cssi/SciSciGPT-SciSciNet huggingface dataset:
The effect of labor strikes on security analysts' forecast superiority and on the association between risk‐adjusted stock returns and unexpected earnings*

. This paper empirically examines whether labor strikes affect the forecasting and information content of quarterly earnings numbers. We address two issues regarding financial analyst forecast (FAF) superiority: whether FAF superiority increases when a strike occurs and if so, whether the increase in FAF superiority is sustained immediately after the strike ends. We also examine two issues regarding information content: whether strikes affect the coefficient mapping unexpected earnings into stock prices and whether strikes affect the variance of stock price changes. We suggest that strikes affect both the forecasting and information content of quarterly earnings numbers. Resume. Cet article examine de facon empirique si les greves des travailleurs influencent la prevision et le contenu informatif des resultats trimestriels. Nous abordons deux questions relatives a la superiorite des previsions d'analystes financiers (PAF): a savoir si la superiorite des PAF s'accroit lorsqu'une greve se produit et, dans l'affirmative, si l'accroissement de cette superiorite se maintient immediatement apres la fin de la greve. Nous etudions egalement deux questions relatives au contenu informatif: a savoir si les greves influencent le coefficient incorporant l'impact des benefices imprevus sur le cours des actions et si les greves affectent la variance des fluctuations du cours des actions. Les greves affecteraient donc a la fois la prevision et le contenu informatif des resultats trimestriels.
Determinants of systemic risk and information dissemination

We study the effects of two measures of information dissemination on the determination of systemic risk. One measure is print-media consumer sentiment based while the other is volatility based. We find evidence that while the volatility measure (VIX) of future expectations has a more significant direct impact upon systemic risk of financial firms under distress, a consumer sentiment measure based on print-media news does impact upon firm’s financial stress via the externality of other firm’s financial stress. This latter effect is robust even though the VIX and the consumer sentiment have dynamic feedback in the short one and two-day horizon in levels, and contemporaneously in volatility. In reference to the internet bubble of the 1990s, the consumer sentiment measure predicts larger systemic risk in the whole period of exuberance while the VIX predicts a sharp larger systemic risk in the height of the bubble. Our evidence suggests that print-media consumer sentiment might be dominated by the VIX when predicting systemic risk.
What Drives the Value Premium?: The Role of Asset Risk and Leverage

This paper shows empirically how asset risk and financial leverage interact to explain the equity risk dynamics of value versus growth stocks. During economic downturns, the asset betas and leverage of value firms increase, contributing to a sharp rise in equity betas. Asset betas of growth firms are much less sensitive to economic conditions, and, consistent with the tradeoff theory of capital structure, growth firms are also less levered, contributing to the relative stability of their equity betas. By incorporating instruments that better capture beta dynamics, I show that the interactions of conditional betas with the market risk premium and volatility explain approximately 40% of the unconditional value premium. The Author 2013. Published by Oxford University Press on behalf of The Society for Financial Studies. All rights reserved. For Permissions, please e-mail: journals.permissions@oup.com., Oxford University Press.
Monetary Policy and the Natural Rate of Interest

It is most important for monetary policy to be able to track the (unobserved) natural rate of interest in environments in which that rate takes big and sustained swings away from its long run equilibrium. To establish this fact, we study two models: one is a standard New-Keynesian model; in the other, government bonds provide liquidity, and deficit financed spending shocks cause large and persistent movements in the natural rate because they create extra liquidity. Policy rules that cannot make the policy rate track the natural rate perform poorly in both of these models, but they are especially bad in the second model. Households would give up half of a percent of their onsumption each period to have a rule that could track the natural rate. Even in the standard model, households would give up a quarter of a percent of consumption to obtain such a rule. First difference rules perform quite well in this environment, and they do not require any information about the natural rate of interest. Model uncertainty is perhaps the main reason why it is difficult to track the natural rate. When model uncertainty is taken into account, the
Does geography matter? Firm location and corporate payout policy.

