American Economic Association Nashville, Tennessee 0022-0515 Journal of Economic Literature 37 2 June 1999 567567 Corrigendum: The Economics of Wagering Markets Raymond D.Sauer http://www.aeaweb.org/journal/contents/June1999.html American Economic Association Nashville, Tennessee 0022-0515 Journal of Economic Literature 37 2 June 1999 571608 Trying to Explain Home Bias in Equities and Consumption Karen K.Lewis Investors hold a substantially larger proportion of their wealth portfolios in domestic assets than standard portfolio theory would suggest, a phenomenon called "equity home bias." In the absence of this bias, investors would optimally diversify domestic output risk using foreign equities. Therefore, consumption growth rates would tend to co-move across countries even when output growth rates do not. Empirically, however, consumption growth rates tend to have a lower correlation across countries than do output growth rates, a phenomenon I call "consumption home bias." In this paper, I discuss these two biases and their potential relationship as suggested by the literature. http://www.aeaweb.org/journal/contents/June1999.html American Economic Association Nashville, Tennessee 0022-0515 Journal of Economic Literature 37 2 June 1999 609632 Adam Smith: Critical Theorist? KeithTribe The bicentenary of Adam Smith's Wealth of Nations in 1976 was marked by the publication of a new complete edition of his works and correspondence, bringing together for the first time all extant published and unpublished writings. A basis was thereby provided for serious reconsideration of Adam Smith's work, and since the early 1980s many conventional assumptions concerning Smith's work and contemporary significance have been challenged. This paper surveys the foundations upon which this new, "historical" Adam Smith has been constructed, and assesses the merits of the principal claims which have recently been made for his work. http://www.aeaweb.org/journal/contents/June1999.html American Economic Association Nashville, Tennessee 0022-0515 Journal of Economic Literature 37 2 June 1999 633665 The Numerical Reliability of Econometric Software B. D.McCulloughH. D.Vinod Numerous examples show that some econometric software packages contain serious flaws, and that users cannot safely assume that their software is accurate. A brief survey of the fundamentals of computer arithmetic discusses the sources of numerical error and emphasizes that computer arithmetic is not at all like pencil-and-paper arithmetic. Both users and developers of econometrics software should first pay attention to accuracy, and only later consider user-friendliness. Details are provided for assessing the accuracy of basic estimation routines, statistical distributions, and random number generators. More accuracy benchmarks are needed, especially for specialized econometric procedures. http://www.aeaweb.org/journal/contents/June1999.html