cssi/SciSciGPT-SciSciNet huggingface dataset:
Choosing between gifts and bequests: How taxes affect the timing of wealth transfers

Abstract A number of theories have been advanced to explain the size and timing of intergenerational transfers. One factor only recently explored is the effects of taxes, and in particular the estate tax, on such transfers. This paper represents the first attempt to explore how capital gains and gift taxes, in addition to the estate tax, interact to influence incentives in the timing of transfers. Using estate tax data and exploiting variations in state inheritance, gift, and capital gains tax rates, this paper finds taxes to be an important consideration in the choice between gifts and bequests. In particular, each of capital gains and gift taxes are found to be important determinants of the timing of transfers. These findings are robust to a number of specifications that control for borrowing, charitable bequests, marital status, and the portfolio composition of wealth transfers.
Challenger Entry and Voter Learning

We develop a model of strategic interaction between voters and potential electoral challengers to sitting incumbents, in which the very fact of a costly challenge conveys relevant information to voters. Given incumbent failure in office, challenger entry is more likely, but the threat of entry by inferior challengers creates an incentive for citizens to become more politically informed. At the same time, challenges to incumbents who perform well can neutralize a voter's positive assessment of incumbent qualifications. How a voter becomes politically informed can in turn deter challengers of different levels of competence from running, depending on the electoral environment. The model permits us to sharpen our understanding of retrospective voting, the incumbency advantage, and the relationship between electoral competition and voter welfare, while pointing to new interpretations of, and future avenues for, empirical research on elections.
Strategic Offsetting Behavior in the NBA: An Analysis of the Effects of the Mikan Rule

This brief article estimates the effects of a rule change from the early days of professional basketball. The Mikan rule was intended to curb the offensive potency of tall players whose primary contribution to team output consisted of points scored close to the basket. The Mikan rule limited players’ ability to stand close to the basket, and hence made it more difficult for these players to score. However, the rule change did not account for strategic offsetting behavior—that defensive players’ optimal allocation of resources would change in response to the rule. I engage the literature on strategic offsetting behavior and estimate a two-way fixed effects model that strongly suggests the Mikan rule did not have its intended effect due to strategic offsetting behavior.
Evaluating Public Access Ombuds Programs: An analysis of the experiences of Virginia, Iowa and Arizona in creating and implementing ombuds offices to handle disputes arising under open government laws

Ombuds offices have been established in several states to oversee disputes arising under state open government laws. The author conducted case studies of three of these programs. Using Dispute Systems Design theory, this article analyzes the major themes uncovered in the case studies of Virginia’s Freedom of Information Advisory Council, created in 2000; Iowa’s public records and open meetings position in the state office of the Citizens’ Aide/Ombudsman, established in 2001; and Arizona’s assistant ombuds for public access, created in 2007 in the Ombudsman/Citizens’ Aide office. Results showed that the offices largely comported with the major goals of ombuds programs – independence, impartiality, and providing a credible review process – but weaknesses in perceptions of impartiality hurt the development of the Iowa and Arizona programs. The program with the most perceived success, Virginia’s FOI Advisory Council, also appeared to embrace the tenets of Dispute Systems Design the most in the creation and implementation of the office, such as involving stakeholders and actively pursuing buy-in of government groups in the early days of the program. In conclusion, this article offers best practices for designing new ombuds offices or improving existing programs.
Aggregation Bias in Sponsored Search Data: The Curse and the Cure

Recently there has been significant interest in studying consumer behavior in sponsored search advertising SSA. Researchers have typically used daily data from search engines containing measures such as average bid, average ad position, total impressions, clicks, and cost for each keyword in the advertiser's campaign. A variety of random utility models have been estimated using such data and the results have helped researchers explore the factors that drive consumer click and conversion propensities. However, virtually every analysis of this kind has ignored the intraday variation in ad position. We show that estimating random utility models on aggregated daily data without accounting for this variation will lead to systematically biased estimates. Specifically, the impact of ad position on click-through rate CTR is attenuated and the predicted CTR is higher than the actual CTR. We analytically demonstrate the existence of the bias and show the effect of the bias on the equilibrium of the SSA auction. Using a large data set from a major search engine, we measure the magnitude of bias and quantify the losses suffered by the search engine and an advertiser using aggregate data. The search engine revenue loss can be as high as 11% due to aggregation bias. We also present a few data summarization techniques that can be used by search engines to reduce or eliminate the bias.
Robust predictions under finite depth of reasoning