Abstract We investigate the impact of geography on agency costs and firm dividend policies. We argue that remote firm location increases the cost of shareholder oversight of managerial investment decisions. We hypothesize that remotely located firms facing free cash flow problems precommit to higher dividends to mitigate agency conflicts. We find that remotely located firms pay higher dividends. As expected, the effect of geography on dividends is most pronounced for firms with severe free cash flow problems. Further, remotely located firms rely more on regular dividends instead of special dividends or share repurchases and decrease dividends less often.
Advisory Board and Earnings Persistence

We examine the relationship between the board of directors and earnings persistence. We define the advisory role of board members as providing strategic counsel to top management. We argue that str...
Patents and R&D as Real Options*

This article develops and implements a simulation approach to value patents and patent-protected R&D projects based on the Real Options approach. It takes into account uncertainty in the cost-to-completion of the project, uncertainty in the cash flows to be generated from the project, and the possibility of catastrophic events that could put an end to the effort before it is completed. It also allows for the possibility of abandoning the project when costs turn out to be larger than expected or when estimated cash flows turn out to be smaller than anticipated. This abandonment option represents a very substantial part of the project’s value when the project is marginal or/and when uncertainty is large. The model presented can be used to evaluate the effects of regulation on the cost of innovation and the amount on innovative output. The main focus of the article is the pharmaceutical industry. The framework, however, applies just as well to other researchintensive industries such as software or hardware development.
Financial development and TFP growth: Cross-country and industry-level evidence

This article estimates the impact of financial development on industry-level Total Factor Productivity (TFP) growth using a largely unexploited panel of 77 countries with data for 26 manufacturing industries for the years 1965 to 2003. A significant relationship is found between financial development and industry-level TFP growth when controlling for country-time and industry-time fixed effects. The results are both statistically and economically significant. TFP growth can accelerate up to 0.6% per year, depending on the external finance requirement of industries, following a one SD increase in financial development. The results are robust to different samples and specifications.
Discovery Containment Redux

Since the major revision of the Federal Rules regarding discovery in 1970, there has been relatively continuous unhappiness in some quarters about whether discovery is out of hand, and the Advisory Committee on Civil Rules is again looking at possible amendments to the discovery rules. Working in part from the Committee's own files on the last quarter century's efforts in the area, this article traces the evolution and effects of the discovery containment amendments adopted in 1980, 1983 and 1993. This review reveals both the considerable pressures brought to bear on the Committee and its generally cautious approach to making changes. Drawing on this experience, the article suggests a number of lessons that might inform future reform efforts.
Racism Revised: Courts, Labor Law, and the Institutional Construction of Racial Animus

How should we understand and explain individual acts of racism? Despite extensive debate about the broader place and importance of racism in America, there is surprisingly little theoretical or empirical analysis of what leads individuals to commit racist acts. In contrast to most political scientists who understand racism as an individual psychological attitude—an irrational prejudice—I argue that individual manifestations of racism are the result of a complex set of factors, and that latent psychology is less helpful to understanding them than are the maneuverings and behavior of strategic actors following rules and incentives provided by institutions. We need to examine the ways in which institutions encourage racist acts by motivating people to behave in a racist manner or behave in a manner that motivates others to do so. To further explore and compare institutional and individual-psychological approaches to understanding racism, I examine manifestations of racism in labor union elections. I analyze and contrast more than 150 cases in which the National Labor Relations Board and U.S. federal appellate courts formally responded to reported violations of racism in a union election. The principles of this approach can easily be applied to other contexts and suggests that racism in society is less intractable and innate than malleable and politically determined.
Eminent Domain: A Legal and Economic Critique

Our thesis is that eminent domain is both legally impracticable and economically unnecessary for development and prosperity. We offer a brief history of eminent domain law. This law is then criticized on the grounds that all three of its main elements are highly problematic: takings, the public use exception, and just compensation. Finally, economic analysis shows that development and prosperity would be accomplished without the power of eminent domain because private parties’ self-interest would be served by selling to developers who offer a fair price, and even where holdouts still refuse to sell, their holdings can usually be built over, under, or around.
How to Read Probability Distributions as Statements about Process

Probability distributions can be read as simple expressions of information. Each continuous probability distribution describes how information changes with magnitude. Once one learns to read a probability distribution as a measurement scale of information, opportunities arise to understand the processes that generate the commonly observed patterns. Probability expressions may be parsed into four components: the dissipation of all information, except the preservation of average values, taken over the measurement scale that relates changes in observed values to changes in information, and the transformation from the underlying scale on which information dissipates to alternative scales on which probability pattern may be expressed. Information invariances set the commonly observed measurement scales and the relations between them. In particular, a measurement scale for information is defined by its invariance to specific transformations of underlying values into measurable outputs. Essentially all common distributions can be understood within this simple framework of information invariance and measurement scale.
Corporate diversification and innovation: Managerial myopia or inefficient internal capital markets?

