Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts
In order to examine the robustness of Basu and Markov's findings, we estimate the rationality of earnings forecasts issue based on the UK data. We employ Ordinary Least Squares (OLS) and Least Absolute Deviations (LAD) regression to test the hypothesis and obtain rejection of the null hypothes...
| Main Author: | |
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| Format: | Dissertation (University of Nottingham only) |
| Language: | English |
| Published: |
2008
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| Online Access: | https://eprints.nottingham.ac.uk/22184/ |
| _version_ | 1848792371240632320 |
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| author | Wan, Fang |
| author_facet | Wan, Fang |
| author_sort | Wan, Fang |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | In order to examine the robustness of Basu and Markov's findings, we estimate the rationality of earnings forecasts issue based on the UK data. We employ Ordinary Least Squares (OLS) and Least Absolute Deviations (LAD) regression to test the hypothesis and obtain rejection of the null hypothesis based on the statistical significant. However, consistent with Basu and Markov's studies, we emphasize on the importance of the economic significance and consider that analysts are economically rationality on account of the linear loss function. Moreover, we provide critical analysis of our methods and conclusions in the end of the article. In addition, we suggest that although analysts appear to be not able to meet rational expectation theory in the statistical level, their forecasts may still be the optimal prediction of future. |
| first_indexed | 2025-11-14T18:43:20Z |
| format | Dissertation (University of Nottingham only) |
| id | nottingham-22184 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T18:43:20Z |
| publishDate | 2008 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-221842018-02-15T13:02:00Z https://eprints.nottingham.ac.uk/22184/ Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts Wan, Fang In order to examine the robustness of Basu and Markov's findings, we estimate the rationality of earnings forecasts issue based on the UK data. We employ Ordinary Least Squares (OLS) and Least Absolute Deviations (LAD) regression to test the hypothesis and obtain rejection of the null hypothesis based on the statistical significant. However, consistent with Basu and Markov's studies, we emphasize on the importance of the economic significance and consider that analysts are economically rationality on account of the linear loss function. Moreover, we provide critical analysis of our methods and conclusions in the end of the article. In addition, we suggest that although analysts appear to be not able to meet rational expectation theory in the statistical level, their forecasts may still be the optimal prediction of future. 2008 Dissertation (University of Nottingham only) NonPeerReviewed application/pdf en https://eprints.nottingham.ac.uk/22184/1/08MAlixfw6.pdf Wan, Fang (2008) Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts. [Dissertation (University of Nottingham only)] (Unpublished) |
| spellingShingle | Wan, Fang Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts |
| title | Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts |
| title_full | Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts |
| title_fullStr | Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts |
| title_full_unstemmed | Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts |
| title_short | Compare Quadratic Loss Function with Linear Loss Function in Rational Expectation Hypothesis on Analysts' Earnings Forecasts |
| title_sort | compare quadratic loss function with linear loss function in rational expectation hypothesis on analysts' earnings forecasts |
| url | https://eprints.nottingham.ac.uk/22184/ |