cssi/SciSciGPT-SciSciNet huggingface dataset:
Asset Revaluation Regulations

Generally accepted accounting principles (GAAP) provide a vast array of revaluation requirements, including lower of cost or market for inventory, net realizable value for receivables, a less restrictive variant of lower of cost or market for longlived assets, and fair value for a variety of financial instruments. We examine a simple model with endogenous investment in which any one of these revaluation policies can maximize welfare, depending on regulatory objectives and model parameters. Thus, standard economic considerations can produce GAAP with a wide variety of revaluation requirements. The central feature of the model is a lemons problem (Akerlof 1970) where an entrepreneur acquires an asset and then privately observes value-relevant information before the asset resale market opens. Some entrepreneurs are forced by liquidity concerns to liquidate their holdings, while others may opportunistically impersonate those who are liquidity-constrained. This potential impersonation and private valuation information together create a lemons problem in the resale market. The prospect of this lemons problem can affect investment incentives, as entrepreneurs anticipate mispricing of assets and recognize that if they ultimately become liquidityconstrained they may be unable to earn a reasonable return on their investment.1 In principle, mandated revaluation of assets (in effect, movement away from historical cost) can lead to more accurate pricing, protect distressed entrepreneurs, and enhance incentives for investment. However, revaluation regulations also can impose costs on affected entrepreneurs and can induce investment distortions. The optimal design of revaluation regulations requires a careful balancing of these benefits and costs. Our model provides three primary qualitative conclusions in a setting where risk-neutral entrepreneurs face identical stochastic investment opportunities. First, when the level of initial investment is readily observed, the revaluation policy that maximizes aggregate expected surplus imposes no revaluation requirement whatsoever. This is the case because the losses that the lemons problem imposes on distressed entrepreneurs are exactly offset by the opportunistic gains that it affords
The Value Relevance of Financial Statements in the Venture Capital Market

This study examines the value relevance of financial statement data and nonfinancial statement information within and across the pre‐IPO venture capital and post‐IPO public equity markets. For a sample of U.S. biotechnology firms, I find that financial statements are highly value‐relevant in the venture capital market, and that the signs of the associations between equity values and financial statement data in that market are similar to those in the public equity market, despite significant structural differences between the two. I also find that the value relevance of financial statements generally increases as firms mature, consistent with financial statements capturing the increasing intensity of assets‐in‐place relative to future investment options. In contrast, the value relevance of nonfinancial statement information decreases as firms mature, indicating that, in a dynamic sense, financial statements and nonfinancial statement information of venture‐backed pre‐IPO biotech companies are information s...
Optimal Policy for Software Vulnerability Disclosure

Software vulnerabilities represent a serious threat to cybersecurity, most cyberattacks exploit known vulnerabilities. Unfortunately, there is no agreed-upon policy for their disclosure. Disclosure policy (which sets a protected period given to a vendor to release the patch for the vulnerability) indirectly affects the speed and quality of the patch that a vendor develops. Thus, CERT/CC and similar bodies acting in the public interest can use disclosure to influence the behavior of vendors and reduce social cost. This paper develops a framework to analyze the optimal timing of disclosure. We formulate a model involving a social planner who sets the disclosure policy and a vendor who decides on the patch release. We show that the vendor typically releases the patch less expeditiously than is socially optimal. The social planner optimally shrinks the protected period to push the vendor to deliver the patch more quickly, and sometimes the patch release time coincides with disclosure. We extend the model to allow the proportion of users implementing patches to depend upon the quality (chosen by the vendor) of the patch. We show that a longer protected period does not always result in a better patch quality. Another extension allows for some fraction of users to use “work-arounds.” We show that the possibility of work-arounds can provide the social planner with more leverage, and hence the social planner shrinks the protected period. Interestingly, the possibility of work-arounds can sometimes increase the social cost due to the negative externalities imposed by the users who are able to use the work-arounds on the users who are not.
Voluntary Audit Committee Formation and Practices among Belgian Listed Companies