This paper elucidates how predictions in the depth of reasoning model, special cases of which include the Level-k and Cognitive Hierarchy models are robust to the common knowledge assumption of level-0 players’ actions in two-player case. A prediction of the model is said to be p-dominant if level-0 players play a p-dominant action pair in the prediction. A sufficient condition is provided for a p-dominant prediction being robust to incomplete information a la Kajii and Morris (1997). Depending on assumed players’ decision rules, even a p-dominant prediction with p ≥ 1=2 can be robust. A key mechanism behind this result is the effect of players’ limited depth of reasoning on their strategic interaction through higher order beliefs, which is implied by Strzalecki (2010) in the case of Rubinstein’s (1989) email game.
Regime-switching factor models in which the number of factors defines the regime

Abstract We develop regime-switching factor models in which the number of factors determines the operative economic regime. To illustrate the proposed methodology, we analyze the covariance structure of a widely studied set of 25 equity portfolios.
Measuring Welfare Losses from Hypoxia: The Case of North Carolina Brown Shrimp

AbstractWhile environmental stressors such as hypoxia (low dissolved oxygen) are perceived as a threat to the productivity of coastal ecosystems, policy makers have little information about the eco...
Assault and Battery on Property

Both criminal and tort law seek, in part, to respond to the harm inflicted on persons’ organic, human bodies, through hitting, offensive groping, rape, stabbing, gunshots, vehicular homicide, and more. But could there be such a thing as assault and battery on a person’s inorganic, non-human body? A battery on one’s prosthetic arm, on one’s wheelchair, one’s cochlear implant? Even a battery on one’s iPhone or computer, which some users have provocatively begun to call their “exobrain”? For instance, is it a battery if a gang of thugs smashes a man’s prosthetic arm to bits while the arm is detached from his body and he is outside the room? If the company that made the arm “bricks” it in response to the man’s violation of an end user license agreement (EULA) that he signed when he purchased the arm?In this article, I investigate whether there is any use in employing metaphors such as “exobrain,” “battery on a wheelchair,” and the like. I first argue that the metaphors are not entirely fanciful because the social, as opposed to pre-social, body is the body that matters, and there is no clear-cut definition of what our culture considers to be part of the social body. I then explore what is gained, and potentially lost, by calling an iPhone an “exobrain,” rather than merely a “very important piece of property.”
The post-.COM internet: toward regular and objective procedures for internet governance

Abstract This article makes the case for using regular and objective procedures to assign new Internet top-level domain names (TLDs) instead of the unscheduled, irregular, discretionary and ad hoc processes and criteria currently used by the Internet Corporation for Assigned Names and Numbers (ICANN). The paper shows that ICANNs current approach to TLD additions is anti-competitive and fosters rent-seeking, political strife, and the potential for corruption. The article argues that there is now and likely always will be demand for TLD additions. The article suggests that ICANN's role is not to second-guess the marketplace by choosing which of these TLDs are “good ideas” or most likely to succeed, but simply to coordinate TLD assignments. The article concludes by anticipating arguments that might be advanced against the proposed procedure, and welcoming the initial steps of ICANN, the OECD, and WIPO to address this issue.
Action research pedagogy in a new cultural setting: The Syrian experience

Copyright 2007, SAGE Publications. This is a pre-copyedited version of an article accepted for publication in the edited journal Action Research following peer review. The definitive publisher-authenticated version is available through SAGE Publications: http://ARJ.sagepub.com/content/vol5/issue3. See also: http://www.eself-learning-arabic.cornell.edu/publications.htm#6
Exploring the Revenue Mix of Nonprofit Organizations: Does It Relate to Publicness?:

Nonprofits receive funding from multiple revenue sources, including private contributions and earned program revenues. In this article, we hypothesize that the composition of revenues is a result of the nature of services provided—specifically whether services are public, private, or mixed in the nature of their benefits. Using subfields from three major fields in the National Taxonomy of Exempt Entities (NTEE), this study divides nonprofits according to service type and estimates the impact of service character on particular revenue streams and overall revenue diversification. Generally, we find that the proportion of revenues generated by earned program revenues is lowest for the category deemed public, highest for those with mostly private benefits, and midway for those classified as mixed. Similarly, the more public a nonprofit’s services, the greater its reliance on donations. We also identify some puzzling results that suggest the need for continued investigation.
Beyond the Torture Memos: Perceptual Filters, Cultural Commitments, and Partisan Identity

