findings indicate that the leverage mimicking portfolio helps to explain stock return variations better relative to the other asset pricing models including the Fama‐French‐Carhart four factor model. Results are robust to other risk factors.

The results lead us to explore further avenues in using other risk factors in asset pricing such as future work to consider other cross‐sectional attributes such as the stochastic behaviour of earnings or profitability that might also produce common variation in stock returns. There may be other risk factors that carry a premium and thus can be used for asset pricing.

The paper's findings are important in fund management when selecting or evaluating portfolio performance. The authors introduce an additional factor that has a sound theoretical appeal and show that leverage mimicking factor portfolios provide additional information in pricing assets, both in the cross section of all shares and in different sectors.

To the best of the authors' knowledge this is the first study of the effect of leverage mimicking factor portfolios in explaining stock return variations.

The purpose of this paper is to examine the role of industry peers in shaping firm debt maturity decisions.

The authors use idiosyncratic equity shocks as instruments to disentangle industry fixed and peer effects. The authors also employ a three-stage least squares regression (3SLS) model to capture the correlation among thee (short, medium, and long) debt maturity decisions.

The authors find that a one standard deviation change in peer short (medium, long) maturity debt leads to a 50 percent (37 percent, 23 percent) change in firm corresponding maturity debt and that these mimetic behaviors are statistically significant within, but not between, firm size groups. The findings also reveal that firms that mimic the short and medium (long) debt maturity structure of their peers tend to increase (decrease) firm performance as measured by profitability, return-on-assets, and stock returns.

First, given the research design, the authors are constraint from pinpointing the exact date of the mimicking behaviors. This limitation prevents the authors from establishing the causality of the mimicking behavior and firm performance. Future research can extend the findings by solving this problem. Second, it should be interesting to address the question of whether mimicking behavior is good or bad for firm performance. The authors only compare the performance of Close Followers and Loose Followers; however, it would be more precise to compare the performance of mimicking firms with the performance of non-mimicking firms.

First, the findings extend the debt maturity structure literature by providing empirical evidence that an important determinant of firm debt maturity is industry peer debt maturity. Since debt maturity directly influences firm risk and performance, it is important for debt and equity holders to know how firms choose their debt maturity so that they can estimate their investment risk precisely. Second, the paper provides new empirical evidence supporting the information acquisition and principal-agent theories in demonstrating that firm performance increases when managers herd over short and medium debt maturity decisions and decreases when managers herd over long debt maturity decisions.

This study aims to investigate the effects of peers on corporate payout policies in one of the largest emerging markets – India. It also examines the motives for mimicking payout decisions.

The sample is composed of 3,024 non-financial and non-government firms listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) for the period 1995 to 2020. To encounter the endogeneity problem, the instrumental variable technique based on peer firms' idiosyncratic risk is used to estimate the effects of peers on firms' payout policy. To define peer reference groups, the authors use the basic industry classification of the firms.

The results indicate a significant positive impact of peers on firms' dividend policies in India. A firm with all dividend-paying peers is more likely to declare dividends than the one with no dividend-paying peers. Further, peer effects are found to be more pronounced amongst larger and older firms, thus supporting the rivalry theory of mimicking.

To the best of the authors' knowledge, the present study is the first of its kind that attempts to understand peer effects on payout decisions in an emerging market India, that offers a unique institutional setting. Moreover, the authors extend the existing literature by investigating the peer effects on a firm's payout policies considering various firm-level characteristics, such as growth opportunity, cash holding, financial constraint and profitability, which previous studies have not taken into consideration. These results provide additional insights into the heterogeneity and motives behind peer effects.

Here the author proposes the Mutual Insurance Model with Incentive Compatibility (MIMIC). MIMIC is a model for deposit insurance that mimics the incentives and practices of a private sector, mutual, insurance organisation. The main features of MIMIC are: fully risk‐based premiums, payments by the Federal Deposit Insurance Corporation (FDIC) to the US Treasury Department (the Treasury) for its line of credit and ‘catastrophe insurance’, rebates to banks when the reserve ratio exceeds a risk‐based ceiling, surcharges on banks when the reserve ratio dips below a risk‐based floor, dilution fees on deposit growth to maintain reserve ratio and refunds to banks to maintain reserve ratio when their deposits shrink.

The purpose of this paper is to estimate the Tanzanian shadow economy (SE) from 2003 to 2015 and test the statistical relationships between the SE and its potential causes and indicators.

The econometric analysis is based on a multiple indicators multiple causes (MIMIC) model. To calibrate the SE from the estimates, the authors adopt the value of 55.4 percentage of the SE to official GDP from the literature for the base year 2005.

The SE ranges from 52 to 61 per cent of official GDP and slightly decreases from 2013 to 2015. Increase in inflation, unemployment and government spending were the main drivers of the SE dynamics.

Given the challenges facing estimation of the SE (e.g. small sample size, exogenous estimate to calibrate the model, meaning of the latent variable), quantification of SE should be considered to be rough measures.

To lower the size of the SE, the government needs to keep inflation and unemployment stable over time, to reduce government spending because it creates pressure on tax collection due to the limited tax base.

This is the first study specifically focused on Tanzanian SE based on the MIMIC approach. Existing estimates of Tanzanian SE are calculated by monetary models or apply a common MIMIC specification to the worldwide context.

This paper contributes to the literature concerning the Nigerian informal economy (IE) by estimating its size from 1991 to 2017 and identifying the major causes.