Which is more innovative: the decentralized, diversified firm, or the centralized, more narrowly focused firm? The economics and finance literatures argue that diversified firms have innovation advantages as their operating units have access to an internal capital market. In contrast, the strategy and entrepreneurship literatures argue that managers of these firms suffer from “managerial myopia,” discouraging them from investing in projects with long‐term, uncertain payoffs. We take a fresh look at the relationship between innovation and diversification using a comprehensive sample of diversified and nondiversified firms and a novel approach that teases out the mechanisms influencing the relationship between diversification and innovation. Consistent with conceptual and empirical work in strategy, we find a robust negative correlation between diversification and R&D intensity, suggesting that diversification reduces innovation by discouraging investment. However, our analysis suggests that internal capital market inefficiencies, rather than managerial myopia, is responsible for this observed negative relationship.
New Evidence on the Financialization of Commodity Markets

This paper uses a novel dataset of commodity-linked notes (CLNs) to examine the impact of the flows of financial investors on commodity futures prices. Investor flows into and out of CLNs are passed to and withdrawn from the futures markets via issuers' trades to hedge their CLN liabilities. The flows are not based on information about futures price movements but nonetheless cause increases and decreases in commodity futures prices when they are passed through to and withdrawn from the futures markets. These finding are consistent with the hypothesis that non-information-based financial investments have important impacts on commodity prices.
Taking Another Look at Second-Look Sentencing

An unprecedented number of Americans are currently behind bars. Our high rate of incarceration, and the high bills that it generates for American taxpayers, has led to a number of proposals for sentencing reform. For example, a bill recently introduced in Congress would roll back federal mandatory minimum sentences for certain drug offenders, and the Obama Administration has announced a plan to grant clemency to hundreds of non-violent drug offenders. Perhaps the most revolutionary proposal, though, is one advanced by the drafters of the Model Penal Code, namely that judges be given the power to resentence offenders who have been serving long sentences on the ground that societal views about the seriousness of the offenses these individuals committed have changed. These evolved societal views, the drafters assert, justify reducing the offenders’ sentences. The drafters of the Code suggest that this view is based on retributivism—on what these particular defendants deserve as a result of committing these crimes. But an offender’s desert does not change as time progresses; it is societal views of desert that change. This raises a new question in criminal law about whether the original sentencer—the one imposing punishment at the time of trial—or a new sentencer—one imposing punishment over a decade after the offense was committed—is better positioned to determine the offender’s desert. The drafters of the Code proffer that a new sentencer is best because it can be more representative of modern values. But the new sentencer does not represent the public against which the offense was committed. And the new sentencer is not as well positioned to assess the offender’s culpability or the harm he caused. The new sentencer may be in a better position to know whether, as time has passed, the offender has been rehabilitated or whether he still poses a danger to society, but these factors are not based on the offender’s desert. The proposed Code provision confuses offender desert with these other utilitarian * Associate Professor of Law, SMU Dedman School of Law. I thank Anthony Colangelo, Ion Meyn, Steve Morrison, Tony O’Rourke, and Jenia Turner for their helpful comments. 2 Meghan J. Ryan [2015 considerations. These other considerations may be important, but the Code is explicitly based primarily on retributivist ideals. As a result, there is a lack of fit between the functioning of the proposed Code provision and the rationale that allegedly supports it. Utilitarian considerations are masquerading as retribution here, making it difficult to honestly and effectively assess the law. Staying within the retributivist framework of the Code, though, reliable assessments of an offender’s desert best lie with the decisionmakers in place at the time the crime was committed. 2015] Taking Another Look at Second-Look Sentencing 3
Privacy Issues Affecting Employers, Employees, and Labor Organizations

Privacy issues arise regularly in employment environments. Employers frequently assert privacy rights when denying non-employee union organizers access to employment premises and limiting the distribution of union literature or the solicitation of authorization cards by current employees. On the other hand, when employers desire to monitor employee computer usage on firm computers to be sure they are not accessing inappropriate sites or engaging in other inappropriate electronic behavior, they give short shrift to employee privacy claims. When employer premises are open to the general public, non-employee access to external areas such as parking lots might provide an appropriate accommodation between the property rights of employers and the statutory rights of employees and labor organizations. Since Internet access may be used to assist unions to communicate with employees being organized or to allow employees to communicate with each other regarding union organizing or other work related issues, this avenue of communication should not be denied to employees if they are otherwise permitted to use employer provided Internet service for non-work related purposes.
Leverage and house-price dynamics in U.S. cities

We use city-level data to analyze the relationship between homeowner borrowing patterns and house-price dynamics. Our principal finding is that in cities where a greater fraction of homeowners are highly leveraged—i.e., have high loan-to-value ratios— house prices react more sensitively to city-specific shocks, such as changes in percapita income. This finding is consistent with recent theories that emphasize the role of borrowing in shaping the behavior of asset prices.
Independent director death and CEO acquisitiveness: Build an empire or pursue a quiet life?