Who should face accountability for the mistreatment of prisoners in the war on terror? Five years ago, the scope of prisoner abuse at Abu Ghraib was first revealed; this year, the Justice Department admitted that a single suspect was waterboarded 183 times. Some at the bottom of the political hierarchy have already been convicted for their participation in prisoner abuse. Those closer to the top of the political hierarchy also find their actions subject to scrutiny, as the Department of Justice's Office of Professional Responsibility is carrying out an investigation into the professional conduct of the lawyers who authored the memos permitting "enhanced interrogation." This article argues that efforts to hold the memo authors professionally accountable for their advice will face two difficulties. First, it will likely be difficult to prove that the memos were written in bad faith. While legal scholars and other lawyers agree nearly universally that the memos represent bad legal advice, bad advice does not necessarily equate to bad-faith advice. The existence of perceptual filters and deep partisan identification may have shaped the lawyers' views of the situation in ways that appear unfathomable to outsiders. Second, even if the Office of Professional Responsibility finds evidence of professional misconduct, there is a risk that efforts to hold the memo authors accountable will lack political legitimacy. Onlookers will also view such efforts through their own perceptual frameworks and partisan commitments, and may therefore not agree that the memo authors' conduct deserves to be punished. In particular, this article argues that between 2005 and 2009 there was a redefinition of cultural commitments associated with partisan identity. In 2004 there was still a broad anti-torture American identity, but that identity became fragmented by 2008, with support for torture breaking along partisan lines. In time, cultural commitments may again shift to allow a united American identity that condemns torture. Until that happens, however, it is likely that accountability efforts will further entrench partisan animosity.
A theory of exploitative child labor

We develop a model in which some child labor is exploitative. Since exploited child laborers are paid less than the value of the marginal product of labor, there is scope for policy intervention to be Pareto improving. We illustrate this by showing that a system of inspection and fines targeted on exploitative child labor increases the aggregate output produced by children. We also establish that such intervention secures the release of children from exploitative working conditions, to their benefit. The distributional implications of the intervention among employers and among children who had not been exploited depends on whether capital is mobile internationally, and can depend on whether the elimination of exploitative child labor is partial or complete. Copyright 2008 , Oxford University Press.
The Concept of Authorship in Comparative Copyright Law

In contemporary debates over copyright, the figure of the author is too-often absent. As a result, these discussions tend to lose sight of copyright's role in fostering creativity. I believe that refocussing discussion on authors-the constitutional subjects of copyrightshould restore a proper perspective on copyright law, as a system designed to advance the public goal of expanding knowledge, by means of stimulating the efforts and imaginations of private creative actors. Copyright cannot be understood merely as a grudgingly tolerated way station on the road to the public domain. Nor does a view of copyright as a necessary incentive to invest in dissemination of copy-vulnerable productions adequately account for the nature and scope of legal protections. Much of copyright law in the United States and abroad makes sense only if one recognizes the centrality of the author, the human creator of the work. Because copyright arises out of the act of creating a work, authors have moral claims that neither corporate intermediaries nor consumer end-users can (straightfacedly) assert. This makes it all the more important to attempt to discern just what authorship means in today's copyright systems. This Article endeavors to explore the concept of authorship in both common law and civil law jurisdictions. It considers legislative, judicial and secondary authorities in the United States, the United Kingdom, Canada, and Australia, as well as in the civil law countries of France, Belgium, and the Netherlands. The legal systems here examined appear to agree that an author is a human being who ex* Morton L. Janklow Professor of Literary and Artistic Property Law. Columbia University School of Law. This Article is based in part on the 5th Annual Niro Distinguished Intellectual Property Lecture, delivered at the DePaul University College of Law Symposium April 12. 2002: ",The Many Faces of Authorship: Legal and Interdisciplinary Perspectives.'" Many thanks for research assistance to Carrie Casselman. Columbia Law School J.D. 2003 and Myriam Gauthier, Columbia Law School LL.M. 1997. J.D. 2002: and for helpful suggestions to Dr. Madeleine de Cock Buning (University of Utrecht), David Brennan (Melbourne University). Professor Graeme Dinwoodie (Chicago-Kent Law School). Professor Graeme W. Austin (University of Arizona College of Law), and Professor Edward Mendelson (Columbia University English Department). This Article has also greatly benefited from the observations of the Boston University Law School intellectual property workshop and the Columbia Law School faculty workshop. in particular the comments of my colleagues Richard Briffault, Michael Heller. and Alice
Goal bracketing and self-control

Abstract This paper studies the role of goal bracketing to attenuate time inconsistency. When setting non-binding goals for a multi-stage project, an agent must decide how to group, or bracket, such goals for evaluation. He can bracket broadly by setting an aggregate goal for the entire project, or narrowly by setting incremental goals for individual stages. A loss averse agent brackets optimally by trading off motivation and risk pooling, which interacts non-trivially with time discounting. An aggregate goal becomes more attractive as early-stage uncertainty increases, while incremental goals become more attractive when later-stage uncertainty increases.
Estimating the cost of strategic entry delay in pharmaceuticals: The case of Ambien CR