A structural equation approach in the form of the multiple indicators multiple causes (MIMIC) method is used to estimate the size of the Nigerian IE.

The results indicate that vulnerable employment and urban population as a percentage of the total population are the main drivers of the IE in Nigeria. The IE in Nigeria ranges from 38.83% to 57.55% of gross domestic product (GDP).

As a result of the empirical challenges in the estimation of the IE, the estimates of Nigeria's IE are considered to be rough estimates.

The authors calibrated the MIMIC model with the official estimate of the informal sector published by the Nigerian National Bureau of Statistics (NBS). This was an attempt to combine the national accounting approach, to estimate the size of IE, with the MIMIC approach, and to estimate the trend of informality.

Whether the risk factors or firm characteristics cause the value premium of stocks still needs further investigation. This paper shows that the factor‐based models are significant but not sufficient for the stock returns in Taiwan. Size or book‐to‐market ratio alone cannot influence the stock returns under a factor‐based model. However, size along with book‐to‐market is significant under a factor‐based model. Furthermore, the risk characteristics are more influential than the factor load in stock return behavior. We conclude that employing only a factor‐based model or only risk characteristics will not consider some important content in stock returns.

We would like to thank C. Y. Chen, Wenchih Lee, two anonymous referees and the seminar participants at the 2000 FMA annual meeting for their helpful comments and encouragement. All of the remaining errors are our responsibility.

The purpose of this paper is to investigate how insiders’ trades are executed and whether and how outside investors can mimic outperforming insiders and reap substantial portfolio returns that withstand the erosion from adjustments for both the standard factors and stock characteristics in the asset pricing literature.

The authors design a metric for measuring insiders’ trade execution quality: the trading alpha. The authors run regression analysis to control for trade difficulty, insider reputations and the corporate role ranks of insiders and document the existence of the abnormal trading alpha. The authors further form portfolios based on the abnormal trading alpha and document a significant abnormal return that is robust to both standard asset pricing factors model and the stock characteristics adjustments.

Outperforming insiders at the aggregate level resemble value investors who trade on long-term fundamental information, trade patiently and earn rents from providing liquidity. Outside investors can mimic the outperforming insiders and reap significant abnormal portfolio returns.

Data limitations on insider trades and their association/interaction with their brokers prevent us from having a conclusive investigation of the trading skill hypothesis. The authors hope to further research along the lines of the trading skill hypothesis as compared to investment style hypothesis with more detailed data about the brokers used by insiders.

The findings can be applied for money management profession in that outsider investors can monitor the trading execution and construct portfolios based on the adjusted abnormal trading alpha. The resulting portfolio has been documented to be highly profitable after risk adjustments using standard asset pricing factors as well as stock characteristics.

Professional money managers and outsider investors should be able to benefit from the findings in this paper and use the proposed trading alpha metric to construct and rebalance real-time investment portfolios.

Outperforming insiders at the aggregate level resemble value investors who act on long-term fundamental information, trade patiently and earn rents from providing liquidity. From the perspective of investment implications, outside investors can mimic the outperforming insiders and reap substantial portfolio returns that withstand the erosion from adjustments for both the standard factors and stock characteristics in the asset pricing literature.

Eliminating overpackaging is a central question in sustainable development, and poses a dilemma for retailers. Since packaging is a differentiation tool for private labels, eliminating it could limit the capacity to give those labels an equivalent image to national brands just as much as it could be a sustainable development opportunity and a positioning instrument. Drawing on the attribution theory framework, the purpose of this paper is to examine how eliminating overpackaging influences consumers’ perception of products sold under generic and mimic private labels, and their purchase intention.

This research uses a 2 (overpackaging: present vs absent)×2 (brand concept: generic vs mimic private label) between-subjects experiment on a convenience sample of 217 French consumers. The conceptual framework was tested using ANCOVA and mediation analyses.

The experiment shows that eliminating overpackaging does have an influence on mimic private labels’ image, particularly on perceived quality, convenience and environmental friendliness. The authors also find that this influence negatively transfers to purchase intention for mimic private labels through lower perceived quality and convenience. No such effect appears for generic private labels’ image.

This study addresses an issue as yet unexplored in marketing – the effect of overpackaging on private label products – and proposes areas for managerial and societal reflection relevant to retail chains interested in eliminating overpackaging.

The purpose of this paper is to examine the effect of gender on pre‐service teachers' computer attitudes.

A total of 157 pre‐service teachers completed a survey questionnaire measuring their responses to four constructs which explain computer attitude. These were administered during the teaching term where participants were attending a technology course. Structural equation modeling, in particular, confirmatory factor analysis and multiple indicators, multiple causes (MIMIC) modeling were used for data analysis.

No statistical significance is found for gender in the four constructs of computer attitude. However, the mean scores for males are higher for three of the constructs. Overall, the data in this study provides evidence to support the notion that computer attitude is a multidimensional construct.

This study contributes to the continuing interests among researchers to study the effect of gender towards the computer. The results of this study did not support others which found significant differences in computer attitudes by gender. This may be due to heavy reliance of computers in many educational institutions for teaching and learning which consequently granted equal access to male and female users. Methodologically, this study had employed MIMIC model as the technique to assess the effect of gender on computer attitude. MIMIC modeling is superior to conventional techniques (e.g. t‐test, ANOVA) because it is capable of analyzing latent and observed indicators.