Research summary: This study examines the relationship between an independent director's death and CEO acquisitiveness. Using a sample of large U.S. public firms, we find that CEOs who have experienced an independent director's death undertake fewer acquisitions in the post-director death period, in particular fewer large acquisitions. Our findings are consistent with the prediction of posttraumatic growth theory that mortality awareness can induce CEOs to reevaluate their life priorities and reduce the importance of extrinsic goals in their decision making. This study contributes to the strategic leadership literature by highlighting the influence of the death of CEOs' social peers on CEOs' strategic decisions. Managerial summary: Does the death of CEOs' social peers influence CEOs' strategic decisions? We find that CEOs who have experienced an independent director's death engage in fewer acquisitions in the post-director death period, in particular fewer large acquisitions. One likely explanation for our findings is that the death of an independent director may heighten CEOs' mortality awareness, lead the CEOs to pursue a quieter life, and weaken their propensities for undertaking decisions (i.e., acquisitions) that increase their compensation and social status. Copyright © 2016 John Wiley & Sons, Ltd.
CONSUMER USE AND GOVERNMENT REGULATION OF TITLE PLEDGE LENDING

ecent years have seen growth in the use of certain types of nontraditional lending products, such as payday lending and auto title lending, and the relative decline of others, such as finance companies and pawnbrokers. Despite the fact that much of the growth in the use of these products is simply a substitution of some types of high-cost lending to others, the onset of the financial crisis has spurred renewed scrutiny of nontraditional lending products, even though there is no suggestion – much less evidence – that those products contributed to the crisis, and indeed, may be playing a positive role in mitigating the fallout from the crisis. Congress is currently considering major new regulations on short-term lending products, such as title lending, that could produce their demise even though there is no evidence that such products were related in any way to the financial crisis. The loss of this important source of credit for many Americans, especially unbanked consumers and independent small businesses, would create hardship for many Americans who rely on auto title lending to meet urgent short-term expenses for utilities, housing and home repairs, and business expenses. This negative effect would be especially painful in light of the continuing problems in credit markets that have reduced access to traditional types of credit for consumers and small businesses, such as credit cards and home equity lines of credit. Credit card issuers are reducing availability, slashing credit lines, and raising interest rates and fees, leading a growing number of consumers to turn to alternative products to address short-term credit needs. Small
Sarbanes-Oxley and the Cross-Listing Premium

This article tests whether the Sarbanes-Oxley Act ("SOX") affected the premium that investors are willing to pay for shares of foreign companies cross-listed in the United States. I find that from year-end 2001 (pre-SOX) to year-end 2002 (after SOX adoption), the Tobin's q and market/book ratios of foreign companies subject to SOX (cross-listed on levels 2 or 3) declined significantly, relative to Tobin's q and market/book ratios of both (i) matching non-cross-listed foreign companies from the same country, the same industry, and of similar size, and (ii) cross-listed companies from the same country that are not subject to SOX (listed on levels 1 or 4), whose Tobin's q and market/book ratios declined only slightly and increased in some specifications, compared to matching non-cross-listed companies. Thus, the premium associated with trading in the United States was roughly constant, while the premium associated with being subject to U.S. regulation declined. The biggest losers were companies that were more profitable, riskier, and smaller, companies with a higher level of pre-SOX disclosure, and companies from well-governed countries. These results are consistent with the view that investors expected SOX to have greater costs than benefits for cross-listed firms on average, especially for smaller firms and already well-governed firms. In a related paper, Kate Litvak, The Effect of the Sarbanes-Oxley Act on Foreign Companies Cross-Listed in the U.S., Journal of Corporate Finance, vol. 13, pp. 195-228 (2007), http://ssrn.com/abstract=876624, I conduct an event study of the reaction of level-23 cross-listed companies, and find that their prices declined during SOX-relevant event periods, relative to level-14 cross-listed companies and non-cross-listed companies.
Momentum and Reversal: Does What Goes Up Always Come Down?