With the Hatch-Waxman Act of 1984, the FDA included an unchallengeable exclusivity period for newly approved drugs, independent of patents. This potentially generates an incentive for firms to strategically delay the introduction of new versions (reformulations) of drugs until just before patent expiration of the original drug. This way the reformulated drug competes mainly with newly introduced generics of the original drug. If instead, the reformulated drug was to be introduced well before the original drug’s patent expires, the reformulated drug would compete only with the original drug. While the pattern of strategic delay is well documented in the literature, its effects on consumers and firms are not. Reformulations may increase utility through improved efficacy and through fewer doses per day or a more even molecule decay rate. However, as suggested in the press and literature, it is also possible that the adoption of reformulated products is mostly the result of advertising rather than product-related benefits. Using detailed prescribing and pricing data from the prescription sleep aid market, I document significant adoption of the reformulation Ambien CR and show that it is not only driven by advertising. I use these estimates to evaluate two different policies designed to induce earlier entry of Ambien CR. I find that there are large potential gains in consumer surplus and in revenue.
Maximizing products of linear forms, and the permanent of positive semidefinite matrices

We study the convex relaxation of a polynomial optimization problem, maximizing a product of linear forms over the complex sphere. We show that this convex program is also a relaxation of the permanent of Hermitian positive semidefinite (HPSD) matrices. By analyzing a constructive randomized rounding algorithm, we obtain an improved multiplicative approximation factor to the permanent of HPSD matrices, as well as computationally efficient certificates for this approximation. We also propose an analog of van der Waerden’s conjecture for HPSD matrices, where the polynomial optimization problem is interpreted as a relaxation of the permanent.
Suicide on Campus: The Appropriate Legal Responsibility of College Personnel

Elizabeth Shin's self-immolation in her dormitory room at MIT in April 2000 was a shocking and visible reminder to the world of a recurrent problem: why do more than 1,000 of our most promising young people on campuses throughout the nation choose to end their lives each year? Most startling to parents and others who loved these young people is the discovery that very often, campus administrators, professors, and other personnel were well aware that these students were seriously suicidal: previous attempts, serious threats, and the pleas of friends for intervention are frequent clues. Yet when parents ask why they were not notified that their son or daughter was in serious emotional or psychological trouble, college administrators are likely to cite privacy laws and the adulthood age of 18 as reasons for not engaging outside family members. On the other hand, campuses sometimes react to suicidal suggestions from students in ways that seem harshly inappropriate, for example, by suspending or dismissing the student without providing any means of help: such was the well-publicized case of Jordan Nott at George Washington University. Both the Shin case and Jordan Nott's treatment resulted in lawsuits against the respective universities. This article examines the dramatic increase in campus suicides over the past few decades and argues that where college personnel have actual knowledge that an undergraduate student is suicidal, they have a duty to take reasonable steps to protect the student from self-harm, including, but not limited to, notifying the student's parents or guardian or reporting the information to an administrator who has authority to make such notification. Except in the most exigent circumstances, such notification would be sufficient to fulfill the duty. Notification of close family members would not only permit meaningful involvement on their part at a crucial point in their young person's life, it would also avoid the seeming indifference of suspension or dismissal. The notion of this duty is grounded in the doctrine of special relationship between the institution and the student, explicated in Restatement of Torts (Second) Sec. 314A and reiterated in the new Restatement of Torts (Third) Sec. 40. Federal privacy laws, which contain an emergency exception, are no barrier; Congress is considering an amendment to make this clear. Even if the family is part of the problem, there is evidence from the field of psychology that their early involvement in their student's treatment decisions is beneficial. Supporting data for the perspective of this article arise from an examination of developmental psychology and brain development during late adolescence; emerging knowledge reveals that capacities for mature judgment and impulse control develop much later than was once thought. The paper also analyzes counter-arguments and proffers refutation based upon legal argumentation, psychology, and neuro-science.
Fees, Expenditures, and the Takings Clause

The Supreme Court's recent decision in Koontz v. St. Johns River Water Management District extended heightened constitutional scrutiny to monetary exactions. But the Court did not define that term, and, arguably, it could encompass two distinct forms of conditions placed on government issued-permits: First, those that require a permit applicant to pay money to the government (which this essay refers to as a fee), and second those that require a permit applicant to engage in activities that cost money, but do not transfer money to the government (which this essay refers to as an expenditure). Based on the theoretical underpinnings of takings doctrine, and the language of the Koontz decision itself, this essay argues that heightened scrutiny should extend only to fees, and not to expenditures.
Government Spending and Budget Deficits in the Industrial Economies

Fiscal policy Nouriel Roubini and Jeffrey Sachs This paper examines the evolution of the size of government and of budget deficits in OECD economies. We highlight the rapid increase in government spending in the 1970s, the sharp rise in budget deficits and public debt after 1973, and the reversal in these trends in the 1980s. The increase in the size of government was associated in part with the slowdown in growth after 1973, but also reflected gradual adjustment of the ratio of spending to output towards a long-run target which depends on political and institutional characteristics of the economy – the political orientation of the government, the degree of wage indexation, and the degree of stability of the political system. Such factors also explain the size of budget deficits. When faced with an adverse shock, subsequent deficit reduction requires a measure of political consensus. We note that such consensus is hard to achieve in multi-party coalitions. In consequence, countries with such a political structure tended In consequence, countries with such a political structure tended toIn consequence, countries with such a political structure tended to experience much more rapid increases in their debt-GNP ratios.
Yours for Keeps: MGM v. Grokster