In this paper we investigate some factors that are associated with voluntary audit committee formation in a non-Anglo-Saxon environment (and where audit committee formation is voluntary, even for listed companies). For those companies that voluntarily instaled an audit committee we also present evidence on their working practices. We use data from Belgian listed companies for that purpose. Consistent with previous Anglo-Saxon research, we find that voluntary audit committee formation is positively correlated with the proportion of independent directors on the board of directors and external audit-firm size. Contrary to prior studies, we do not find that agency costs and board size are associated with voluntary audit committee formation. As to working practices, we find that a substantial amount of Belgian-listed companies do not comply with the recommendations of the Brussels Stock Exchange regarding audit committees, as about 50% of these companies has no audit committee. Those companies that do have an audit committee perform quite well according to the Belgian recommendations, but not according to recently formulated (tougher) US requirements, as they typically do not include a financial expert nor disclose the audit committee charter.
General Assistance Recipients and Welfare-To-Work Programs: Evidence from New York City

General Assistance (GA) programs are virtually unstudied. Yet, GA programs serve an economically vulnerable, non-trivial population that should be of interest. To begin to address this shortcoming, two welfare-to-work programs, in which GA recipients participated, are studied. Using a quasi-experimental approach, the effect of each program on welfare use and employment is estimated. The results indicate that each program significantly increased welfare exits and that the second program significantly increased employment (employment data was unavailable for the first program).
Law as a Healing Profession: The "Comprehensive Law Movement

This article outlines the history, context, importance, and development of ten or so "vectors" of an emerging change in the law comprising the "comprehensive law movement." This is a movement towards law as a positive force in the resolution and administration of legal matters. The vectors include: creative problem solving, therapeutic jurisprudence, preventive law, restorative justice, collaborative law, transformative mediation, and holistic justice. The movement utilizes the insights of procedural justice and other social science-based understanding of the intrapersonal and interpersonal dynamics of legal affairs and legal disputes. Developments such as problem solving courts, which include drug treatment courts, unified family courts, and mental health courts, are examples of the comprehensive law movement in application. This movement and its vectors intersect in two broad areas: first, it explicitly seeks to optimize human wellbeing in the administration of law, the resolution of legal disputes, and the resolution of legal matters, when to do so does not impinge or reduce the legal rights of the individuals involved. Second, in resolving legal matters, it explicitly considers more than strict legal rights, duties, and obligations; it includes needs, goals, values, beliefs, resources, relationships, psychological dynamics, and other nonlegal factors in its analysis of legal problems and legal solutions. The legal profession has been suffering from a "tripartite crisis" in the past two decades or so, of deprofessionalism and incivility, low public opinion of lawyers, and lawyer distress and dissatisfaction. The comprehensive law movement holds promise for infusing a set of restorative, therapeutic, collaborative, reconciliative, cooperative, and humanistic values into law practice and the administration of laws that may appeal to many lawyers and many clients. In offering an alternative to the traditional approach to law and lawyering, the comprehensive law movement may help to ameliorate some of the internal and external dissatisfaction with lawyers and the legal system.
Online Investment Education: Listening to Learners to Develop an Effective Financial Literacy Program for Farm Households.

A needs assessment was conducted for the adaptation of an existing online Cooperative Extension investment course for use by farm households. The theoretical model was Social Marketing Theory. Data about financial attitudes, practices, and learning preferences of farm households were collected through a telephone survey of 300 farm households and two focus groups. Quantitative and qualitative data confirmed that farmers prefer investing in land and farm-related assets instead of securities. Further, an increasing number of farm family members engaged in paid employment, which provided access to employee benefits. Many farmers did not plan to retire in later life but indicated a desire to scale back their work hours and/or reduce the size of their farm business. Women in the sample were more engaged with the Internet than men and less likely to dislike using computers.
Determinants of returns and volatility of Chinese ADRs at NYSE

Abstract This paper examines the determinants of returns and of volatility of the Chinese ADRs as listed at NYSE. Using an autoregressive conditional heteroskedasticity (ARCH) model and data from 16 April 1998 through 30 September 2004, we find that Hong Kong stock market (underlying market), US stock market (host market), and local (Shanghai A and B) markets all are important determinants of returns of the Chinese ADRs. However, the underlying Hong Kong market has the most significant impact on mean returns of the ADRs. In terms of the determinants of the conditional volatility of the ADRs returns, only shocks to the underlying markets are significant. These results are consistent with [Kim, M., Szakmary, A.C., Mathur, I., 2000. Price transmission dynamics between ADRs and their underlying foreign securities. Journal of Banking and Finance 24, 1359–1382] who find that the most influential factor in pricing the ADRs in Japan, UK, Sweden, The Netherlands and Australia is their underlying shares. Implications of the results for investors are discussed.
European unemployment: the evolution of facts and ideas