The stocks in a momentum portfolio, which contribute to momentum profits, do not experience significant subsequent reversals. Conversely, stocks that do not contribute to momentum profits over the intermediate horizon exhibit subsequent reversals. Merging these separate securities into a single portfolio causes momentum and reversal patterns to appear linked. Stocks with momentum can be separated from those that exhibit reversal by sorting on size and book-to-market equity ratio. Controlling for proxies for behavioral biases, market illiquidity, and macroeconomic factors does not affect our results.
Assessing the Redistributive Effect of Fiscal Policy

Who benefits from public spending? Who bears the burden of taxation? How desirable is the distribution of net benefits from the operation of a tax-benefit system? This paper surveys basic concepts, methods, and modeling approaches commonly used to address these issues in the context of fiscal incidence analysis. The review covers the incidence of both taxation and public spending. Methodological points are supported by country cases. The effective distribution of benefits and burdens associated with fiscal policy depends on the size of the government, the distributive mechanisms involved, and the incentives properties of the policy under consideration. This creates a need for analytical methods to account for both individual behavior and social interaction. The approaches reviewed include simple reduced form regression analysis, microsimulation models (both the envelope and discrete choice models), computable general equilibrium modeling, and approaches that link computable general equilibrium models to microsimulation models. Explicit modeling facilitates the construction of counterfactuals to back up causal analysis. Social desirability is assessed on the basis of progressivity along with deadweight loss.
Foundations of Organizational Trust: What Matters to Different Stakeholders?

Prior research on organizational trust has not rigorously examined the context specificity of trust nor distinguished between the potentially varying dimensions along which different stakeholders base their trust. As a result, dominant conceptualizations of organizational trust are overly generalized. Building on existing research on organizational trust and stakeholder theory, we introduce a more nuanced perspective on the nature of organizational trust. We develop a framework that distinguishes between organizational stakeholders along two dimensions: depth of the relationship (deep or shallow) and locus (internal or external). The framework identifies which of six dimensions of trustworthiness (benevolence, integrity, managerial competence, technical competence, transparency, and identification) will be relevant to which stakeholder type. We test the predictions of our framework using original survey data from 1,298 respondents across four stakeholder groups from four different organizations. The results reveal that the relevant dimensions of trustworthiness vary systematically across different stakeholder types and provide strong support for the validity of the depth and locus dimensions.
Case Study: The Creative Evolution of Steria: From French Venture to European Leader without Loss of Entrepreneurial Spirit and Control (1969–2004)

This case study discusses the five stages of growth of Steria, separated by four crises, and show how these crises were resolved through the creativity and statesmanship of the founder-CEO and his successor. It analyses the key factors that contributed to the success of Steria and conclude by showing that the continuing innovative family-like culture and creative leadership were the underlying forces that drove Steria's evolution.
The Muezzin's Call and the Dow Jones Bell: On the Necessity of Realism in the Study of Islamic Law

The central flaw in the current approach to shari'a in the American legal academy is the reliance on the false assumption that contemporary Islamic rules are derived from classical doctrine. This has led both admirers and detractors of the manner in which shari'a is studied to focus their energies on obsolete medieval rules that bear no relationship to the manner in which modern Muslims approach shari'a. The reality is that given the structural pluralism of the rules of the classical era, there is no sensible way that modern rules could be derived from classical doctrine, either in letter or in spirit, and all efforts to do so have largely failed. As with all historical approaches to the law, the past becomes no more than an invention of the present, a means to validate an approach rather than any true reflection of the practices and norms of a previous era. Thus, modern Islamic rules are not a resurrection of classical era rules, but rather are largely the product of mediation among competing influences in Muslim society. Within and even beyond Islamic finance, the two major influences are, on the one hand, resistance, clothed in Islamic rhetoric, against the dominant global economic and political order in order to create a separate Muslim sphere within which the Muslim polity may operate, and on the other, the need to engage the broader global order, commercially and politically, in order to restore some level of political and economic power to the Muslim world. A proper study of influences of this sort that have led large numbers of Muslims to adopt particular shari'a positions on economics, finance, war, and numerous other realms is absolutely vital in the post 9/11 era in order to understand and engage substantial, important segments of the Muslim community in their call for a reinvigoration of the shari'a.
Tracing the Woes: An Empirical Analysis of the Airline Industry

The US airline industry went through tremendous turmoil in the early 2000s, with four major bankruptcies, two major mergers, and various changes in network structure. This paper presents a structural model of the industry, and estimates the impact of demand and supply changes on profitability. Compared with 1999, we find that, in 2006, air-travel demand was 8 percent more price sensitive, passengers displayed a stronger preference for nonstop flights, and changes in marginal cost significantly favored nonstop flights. Together with the expansion of low-cost carriers, they explain more than 80 percent of legacy carriers' variable profit reduction.
Second-Order Diverse in Name Only?: Sovereign Authority in Disaggregated Institutions