In MGM v. Grokster, now pending before the U.S. Supreme Court, all parties have made the assumption that most P2P file transfers infringe copyrights. Two theories contradict that assumption: a significant number of individuals who transfer files over P2P networks may have a license to do so, and the Copyright Act itself may exempt the transfer of certain categories of entertainment files over P2P networks from the definition of infringement.
The Eleventh Circuit's Selective Assault On Sentencing Discretion

Ever since the Supreme Court declared that the sentences which district courts impose on criminal defendants are to be reviewed on appeal for “unreasonableness,” the standard’s contours have remained elusive and mired in controversy, despite the Court’s repeated attempts at elucidation. In few instances is this confounding state of affairs more apparent and acute than in the Eleventh Circuit’s recent lengthy and factious en banc decision in United States v. Irey. This article explores Irey’s merits, mistakes, and lessons, trying to locate each within the broader context of the Eleventh Circuit’s sentencing jurisprudence. In doing so, the article advances three principal arguments. First, Irey represents a serious and unlawful encroachment on district courts’ sentencing discretion, one based in part on misguided notions of culpability, mental illness, deterrence, the severity of supervised release, and obeisance to the Sentencing Guidelines. Second, Irey’s lasting impact is likely an increased yet largely unjustified pressure on district courts to sentence defendants more harshly, particularly for sexual offenses. Third, Irey and its predecessors demonstrate that in reviewing for unreasonableness, the Eleventh Circuit unnecessarily and unfairly wields a single-edged sword, capable of striking what is perceived as an unduly lenient sentence yet impotent against an unduly harsh one. Recognizing the pretextual nature of much sentencing discourse - in which stakeholders inconsistently advance varyingly deferential degrees of appellate review suspiciously consonant with the practical sentencing outcomes they desire - the article concludes with a call for appellate judges to transcend such partisanship and exercise dispassionate, reasoned, and balanced (i.e., double-edged) sentencing review.
Conflicted emotions following trust-based interaction

We observed reports of conflicted (concurrent positive and negative) emotions activated after interactions in the Trust game. Our analyses reveal that activation of 20 emotional states following trust-based interaction is better explained by predictions derived from a multi-dimensional Recalibrational perspective than by predictions derived from two-dimensional Valence and Arousal perspectives. The Recalibrational perspective proposes that emotions are activated according to their functional features – for example, emotions help people achieve short or long-sighted goals by up or down-regulating behavioral propensities, whereas Valence and Arousal perspectives consider simpler hedonic dimensions lacking functional specificity. The Recalibrational perspective is also distinguished from the Valence and Arousal perspectives in that it predicts the possibility of conflicted emotions. We discuss the theoretical implications of having conflicted goals and the economic implications of having conflicted emotions.
On Portfolio Optimization: Forecasting Covariances and Choosing the Risk Model

We evaluate the performance of models for the covariance structure of stock returns, focusing on their use for optimal portfolio selection. We compare the models’ forecasts of future covariances and the optimized portfolios’ out-of-sample performance. A few factors capture the general covariance structure. Portfolio optimization helps for risk control, and a three-factor model is adequate for selecting the minimum-variance portfolio. Under a tracking error volatility criterion, which is widely used in practice, larger differences emerge across the models. In general more factors are necessary when the objective is to minimize tracking error volatility.
The Slow Decline of East Germany

Fifteen years after German reunification, the facts about slow regional convergence have born out the prediction of Barro [Barro, Robert J., 1991. Eastern Germany's long haul. The Wall Street Journal, Dow Jones and Company, May 3], except that migration out of East Germany has not slowed down. I document that in particular the 18–29 year old are leaving East Germany, and that the emigration has accelerated in recent years. I document that low wages, high unemployment and increasing reliance on social security persist across wide regions of East Germany together with these migration patterns. To understand these patterns, I use an extension of the standard labor search model introduced in Uhlig [Uhlig, Harald, 2006. Regional labor markets, network externalities and migration: The case of German reunification. American Economic Review, Papers and Proceedings 96 (2), 383–387; Uhlig, Harald, 2008. A labor-search model of regional unemployment and migration. Draft, University of Chicago] by allowing for migration and network externalities. In that theory, two equilibria can result: one with a high networking rate, high average labor productivity, low unemployment and no emigration (“West Germany”) and one with a low networking rate, low average labor productivity, high unemployment and a constant rate of emigration (“East Germany”). The model does not imply any obviously sound policies to move from the weakly networked equilibrium to the highly networked equilibrium. Journal of Comparative Economics 36 (4) (2008) 517–541.
Do Markets Care Who Chairs the Central Bank