In the 1970s, European unemployment started increasing. It increased further in the 1980s, to reach a plateau in the 1990s. It is still high today, although the average unemployment rate hides a high degree of heterogeneity across countries. The focus of researchers and policy makers was initially on the role of shocks. As unemployment remained high, the focus has progressively shifted to institutions. This paper reviews the interaction of facts and theories, and gives a tentative assessment of what we know and what we still do not know. — Olivier Blanchard
Estimating Average Treatment Effects Utilizing Fractional Imputation when Confounders are Subject to Missingness

The problem of missingness in observational data is ubiquitous. When the confounders are missing at random, multiple imputation is commonly used; however, the method requires congeniality conditions for valid inferences, which may not be satisfied when estimating average causal treatment effects. Alternatively, fractional imputation, proposed by Kim 2011, has been implemented to handling missing values in regression context. In this article, we develop fractional imputation methods for estimating the average treatment effects with confounders missing at random. We show that the fractional imputation estimator of the average treatment effect is asymptotically normal, which permits a consistent variance estimate. Via simulation study, we compare fractional imputation’s accuracy and precision with that of multiple imputation.
Education and Tech Entrepreneurship

The popular image of American tech entrepreneurs is that they come from elite universities: Some graduate and start companies in their garages; others drop out of college to start their business careers. The dot-com boom reinforced the image of technology CEOs being young and brash. But, even though Bill Gates and Steve Jobs founded two of the world's most successful companies, they are not representative of technology and engineering company founders. Indeed, a larger proportion of tech founders are middle-aged, well-educated in business or technical disciplines, with degrees from a wide assortment of schools. Twice as many U.S.-born tech entrepreneurs start ventures in their fifties as do those in their early twenties, as this paper will show.We surveyed 652 U.S.-born chief executive officers and heads of product development in 502 engineering and technology companies established from 1995 through 2005. These companies, identified from an existing dataset of corporate records in Dun & Bradstreet's Million Dollar Database, have more than $1 million in sales, twenty or more employees, and company branches with fifty or more employees.We observed that, like immigrant tech founders, U.S.-born engineering and technology company founders tend to be well-educated. There are, however, significant differences in the types of degrees these entrepreneurs obtain and the time they take to start a company after they graduate. They also tend to be more mobile and are much older than is commonly believed.
Libertarianism, Law and Economics, and the Common Law

Libertarian legal theory has long had admiration for, but also distrust of, the common law and law and economics. This distrust is partly methodological. Libertarian legal theory has traditionally been deontological and normatively-oriented, typically grounded in natural rights theory and reasoning to normative statements about the content of the law. Law and economics, by contrast, purports to be a positive theory of the common law foremost, while providing a normative justification for the common law as well (namely, social wealth maximization as a normative value). Indeed, it is this primarily positive thrust of law and economics that accounts to a large extent for its influence on legal thinking, while its normative arguments have been much more heavily contested.
Manning the Courthouse Gates: Pleadings, Jurisdiction and the Nation-State

While civil procedure reforms are often said to be based on concerns of efficiency and economy, This article argues that civil justice reforms are also part of any nation’s project of national identity and state building. A robust civil justice system is a statement of national progress and reforms to the system are less a reflection of a “civil justice crisis,” and more a result of political bartering and debates about a nation’s identity. This can be seen in European countries’ recent efforts to coordinate procedural systems even as they are called to define themselves as member states of the European Union. As this article will document, this is similarly true in China and in the United States, where civil procedure reforms have matched critical stages of state building and national expansion. But interestingly, this article concludes that despite the different polity of the two countries, recent changes in civil procedures may be similarly counter- productive to the raison d’etre of the procedures sought to be reformed, rather than supportive of their ideals. The effect of these changes, in the case of the United States can be counter-democratic, and in China, counter-harmonious.
One Size Fits All? Specialization, Trade and Income Inequality

Previous research has uncovered precious little support for Heckscher-Ohlin trade theory. This paper demonstrates that those efforts focus on an overly restrictive version of the model. Indeed, strong evidence that output is a function of endowments can be found if we recognize that countries with sufficiently disparate endowments specialize in different subsets of goods. This paper develops a technique for differentiating specialization from an equilibrium in which all countries produce the same goods. It also demonstrates that the industry aggregates used in previous studies hide a substantial degree of cross-country price and input intensity heterogeneity, violating the assumptions of the model and rendering previous results difficult to interpret. When traditional aggregates are corrected to account for this heterogeneity, support for specialization increases. Finally, this paper contributes to the current debate on trade and wages by illustrating that in 1990 the US was sufficiently capital abundant to have an output mix distinct from that of by low wage, labor abundant countries. This specialization mitigates the ability of cheap imports to adversely affect US workers, casting doubt on the argument that international trade is raising US income inequality.
Pondering the Politics of Private Procedures: The Case of ICANN