In Second-Order Diversity and Dissenting by Deciding, Heather Gerken makes a powerful case that the individuals who are usually on the fringe of our governing institutions — the dissenters, the minorities, the outsiders — exercise power in our majoritarian system that can be undermined if we promote a conception of diversity that treats all institutions as unitary and identical. Second-order diversity encourages institutional experimentation by providing a forum for dissenters and electoral minorities to exercise power on behalf of the state and engage in policymaking. Gerken's theory allows minorities to “dissent by deciding” since, in some disaggregated institutions, these individuals control the outcome and influence the broader spectrum of democratic decision-making.In this essay, written for a festschrift in honor of Heather Gerken, I argue that promoting second order diversity as a normative ideal may not require the same level of sovereign authority that we typically think of in the context of "hard" federalism, which is the traditional conception of the states and the federal government as being sovereign within their respective regulatory spheres. Hard federalism would seem to require the existence of a "formal enclave" in order to protect the decisions of dissenters, a notion that Gerken does not embrace. At the very least, her theory requires a strong conception of autonomy, where electoral minorities have plenary authority and can exercise meaningful power in their respective subunits. By focusing on juries and electoral districts, this essay fleshes out the extent to which the decision-making authority of electoral minorities is insulated when they are exercising power on behalf of the state. In operationalizing Gerken’s thesis, the goal of this analysis is to make the normative commitment to second order diversity mean more than simply dissenters having power in name only, but it does so within the context of a sovereignty/autonomy based framework that is considerably more flexible than that offered by traditional federalism theory.
Reputation penalties for poor monitoring of executive pay: Evidence from option backdating

Abstract We study whether outside directors are held accountable for poor monitoring of executive compensation by examining the reputation penalties to directors of firms involved in the option backdating (BD) scandal of 2006–2007. We find that, at firms involved in BD, significant penalties accrued to compensation committee members (particularly those who served during the BD period) both in terms of votes withheld when up for election and in terms of turnover, especially in more severe cases of BD. However, directors of BD firms did not suffer similar penalties at non-BD firms, raising the question of whether reputation penalties for poor oversight of executive pay are large enough to affect the ex ante incentives of directors.
Does Delaware law improve firm value

I present evidence consistent with the theory that Delaware corporate law improves firm value and facilitates the sale of public firms. Using Tobin’s Q as an estimate of firm value, I find that Delaware firms are worth significantly more than similar firms incorporated elsewhere. The result is robust to controls for firm size, diversification, profitability, investment opportunity, industry, managerial ownership, and unobservable firm heterogeneity. Delaware firms are also significantly more likely to receive takeover bids and be acquired. Results are robust to controls for endogeneity. r 2001 Elsevier Science S.A. All rights reserved.
On the choice of the unit period in time series models

When estimating the parameters of a process, researchers can choose the reference unit of time (unit period) for their study. Frequently, they set the unit period equal to the observation interval. However, I show that decoupling the unit period from the observation interval facilitates the comparison of parameter estimates across studies with different data sampling frequencies. If the unit period is standardized across these studies, then the parameters will represent the same attributes of the underlying process, and their interpretation will be independent of the sampling frequency.
Atomic structures of respiratory complex III2, complex IV, and supercomplex III2-IV from vascular plants.

Most living things including plants and animals use respiration to release energy from food. Respiration requires the activity of five large protein complexes typically called complex I, II, III, IV and V. Sometimes these complexes combine to form supercomplexes. The complexes are similar across plants, animals and other living things, but there are also many differences. Detailed structures of the respiratory complexes have been determined for many species of animals, fungi and bacteria, highlighting similarities and differences between organisms, and providing clues as to how respiration works. Yet, there is still a lot to learn about these complexes in plants. To bridge this gap, Maldonado et al. used a technique called cryo electron microscopy to study the structure of complexes III and IV and the supercomplex they form in the mung bean. This is the first study of the detailed structure of these two complexes in plants. The results showed many similarities to other species, as well as several features that are specific to plants. The way the two complexes interact to form a supercomplex is different than in other species, as are several other, smaller, structural features. Further examination of complex III revealed that it is flexible and that movements are coordinated across the length of the complex. Maldonado et al. speculate that this may allow it to coordinate its role in respiration with its other cellular roles. Understanding how plant respiratory complexes work could lead to improvements in crop yields or, since respiration is required for survival, result in the development of herbicides that block respiration in plants more effectively and specifically. Further researching the structure of the plant respiratory complexes and supercomplexes could also shed light on how plants adapt to different environments, including how they change to survive global warming.
Nothing New, Man!—The Second Circuit’s Clarification of Insider Trading Liability in United States v. Newman Comes at a Critical Juncture in the Evolution of Insider Trading

