Fredrik Kopsch

Determinants of mutual fund flows

The purpose of this paper is to study the determinants of aggregate fund flows to both equity and hybrid mutual funds. We test three hypotheses that help explaining the relationship between mutual fund flows and stock market returns, namely; the feedback-trader hypothesis, the price-pressure hypothesis and the information-response hypothesis. Our study relies on Swedish quarterly data on mutual fund flows over the period 1998 to 2013. The methodology is two-fold; through our structural models (AR(1)) we can say something regarding the relationship between mutual fund flows and financial macro variables. The analysis is further strengthened by utilizing a vector autoregressive model (VAR) to test for Granger causality in order to determine the order of events. Similar to both Warther (1995) and Jank (2012), we only find support for the information-response hypothesis. Additionally, we find new financial variables that have predictive power in determining mutual fund flows, namely; market fear (VIX), exchange rate, households’ expectation regarding inflation as well as outflows from mutual bond funds. Our study contributes to the body of literature in two ways. First, it complements recent findings on determinants of mutual fund flows but we also add to the knowledge by included new macro financial variables describing the real economy. Secondly, the vast majority of previous studies have used US data, we add to that a deeper understanding of determinants of mutual fund flows in smaller economies by using Swedish data.

Municipal land allocations: a key for understanding tenure and social mix patterns in Stockholm

ABSTRACT A socially mixed population is a political ambition in Stockholm. By providing a mix of tenure alternatives throughout all neighbourhoods this objective could, at least partially, be fulfilled. Since current tenure proportions display a weak balance in many neighbourhoods it could be assumed that governing politicians – by primarily utilizing Stockholm’s vast landownership and municipal housing developers – attempt to bridge observed gaps. Distribution of new rental and ownership apartments in municipal land allocations should acknowledge the existing tenure composition in a neighbourhood. Methodically this article focuses on all (nearly 50,000) apartments channelled through Stockholm’s land allocation system between 2002 and 2012. After classification of all apartments based on tenure, location, year and developer (private or municipal) the information is merged with yearly housing stock characteristics for 128 neighbourhoods. The outcome is a unique data set allowing for statistical assessment of whether Stockholm’s tenure (and in extension social) mix ambition is reflected in practice. The present article aims to highlight the crucial importance of landownership in Swedish municipalities with an aspiration to achieve or maintain a balanced tenure mix. While the findings indicate Stockholm is complying fairly well with its ambition, the results do reveal some contradicting signs.

Winners, Losers and Optimal Re-location of a Mining Town: An Approach Using Alonso Bid-Rent Functions

Abstract Kiruna, a mining town in the northern part of Sweden, is currently facing a serious planning problem. Rich quantities of iron ore underneath the town centre have led to a decision to re-locate the city and its residents. However, this does not affect all residents as some live just outside the risk zone. Thus, a re-distribution of wealth will occur when the distance to the town centre changes. This paper addresses two issues; first, is the re-location efficient in terms of this wealth re-distribution, that is, are the gains in property values larger than the losses from moving the city to the new location? and second, does the new location of Kiruna yield an efficient outcome, or could planners have chosen another location that would result in larger gains and smaller losses? Using a measure derived from Alonso bid-rent functions which is estimated with the spatial Durbin model, both these questions are assessed and the results indicate that moving the city centre does lead to gains that outweigh the losses, however, the proposed location of Kiruna does not yield an optimal result from this perspective.