The creation of ICANN was sought by the United States government to promote international cooperation in the governance of the Internet based on a bottom-up system in which government intervention was limited, if not eliminated. However, as the Internet has become a global phenomenon, this initiative has faced increasing opposition from the international community. As we have shown in this article, the evolution of ICANN reveals how it slowly departed from its mere technical role into a more political one, in which all groups and constituencies try to impose their preferences. During the reform movement initiated from inside ICANN, different constituencies tried to exploit the situation by gaining power positions in the new structure. The political strength of different groups and constituencies reversed some of the initial reforms and produced a totally new structure. Reform attempts from inside ICANN were challenged by the international community. These efforts concentrated on changing the main structure of ICANN into a multilateral organization controlled by international governments and removing the direct control of ICANN from the United States government. In the end, even though the proposals seem to look for different structures to regulate domain names and numbers on the Internet, they represent a political struggle between opposite points of view.
Ronald Reagan and the Rehnquist Court on Congressional Power: Presidential Influences on Constitutional Change

This article was published as part of a symposium on "Congressional Power in the Shadow of the Rehnquist Court." It reviews recent Rehnquist Court decisions that limit congressional power - including through limits on Congress's section 5 and commerce powers as well as state sovereign immunity and "anti-commandeering" doctrine - and traces them to a concerted effort on the part of ideological conservatives to change the direction of constitutional law. The article focuses on a little-known series of lengthy reports issued by the U.S. Department of Justice, under the direction of President Reagan's Attorney General Ed Meese, that developed a detailed and comprehensive constitutional vision on all the great issues of the day - the right to privacy, affirmative action, religion, and many other issues in addition to congressional power and federalism - a vision, moreover, often at odds with Supreme Court precedent. The reports also addressed strategies for implementing the Reagan/Meese vision, including a call for the appointment of ideologically sympathetic judges. The article considers the Reagan/Meese effort as an example of the central role the political branches, and more generally non-judicial forces, play in promoting constitutional change.
Trial by mathematics—reconsidered

In 1970, Michael O. Finkelstein (with William B. Fairley) proposed that under some circumstances a jury in a criminal trial might be invited to use Bayes' Theorem to address the issue of the identity of the criminal perpetrator. In 1971, Laurence Tribe responded with a rhetorically powerful and wide-ranging attack on what he called 'trial by mathematics'. Finkelstein responded to Tribe's attack by further explaining, refining and defending his proposal. Although Tribe soon fell silent on the use of mathematical and formal methods to dissect or regulate uncertain factual proof in legal proceedings, the Finkelstein-Tribe exchange precipitated a decades-long debate about trial by mathematics. But that debate, which continues to this day, became generally unproductive and sterile years ago. This happened in part because two misunderstandings plagued much of the debate almost from the start. The first misunderstanding was a widespread failure to appreciate that mathematics is part of a broader family of rigorous methods of reasoning, a family of methods that is often called 'formal'. The second misunderstanding was a widespread failure to appreciate that mathematical and formal analyses (including analyses that use numbers) can have a large variety of purposes. Before any further major research project on trial by mathematics is begun, interested researchers in mathematics, probability, logic and related fields, on the one hand, and interested legal professionals, on the other hand, should try to reach agreement about the possible distinct purposes that any given mathematical or formal analysis of inconclusive argument about uncertain factual hypotheses might serve. The article lists some of those possible purposes. Language: en
Systemic Risk in the Insurance Sector: A Review of Current Assessment Approaches

The following article reviews the recent regulatory efforts in defining systemic risk in the insurance sector and the designation of systemically important insurers. Although current evidence suggests that core insurance activities are unlikely to cause or propagate systemic risk, the characteristics and business models of insurance firms vary by country and might require a more nuanced examination, with a particular focus on non-traditional and/or non-insurance activities. The article also includes the assessment of identified vulnerabilities from liquidity risk in the context of the Bermuda market, which provides valuable insights into systemic risk analysis in the domestic context of an insurance market dominated by non-life underwriting.
Empirical cross-sectional asset pricing