This paper assesses the effects of central bank governor appointments on financial market expectations of monetary policy. To measure these effects, we assemble a new dataset of appointment announcements from 15 countries and conduct an event study analysis on exchange rates, bond yields, and stock prices. Our main findings are threefold. First, exchange rates and bond yields display a statistically significant response to the announcement of a new governor, especially when the appointee’s identity was not anticipated in advance. Second, the reactions are especially pronounced for central banks lacking either independence or a clear nominal anchor. Third, new governors are not generally perceived to lack credibility: there is no tendency for announcements to be associated with jumps in inflation expectations.
Coup-Proofing and Military Inefficiencies: An Experiment

ABSTRACTCoup-proofing occurs when a leader arranges his military to prevent military leaders from overthrowing him. However, coup-proofing often has the additional effect of lowering the military’s effectiveness in conflict. This article discusses coup-proofing in the context of the Nouri al-Maliki’s regime in Iraq before presenting two formal models. The first model shows when coups are possible, leaders select military commanders with lower ability but higher loyalty. The second model shows that when coups are possible, leaders rotate their military commanders to prevent any one commander from becoming too powerful. The article then presents experimental tests of the models. The results of these laboratory experiments show that leaders are more likely to select loyal commanders or rotate their commanders under the coup treatment relative to groups with no leadership turnover or with leadership turnover according to elections. Thus, when faced with the possibility of a coup, leaders intentionally lower t...
Apologies and legal settlement: An empirical examination

A. Effects of Apologies on Settlement Decisionmaking ......... 484 1. Effects of Apology on Settlement 485 2. Effects of Evidentiary Rules on Settlement 490 3. Sum m ary 491 B. Factors Influencing the Effects of Apologies 492 1. Responsibility and Injury 492 2. Effects of the Nature of the Apology 494 3. Effects of Evidentiary Rule 499 4. Sum m ary 500 IV. IMPLICATIONS OF RESULTS 501
Simple and trustworthy cluster-robust GMM inference

Abstract This paper develops a new asymptotic theory for GMM estimation and inference in the presence of clustered dependence. The key feature of our alternative asymptotics is that the number of clusters G is regarded as fixed as the sample size increases. Under the fixed- G asymptotics, we show that the Wald and t tests in two-step GMM are asymptotically pivotal only if we recenter the estimated moment process in the clustered covariance estimator (CCE). Also, the J statistic, the trinity of two-step GMM statistics (QLR, LM, and Wald), and the t statistic can be modified to have an asymptotic standard F distribution or t distribution. We suggest a finite-sample variance correction to further improve the accuracy of the F and t approximations. The proposed tests are very appealing to practitioners because the test statistics are simple modifications of conventional GMM test statistics, and critical values are readily available from F and t tables. No further simulations or resampling methods are needed. A Monte Carlo study shows that our proposed tests are more accurate than the conventional large- G asymptotic inferences.
The stock price effects from downward earnings guidance versus beating analysts' forecasts: which effect dominates?

This paper provides evidence on the net stock price effects associated with managers following a disclosure strategy of guiding earnings down to a level where they can report a positive earnings surprise. Prior literature documents a stock price premium when firms meet or beat analysts' forecasts. However, studies also show a substantial negative price response to downward earnings guidance that can potentially negate any benefit from reporting a positive earnings surprise. We find that the negative stock price effect for firms that release downward earnings guidance is substantially larger than the stock price premium from meeting analysts' forecasts. Further, this downward guidance stock price penalty persists after explicitly controlling for other news that might be disclosed by managers that voluntarily provide guidance. These findings challenge conclusions made in some prior research that the optimal disclosure strategy is to ensure a positive earnings surprise at the earnings announcement date.
The Effect of Prison Population Size on Crime Rates: Evidence from Prison Overcrowding Litigation

Simultaneity between prisoner populations and crime rates makes it difficult to isolate the causal effect of changes in prison populations on crime. To break that simultaneity, this paper uses prison overcrowding litigation in a state as an instrument for changes in the prison population. The resulting elasticities are two to three times greater than those of previous studies. A one-prisoner reduction is associated with an increase of fifteen Index I crimes per year. While calculations of the costs of crime are inherently uncertain, it appears that the social benefits associated with crime reduction equal or exceed the social costs of incarceration for the marginal prisoner.
Capitalization of R&D and the Informativeness of Stock Prices

