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This article proposes the entropy of m2 (m is the stochastic discount factor) as a metric to evaluate asset-pricing models. We develop a bound on the entropy of m2 when m correctly prices a finite number of returns and consider models that pass the lower bound on m, yet fail the lower bound on m2. Interpreting our results, we elaborate on the distinction between the entropy of m2 versus the entropy of m. We further show that the entropy of m2 represents an upper bound on the expected excess (log) return of the security with the payoff of m.
The purpose of this paper is to examine whether different supervisory styles are relevant in facilitating or inhibiting job crafting, and whether job crafting plays a significant role in promoting self-competence and work performance. Data were gathered from 162 employees in a large manufacturing company. We found a positive relationship between promotive control and job crafting, and a negative relationship between restrictive control and job crafting. Some job crafting behaviors positively affect both self-competence and performance, while others have a negative effect. Our results suggest that organizations interested in promoting job crafting should encourage a promotive style of leadership.