On December 10, 2014, in United States v. Newman, the U.S. Court of Appeals for the Second Circuit clarified what is required for remote tippees to be liable in insider trading cases. The government has argued that the Newman decision is unprecedented and will make it far more difficult to prosecute insider trading defendants. This Note argues that the Newman decision is consistent with precedent and the principles of criminal law and comes at a critical juncture where the SEC’s prosecutorial tactics do not square with the common law. Importantly, Newman reins in prosecutorial overreaching aimed at those who are least culpable and will hopefully shift the government’s focus to the crux of the problem: corporate insiders who tip material, nonpublic information for a per-
Do property taxes affect real operating decisions and market prices for crude oil

This study investigates the effect of property taxes on real business decisions. Consistent with tax avoidance, we posit that personal property tax rates are associated with decreases (increases) in inventory prior to (following) assessment dates. We empirically test this prediction using both United States and Canadian monthly crude oil inventory data. We find that in locations where raw materials inventory is subject to taxation, total and refinery-level crude oil inventories are reduced prior to assessment dates and increased in the following period, when compared to locations with no (or lower) tax rates. The results provide empirical evidence that property taxes play a role in the operating decisions of firms. We also examine the pricing implications of these tax driven changes in crude oil inventory and find that the market seemingly adjusts crude oil prices around assessment dates demonstrating that the market acts as if it understands these changes in crude oil inventory are not simply due to supply/demand effects.
The causal effect of commute time on labor supply: Evidence from a natural experiment involving substitute teachers

Abstract The effect of commute time on labor supply is estimated in a unique labor market in which workers are subject to daily exogenous variation in commute time and are free to make daily labor supply decisions: substitute teaching. Data on both accepted and rejected job offers received by substitute teachers are used to estimate a sequential binary-choice model of job-offer acceptance decisions. The elasticity of the offer–acceptance probability with respect to commute time is found to be about −0.4. The aversion to commuting is about 36% larger on extremely cold mornings, but precipitation has essentially zero impact on commuting preferences. The effect of fuel price is of the expected sign, but imprecisely estimated. Women are particularly averse to commuting on cold mornings and are more sensitive to variation in fuel prices than men, but no statistically significant difference in the overall aversion to commuting is found between men and women.
Observers in spacetime and nonlocality

Characteristics of observers in relativity theory are critically examined. For field measurements in Minkowski spacetime, the Bohr-Rosenfeld principle implies that the connection between actual (i.e., noninertial) and inertial observers must be nonlocal. Nonlocal electrodynamics of non-uniformly rotating observers is discussed and the consequences of this theory for the phenomenon of spin-rotation coupling are briefly explored.
Supplier Encroachment as an Enhancement or a Hindrance to Nonlinear Pricing

The objective of this study was to extend existing understanding of supplier encroachment to contexts in which there is information asymmetry and the supplier can use nonlinear pricing. Prior research has shown that supplier encroachment can mitigate double marginalization and thus benefit both the supplier and the reseller. However, under symmetric information, this benefit disappears if the supplier can use nonlinear pricing. In our model, the reseller observes the true market size while the supplier knows only the prior distribution, that is, a seemingly ideal setting for implementing mechanism design through nonlinear pricing. We first show that, because encroachment capability enables the supplier to make an ex post output decision, it fundamentally alters the structure of the optimal nonlinear pricing policy. In addition to the usual downward distortion effect, where the reseller may purchase less than the efficient quantity, we also have the possibility for upward distortion. Thus, under asymmetric information and nonlinear pricing, supplier encroachment has two opposing effects. On one hand, the ability to shift sales to the direct channel allows the supplier to reduce information rents with less sacrifice of efficiency; but on the other hand, by introducing the possibility of her own opportunistic behavior, it can result in upward distortion of the quantities sold through the reselling channel, which is a new source of inefficiency. Depending upon the relative efficiency of the reselling channel and the demand distribution, either of these two effects may dominate and the supplier's ability to encroach may either benefit or hurt both the supplier and the reseller.
After the Ball Is Over: Investor Remedies in the Wake of the Dot-Com Crash and Recent Corporate Scandals

The stock market crash that followed the high tech stock bubble of the 1990s revealed numerous fraudulent practices by companies and securities professionals. The article discusses how investors may seek redress for those losses, particularly by claims against their stock brokers in arbitration.
A Tragedy of the Anticommons: The Economic Inefficiencies of Space Law

An economic analysis of (i) the property rights regime governing outer space and (ii) the leading proposals for reform. The article also offers a novel, efficient and realistic two-step approach.
The Effects of Employer Matching in 401(k) Plans