This paper presents both a new approach to studying the consequences of accounting choice and a unique sample to examine the effects of accounting choice in the R&D context. We investigate the effect of firms' decision to capitalize R&D expenditures on the amount of information about future earnings reflected in current stock returns, as captured by the association between current-year returns and future earnings (FERC). We use a sample of UK firms, which includes both R&D capitalizers and expensers. An important feature of our tests is our use of a two-equation system to control for the endogeneity of the accounting choice (i.e. self-selection). Proponents of capitalization claim that it enables management to better communicate information about the success of projects and their probable future benefits. Consistent with this, we find that capitalization is associated with higher FERC than expensing.
The Biter Bit: Unknowable Dangers, the Third Restatement, and the Reinstatement of Liability Without Fault

This article argues that the Third Restatement of Products Liability, far from accomplishing its goal of eliminating strict liability for products, actually caused its revival. Prior to the adoption of the Third Restatement, many jurisdictions had gradually retreated from the strict products liability of Section 402A of the Second Restatement of Torts. The Third Restatement caused the courts to confront their own incremental processes and, in refusing the adopt the Third Restatement, to reinstate Section 402A of the Second Restatement in a much purer form.
Bankruptcy Section 363 Sales: Choices and Consequences

We contrast bankruptcy Section 363 Sales with the traditional path of Chapter 11 reorganization and find that among financial institutions, higher measures of creditors' coordination problems favor the Chapter 11 path, while greater profitability, available cash, asymmetric information between shareholders and creditors, and potential growth rate support the choice of 363 Sales. Among the non-financial firms, higher measures of creditors' coordination problem and available cash favor the course of Chapter 11, while greater profitability, liquidity, and asymmetric information support the path of 363 Sales. We further detect that bankruptcy Section 363 Sales exhibits lower direct fees, and it lasts significantly less time than formal Chapter 11 before the final emergence.
Outsourcing in the Healthcare Industry: Information Technology, Intellectual Property, and Allied Aspects

The healthcare industry is being impacted by advances in information technology in four major ways: first, a broad spectrum of tasks that were previously done manually can now be performed by computers; second, some tasks can be outsourced to other countries using inexpensive communications technology; third, longitudinal and societal healthcare data can now be analyzed in acceptable periods of time; and fourth, the best medical expertise can sometimes be made available without the need to transport the patient to the doctor or vice versa. The healthcare industry will increasingly use a portfolio approach comprised of three closelycoordinated components seamlessly interwoven together: healthcare tasks performed by humans on-site; healthcare tasks performed by humans off-site, including tasks performed in other countries; and healthcare tasks performed by computers without direct human involvement. Finally, this paper deals with intellectual property and legal aspects related to the three-pronged healthcare services paradigm.
Auction characteristics, seller reputation, and closing prices: evidence from eBay sales of the iPhone

We analyse auctions from eBay to determine whether seller reputation, auction timing, and auction aesthetics influence closing prices. Using a large sample of Apple iPhone auctions, we find that closing prices are influenced by the level of seller reputation, and sellers with no reputation at stake suffer a substantial loss in closing prices. Moreover, during the sample period investigated there were small arbitrage opportunities in deciding when the auction would end, and in certain aesthetics of the auction, such as using bold fonts and including pictures of the product for sale. These arbitrage opportunities were somewhat reduced when e-bay increased the prices it charged for these aesthetic upgrades six months after the sample period investigated.
The Significance of Transferred Intent

The doctrine of transferred intent (or transferred “malice” in England) generally provides that if A attempts to harm B but, because of bad aim, misses and accidentally causes the same harm to befall C, A’s harmful intent vis-a-vis B is transferred to C, thus rendering A guilty of intentionally harming C. Commentators acknowledge the doctrine to be a legal fiction, but they differ regarding whether the fiction produces just results, some believing it does, others believing that A is guilty at most of attempting to harm B rather than intentionally harming C. Commentators who agree that the fiction produces just results nevertheless differ regarding whether the fiction should be retained or whether A’s intent to harm “a” person, in this case, B, is the only intent that signifies for crimes of intentional harm, regardless of whom A eventually harms. Doug Husak sought to achieve reflective equilibrium between intuition and theory regarding bad-aim cases by proposing in 1996 that A be punished for attempting to harm B (rather than for harming C) but sentenced as if he had harmed B. I once believed that Husak was correct. But I now have doubts, in part because Husak, along with others, cannot explain why the strength of people’s intuitions regarding A’s responsibility in bad-aim cases depends upon (1) C’s being a reasonably foreseeable victim, and (2) C’s being harmed by the same threat of force that A initially unleashed against B. I argue that one cannot achieve reflective equilibrium in bad-aim cases without inquiring into why resulting harm matters in criminal law, and that when one does, one discovers that just as people’s intuitions regarding whether intentional harms are proximate depend upon how resulting harms occur, so, too, people’s intuitions regarding whether an actor is guilty of intentional harm depend upon how resulting harm comes about.
Workload Management in Telemedical Physician Triage and Other Knowledge-Based Service Systems