I review recent research efforts in the area of empirical cross-sectional asset pricing. I start by summarizing the evidence on cross-sectional return predictability and the failure of standard (consumption) capital asset pricing models (CAPMs) and their conditional versions to explain these predictability patterns. Part of the recent literature focuses on ad hoc factor models, which summarize the cross section of expected returns in parsimonious form, or on production-based approaches, which suggest links between firm characteristics and expected returns. Without imposing restrictions on investor preferences and beliefs, neither one of these two approaches can answer the question of why investors price assets the way they do. Within the rational expectations paradigm, recent research that imposes such restrictions has focused on the intertemporal CAPM (ICAPM), long-run risks models, as well as frictions and liquidity risk. Approaches based on investor sentiment have focused on the development of empirica...
Robo2 Drives Target Selective Peripheral Nerve Regeneration in Response to Glia Derived Signals

Peripheral nerves are divided into multiple branches leading to divergent synaptic targets. This poses a remarkable challenge for regenerating axons as they select their original trajectory at nerve branch-points. Despite implications for functional regeneration, the molecular mechanisms underlying target selectivity are not well characterized. Zebrafish motor nerves are composed of a ventral and a dorsal branch that diverge at a choice point, and we have previously shown that regenerating axons faithfully select their original branch and targets. Here we identify Robo2 as a key regulator of target selective regeneration. We demonstrate that Robo2 function in regenerating axons is required and sufficient to drive target selective regeneration, and that Robo2 acts in response to glia located precisely where regenerating axons select the branch-specific trajectory to prevent and correct axonal errors. Combined our results reveal a glia derived mechanism that acts locally via axonal Robo2 to promote target selective regeneration.
Analyzing the Amazon Mechanical Turk marketplace

An associate professor at New York Universitys Stern School of Business uncovers answers about who are the employers in paid crowdsourcing, what tasks they post, and how much they pay.
Textual paralanguage and its implications for marketing communications

Abstract Both face-to-face communication and communication in online environments convey information beyond the actual verbal message. In a traditional face-to-face conversation, paralanguage, or the ancillary meaning- and emotion-laden aspects of speech that are not actual verbal prose, gives contextual information that allows interactors to more appropriately understand the message being conveyed. In this paper, we conceptualize textual paralanguage (TPL), which we define as written manifestations of nonverbal audible, tactile, and visual elements that supplement or replace written language and that can be expressed through words, symbols, images, punctuation, demarcations, or any combination of these elements. We develop a typology of textual paralanguage using data from Twitter, Facebook, and Instagram. We present a conceptual framework of antecedents and consequences of brands' use of textual paralanguage. Implications for theory and practice are discussed.
Board connections and M&A transactions

Abstract We examine M&A transactions between firms with current board connections and find that acquirers obtain higher announcement returns in transactions with a first-degree connection where the acquirer and the target share a common director. Acquirer returns are also higher in transactions with a second-degree connection where one acquirer director and one target director serve on the same third board. Our results suggest that first-degree connections benefit acquirers with lower takeover premiums while second-degree connections benefit acquirers with greater value creation. Overall, we provide new evidence that board connectedness plays important roles in corporate investments and leads to greater value creation.
Foucault as a kind of realist: genealogical critique and the debunking of the human sciences

Foucault’s corpus is animated by an ethical or political impulse: to liberate individuals from a kind of oppression, one which does not involve the familiar tyranny of the totalitarian state but ex...
Networks and productivity: Causal evidence from editor rotations

Abstract Using detailed publication and citation data for over 50,000 articles from 30 major economics and finance journals, we investigate whether network proximity to an editor influences research productivity. During an editor's tenure, his current university colleagues publish about 100% more papers in the editor's journal, compared to years when he is not editor. In contrast to editorial nepotism, such “inside” articles have significantly higher ex post citation counts, even when same-journal and self-cites are excluded. Our results thus suggest that despite potential conflicts of interest faced by editors, personal associations are used to improve selection decisions.
The American Commercial Religion

