After initial widespread use of private cars under the “common road” concept of early railways, railroad-owned freight cars predominated from the 1840's through the 1860's, except for a short-lived boom in cars owned by “fast freight” lines. From this time on, however, the percentage of private cars has increased as railroads refused to build specialized freight cars because of high initial costs, rapid technological obsolescence, outside pressure, and managerial shortsightedness.

The economics of slavery in the United States has long been a subject of great interest to historians, but the use of bondsmen in southern industries has been little studied. Professor Starobin not only provides new information on industrial slavery, but also offers important conclusions concerning the profitability, efficiency, and viability of this “peculiar institution.”

Recent studies of the progressive era by Gabriel Kolko and Robert Wiebe have proven that much reform legislation was supported by many of the interests against which the bills were ostensibly written. Professor Caine shows that, in at least one important state, railroads fought reform bitterly, accepting the principle of regulation only when conservative administration of the Railroad Regulation Act of 1905 offered them unexpected protection from progressive reformers.

Recently, Lusztig and Schwab [5] drew attention to a problem which occurs when applying linear programming methods to portfolio selection where capital is rationed over several investment periods. The problem is to determine the relevant discount rate with which to calculate the net present values of the objective function when this same rate is dependent upon the optimal solution to the linear program. Lusztig and Schwab suggested a neat procedure by which it was claimed that one could overcome this difficulty and which also does not rely upon the measurement of subjective utility as did the Baumol and Quandt approach [2]. It was decided to test the Lusztig and Schwab model (afterwards called the L-S procedure for brevity) on a hypothetical problem, and doing so resulted in two conclusions:

(a) The L–S procedure, as described, is incomplete but with small modification may be useful; however,

(b) concentration upon the discount rate problem in isolation from other capital budgeting problems may well be a pointless exercise.

Recently, several researchers, including Evans, Archer [1], Latané, and Young [2], have performed empirical analyses of the relationship between the number of securities in a portfolio and the reduction in portfolio dispersion. In this note, an exact mathematical relationship between these two factors is presented.

The relationship between return on assets and their riskiness is one of the liveliest topics in financial literature. In his 1952 landmark article, Markowitz developed a mathematical model that captured this key financial concept. defined risk as the variance of the rate of return of a portfolio. Later, Sharpe hypothesized a positive linear relationship between expected rate of return on an asset and the risk premium associated with that asset. Subsequently, Sharpe tested this hypothesis empirically and found support for his theory. Although portfolio theory specifies the two parameters of this model as ex ante return and risk, Sharpe used ex post data for testing the risk-return relationship. designated the ex post mean rate of return obtained on an an asset as a proxy for expected return and the standard deviation of ex post annual rates of return as a surrogate for risk.

Researchers and political analysts concerned with the inter-regional flow of mortgage funds have often pointed to the existence of yield differentials as prima facie evidence of misallocation of capital and national resources. Limited information and myopic lending horizons, with market imperfections reinforced by state laws and institutional segmentation, have been postulated. They are regarded as responsible for costly “frictions” in the export of capitalto the fast-growing, generally low-income, states, particularly those of the South. Both federal and state legislative action, intensified private arbitrage, and better secondary market facilities and instruments are then urged to improve inter-regional financial mediation to reduce or eliminate the yield differentials.