Telemedical physician triage (TPT) is an example of a hierarchical knowledge-based service system (HKBSS) in which a second level of decision agent (telemedical physician) renders a decision on cases referred to him or her by the primary level agents (triage nurses). Managing the speed-versus-quality trade-off in such systems presents a unique challenge because of the interplay between agent knowledge and flow of work between the two levels. We develop a novel model of agent knowledge, based on the beta distribution, and deploy it in a partially observable Markov decision process model to describe the optimal policy for deciding which cases (patients) to refer to the second level for further evaluation. We show that this policy has a monotone control-limit structure that reduces the fraction of decisions made at the upper level as workload increases. Because the optimal policy is complex, we use structural insights from it to design two practical heuristics. These heuristics enable an HKBSS to adapt effic...
Pleading with Congress to Resist the Urge to Overrule Twombly and Iqbal

In Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal, the Su preme Court changed the rhetoric of the federal pleading system. Those decisions have been decried by members of the bar, scholars, and legislators as judicial activism and a rewriting of the Federal Rules of Civil Procedure. Such criticism has led members of both houses of Congress to introduce legislation to overrule the deci sions and return to some variation of the "notice pleading" regime that existed before Twombly. This Note argues that both of the cur rent proposals to overrule Twombly and Iqbal should be rejected. Although the bills take different approaches to their goal of overrul ing Twombly and Iqbal, each one would disrupt the careful balance of interests created by the Federal Rules and create intolerable con fusion for judges ruling on the often-filed 12(b)(6) motion to dismiss. Especially because the long-term effects of Twombly and Iqbal on federal pleading remain unclear. Congress should avoid a rush to judgment on this important issue.
The generalized random priority mechanism with budgets

Abstract This paper studies allocation problems with and without monetary transfers, such as combinatorial auctions, school choice, and course allocation. Interdependent values and multidimensional signals are allowed. Despite known negative results, a mechanism exists that is feasible, ex post individually rational, ex post incentive compatible, and asymptotically both efficient and envy-free. This mechanism is a special case of the generalized random priority mechanism (GRP), which always satisfies the first three properties. The asymptotic properties follow as a corollary of the main theorem: GRP approximates virtually any infinite-market mechanism in large finite markets.
State and Local Prevalence of Firearms Ownership Measurement, Structure, and Trends

Of the readily computed proxies for the prevalence of gun ownership, one, the percentage of suicides committed with a gun, is most highly correlated with survey-based estimates. It is the best choice for use in cross-section analysis of the effect of gun prevalence on crime patterns across states and larger counties. Analysis of this proxy measure for the period 1979–1997 demonstrates that the geographic structure of gun ownership has been highly stable. That structure is closely linked to rural tradition. There is, however, some tendency toward homogenization over this period, with high-prevalence states trending down and low-prevalence states trending up.
Retribution and the Experience of Punishment

The law regulates human life, so it should be informed by the best available understanding of how people experience their lives. The new field of hedonic psychology has made breakthroughs in improving that understanding, and it would be natural for scholars and policymakers to incorporate those improvements into their approaches to legal questions.1 One such breakthrough involves psychological evidence suggesting that people adapt to imprisonment and monetary fines.2 People initially experience
Performance Responses to Competition Across Skill-Levels in Rank Order Tournaments: Field Evidence and Implications for Tournament Design

Tournaments are widely used in the economy to organize production and innovation. We study individual data on 2775 contestants in 755 software algorithm development contests with random assignment. The performance response to added contestants varies nonmonotonically across contestants of different abilities, precisely conforming to theoretical predictions. Most participants respond negatively, whereas the highest-skilled contestants respond positively. In counterfactual simulations, we interpret a number of tournament design policies (number of competitors, prize allocation and structure, number of divisions, open entry) and assess their effectiveness in shaping optimal tournament outcomes for a designer.
Transformation- based density estimation For weighted distributions

In this paper we consider the estimation of a density f on the basis of random sample from a weighted distribution G with density g given by ,where w(u) > 0 for all u and . A special case of this situation is that of length-biased sampling, where w(x) = x. In this paper we examine a simple transformation-based approach to estimating the density f. The approach is motivated by the form of the nonparametric estimator maximum likelihood of f in the same context and under a monotonicity constraint. Since the method does not depend on the specific density estimate used (only the transformation), it can be used to construct both simple density estimates (histograms or frequency polygons) and more complex methods with favorable properties (e.g., local or penalized likelihood estimates). Monte Carlo simulations indicate that transformation-based density estimation can outperform the kernel-based estimator of Jones (1991) depending on the weight function w, and leads to much better estimation of monotone densities...