To all but possibly the most senior of commercial law specialists, it is difficult to imagine American commercial life without the nationwide adoption of the Uniform Commercial Code. We would surely regard as impossible the idea that the vast economic success of the latter half of the twentieth century could have been achieved without it. The Uniform Commercial Code is our godhead, our sacred foundational document, our Holy Book of modern commerce, which brought us a form of economic enlightenment from the pre-Code Days of Ignorance. Our attachment to the U.C.C. runs far deeper than a mere rational commercial preference. It resembles more that of the faith of the religious believer. This presents a problem, however. Even if we assume that our faith in the U.C.C. has been over the past several decades salutary, and there are good and plenty reasons to believe that it is, and even if the uniformity that is its product has on balance permitted massive economic progress, our near dogmatic faith-like belief in the U.C.C., our Code, has hindered the very type of global uniformity, and the attendant benefits thereto, that it continues to enable in the domestic context. The Article will demonstrate this by focusing on two areas of attempted global convergence in commerce where cross border harmonization of domestic regimes has proved particularly problematic, albeit in different ways in each case. These areas correspond to the respective scope of two of the more hallowed Articles of the Code; namely, Article 2, which deals with the sale of goods, and Article 9, which deals with means to obtain security over debt. This Article also discusses what must be done if meaningful international harmonization is to be achieved.
Bibliometrics for Internet Media: Applying the h-Index to YouTube

The h-index can be a useful metric for evaluating a person's output of Internet media. Here I advocate and demonstrate adaption of the h-index and the g-index to the top video content creators on YouTube. The h-index for Internet video media is based on videos and their view counts. The h-index is defined as the number of videos with ≥h × 105 views. The g-index is defined as the number of videos with ≥g × 105 views on average. When compared with a video creator's total view count, the h-index and g-index better capture both productivity and impact in a single metric.
Social Capital in Urban China: Attitudinal and Behavioral Effects on Grassroots Self‐Government*

Objectives. Studies of Western settings, in general, argue that social capital, defined as a set of civic norms and social networks among ordinary citizens, nurtures democratic governance at various levels. Does such a social capital exist in a transitional society such as China? If so, what kind of role does social capital play in affecting individuals’ attitudinal and behavioral orientations toward fledging grassroots self-government in that society? This study is intended to answer these questions, which are crucial for our understanding of China’s sociopolitical development as well as for the application of social capital theories in non-Western societies. Methods. This study is based on the data collected from a representative survey conducted in an urban area in China in 2004. Results. The findings from this study indicate that social capital among urban residents was abundant, and it nurtured the grassroots self-government system through residents’ attitudinal and behavioral orientations toward the system. Conclusions. These findings have strong implications for the future of local democratic governance and applicability of social capital theories in China.
Non-contractible investments and vertical integration in the Mexican footwear industry

Abstract This paper examines patterns of integration among manufacturers and retailers, using data from a survey of footwear manufacturers in Mexico. The property rights framework, developed in papers by Grossman and Hart [1986, J. Polit. Econ. 94: 691] and Hart and Moore [1990, J. Polit. Econ. 98: 1119], is differentiated from the standard empirical transactions cost framework. In the context of this industry, the most relevant distinction between the two frameworks is that the property rights framework addresses both the benefits and costs of integration, while the transactions cost framework focuses only on variation in the benefits of integration. We show that the costs of integration are highest where the retailer’s non-contractible investment has an important effect on the overall profits from the relationship. Consistent with the property rights framework, the data suggest that integration is less likely in these circumstances.
The Puzzle of Short-termism

When pondering the question of the “sustainable corporation,” as we did in this symposium, one of the intractable problems is the nature of the corporation to produce externalities. By noting this characteristic, I am not making a moral point but an economic one. The nature of the firm is to create financial wealth by producing goods and services for profit; without regulatory or contractual limits, the firm has every incentive to externalize costs onto those whose interests are not included in the firm’s current financial calculus. In fact, because of the corporation’s tendency to create benefits for itself by pushing costs onto others, the corporation could aptly be called an “externality machine.”1 The obvious kind of externality is the one that happens in the same time frame as the benefits gained. These current externalities take a number of forms. A company might refuse to provide health benefits to its employees, leaving Medicare or Medicaid to pick up the tab.2 The company might save on production costs by skirting environmental laws, thereby forcing communities, neighbors, or employees to suffer risks of harm that do not need to be accounted for on the company’s financial statements.3 Alternatively, the
Ubi Jus, Ibi Remedium: The Fundamental Right to a Remedy