This paper uses data from the April 1993 pension supplements to the Current Population Survey (CPS) to investigate the impact of employer matching and employee tenure on participation levels in 401(k) plans. While earlier studies examine similar issues, this study makes several advances. First, consistent with the theory that employers may use matching contributions to satisfy nondiscrimination rules, the study shows that correcting for the endogeneity of employer matching substantially increases the estimated effect of matching on participation levels. Second, the study provides evidence that the large positive association between employee tenure and 401(k) participation is because “stayers” tend to be “savers.”
Taxing Families Fairly

This article focuses on the historical role of state marital property law in shaping the current federal tax rules regarding taxation of the family. Now that a number of states have granted status recognition to same-sex couples and granted them marital property rights, the tension between state property law and federal tax law has produced new problems. This article identifies those problems and proposes a solution that would restore uniformity and tax all families fairly.
Issues raised by studying DeFond and Zhang: : What should audit researchers do?

We view audit-quality choice as one among many that managers make to maximize firm value. We question whether audit-quality differences among publicly traded companies are of significant interest to investors, clients, and auditors and ask for research on this topic. Relatedly, we ask for research on whether auditors and their clients show behavior consistent with regulated audit quality exceeding the audit quality level demanded absent regulation. We propose that researchers incorporate the competitive advantages of auditors and the institutional features of the audit process into the definition of audit quality. We propose that audit quality research test for externalities and inefficiencies to understand whether auditors and their clients are choosing the efficient level of audit quality. We note the legislative, judicial, and executive powers residing in the PCAOB. & 2014 Elsevier B.V. All rights reserved.
The Language Ability of U.S. Immigrants: Assimilation and Cohort Effects

This article uses data from the 1980 and 1990 U.S. Censuses of Population to examine the English language skills of natives and immigrants. It finds that lack of fluency in spoken English is rare a...
THE ETHICS OF ECONOMIC SANCTIONS

This article examines economic sanctions from an ethical perspective. Utilitarian ethics and rights theory are applied to economic sanctions in general. Special attention is paid to the economic sanctions imposed against Iraq and Cuba. The conclusion is that economic sanctions are very difficult to justify on any grounds and have negative consequences. Sanctions should not be used as a tool of international relations.
The complex links between governance and biodiversity

We argue that two problems weaken the claims of those who link corruption and the exploitation of natural resources. The first is conceptual and the second is methodological. Studies that use national-level indicators of corruption fail to note that corruption comes in many forms, at multiple levels, that may affect resource use quite differently: negatively, positively, or not at all. Without a clear causal model of the mechanism by which corruption affects resources, one should treat with caution any estimated relationship between corruption and the state of natural resources. Simple, atheoretical models linking corruption measures and natural resource use typically do not account for other important control variables pivotal to the relationship between humans and natural resources. By way of illustration of these two general concerns, we used statistical methods to demonstrate that the findings of a recent, well-known study that posits a link between corruption and decreases in forests and elephants are not robust to simple conceptual and methodological refinements. In particular, once we controlled for a few plausible anthropogenic and biophysical conditioning factors, estimated the effects in changes rather than levels so as not to confound cross-sectional and longitudinal variation, and incorporated additional observations from the same data sources, corruption levels no longer had any explanatory power.
Reducing Management’s Influence on Auditors’ Judgments: An Experimental Investigation of SOX 404 Assessments

ABSTRACT: Auditors often receive summary information or conclusions from management about account balances or internal controls. They must then gather evidence to assess whether this information is fairly stated. In such situations, management can be considered the “first mover” and the auditor the “second mover.” When auditors are the second mover, they are vulnerable to the curse of knowledge bias—the inability to ignore previously processed information (Fischhoff 1977). Specifically, because information from management could be incorrect or biased, auditors must arrive at an independent evaluation of the item in question (e.g., year-end book values, accounting estimates, or internal controls). This study examines the general issue of auditors being “second movers” by investigating how their awareness of management’s severity classifications of internal control problems influences auditors’ initial assessments of internal control over financial reporting (ICFR) under Auditing Standard No. 2. Our experim...
An empirical examination of factors driving the offshore renminbi market

ABSTRACTFollowing the 2010 establishment of the offshore renminbi market in Hong Kong, renminbi deposits there quickly rose above RMB 1 trillion. In this article, we examine fluctuations between the offshore value of the renminbi in Hong Kong and its onshore value in mainland China. The size of the spot market spread appears to be influenced by stock market sentiment as reflected in the spread between A-shares listed in Shanghai and H-shares listed in Hong Kong. There is also some evidence of a link between the spread and the pace of renminbi deposit growth in Hong Kong.