A choice-based conjoint experiment was employed to identify consumer preferences for automobile loan attributes. Respondents prefer loans with low interest rates and moderate contract lengths. Less important are high rebates and moderate down payments. Rebates are most important to choice when down payment is high. Even when choosing among interest-free loans, respondents do not prefer long terms, conflicting with traditional financial rationality. Respondents appear to focus attention on the first digit of the monthly payment (payment, a function of the other attributes, was provided to respondents). This tendency was stronger among those with less education. Public policy recommendations are discussed.

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This paper studies the effects that benefits of control and moral hazard have on the evolution of large stakes in REITs. A large risk-averse shareholder trades off the net benefits of REIT business monitoring and control with the cost of bearing risk beyond the level compensated by the REIT return premium. In equilibrium, the large shareholder gradually adjusts his ownership shares level (as long as his marginal benefits from holding shares increase in his REIT stake) towards the long-run competitive equilibrium in which his marginal share valuation coincides with that of the market. Because of the moral hazard, such level of ownership (and monitoring) is, in general, inefficient. The speed of adjustment is positively correlated with the agent’s risk aversion and company volatility, and negatively correlated with his marginal benefits of control and beneficial monitoring effects. Copyright Springer Science + Business Media, Inc. 2005real estate investment trusts, corporate stock ownership, real estate returns, stock market price dynamics,

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