This essay is part of the 2003 Remedies Forum symposium comprised of international remedies scholars addressing the topic of equitable relief in the fifty years since Brown v. Board of Education. It may be true that since the time of Brown, institutional defendants have won at the expense of plaintiffs. Defendants have learned that delay and defiance work. The U.S. Supreme Court has adopted a standard for ordering equitable relief that significantly defers to defendant wrongdoers at the plaintiffs' expense. Epithets of "activist courts" and "judicial legislation" have colored the existing scholarship and portrayed remedial action as illegitimate and excessive judicial power. And the recent barrage of school funding cases demonstrate the same resistance to court-ordered conduct as seen in Brown. This essay attempts to swing the pendulum in the other direction by suggesting that remedial action like that of Brown and its progeny is not only acceptable, but indeed, required judicial action. It argues that a remedy is more than a legal maxim. Rather, this essay argues that the right to a meaningful remedy is a fundamental right protected by the Due Process Clause of the Fourteenth Amendment. Stated simply: Ubi jus, ibi remedium. Where there's a right, there must be a remedy. The article traces the history of the remedy as a fundamental concept of our ordered liberty from Blackstone to the Federalists to Marbury v. Madison. It argues not only that the right to a remedy has been recognized historically as a fundamental right, but that it should appropriately be considered a fundamental interest under the law. Remedies perform two critical functions in the law: they define abstract rights and enforce otherwise intangible rights. Rights standing alone are simply expressions of social values. It is the remedy that defines the right by making the value real and tangible by providing specificity and concreteness to otherwise abstract guarantees. Relying upon U.S. Supreme Court precedent in cases involving punitive damages and tax remedies, the essay argues that the Court has implicitly recognized the minimum right to a meaningful remedy.
Economic policies on Slovenia's road to the euro area

On 1 January 2007, Slovenia was the first new EU member state to enter the euro area. Since June 2004, the Slovenian tolar participated in the exchange rate mechanism ERM-II with a central parity of 239.64 against the euro. This parity was also the conversion rate upon euro area accession. Applying a macroeconometric model of Slovenia, this paper analyses the macroeconomic effects of different conversion rates. These simulations are compared to a scenario with flexible exchange rates. The best results are obtained with the actual conversion rate. In addition, it is shown that the labour market performance can be significantly improved by cutting non-wage labour costs.
A note on the perverse effects of actively open-minded thinking on climate-change polarization

This research note presents evidence that political polarization over the reality of human-caused climate change increases in tandem with individuals’ scores on a standard measure of actively open-minded thinking. This finding is at odds with the position that attributes political conflict over facts to a personality trait of closed-mindedness associated with political conservatism.
Household demand for broadband internet service

As part of the Federal Communications Commission (“FCC”) National Broadband Report to Congress, we have been asked to conduct a survey to help determine consumer valuations of different aspects of broadband Internet service. Our empirical results show that reliability and speed are important characteristics of Internet service. The representative household is willing to pay about $20 per month for more reliable service and $45-48 for an increase in speed. Willingness-to-pay for speed increases with education, income and online experience, and decreases with age. Rural households value connection speed by about $3 more per month than urban households. Households are also willing to pay an additional $4 for the ability to interact with health specialists online, about $3 for the ability to download full-length movies, and about $5 for the ability to place free phone calls over the Internet and see the person being called. Using these results, we calculate that a representative household would be willing to pay about $59 per month for a less reliable Internet service with fast speed, about $85 for a reliable Internet service with fast speed and the priority feature, and about $98 for a reliable Internet service with fast speed plus all other activities.
Spatial dynamic panel data models with random effects

Abstract We develop a general space–time filter applied to panel data models in order to control for heterogeneity as well as both time and spatial dependence. Treatment of initial period observations is analyzed when the number of time periods is small. A second issue relates to a restriction implied by the filter specification on the space–time cross-product term that can greatly simplify interpretation of model estimates as well as the estimation procedure. An applied illustration of the method is provided using a Solow growth model. The application shows that the theoretical restriction implied for the cross-product term in our space–time filter specification is consistent with this particular dynamic space–time panel data set.
Liquidity, resiliency and market quality around predictable trades: Theory and evidence.

Abstract We extend the theory of strategic trading around a predictable liquidation by considering the role of market resiliency. Our model predicts that even a monopolist strategic trader improves market quality and increases liquidator proceeds if trades’ temporary price impacts are quickly reversed, and that competition among strategic traders strictly improves market quality. We provide related empirical evidence by studying prices, liquidity, and individual account trading activity around the large and predictable “roll” trades undertaken by a large exchange-traded fund (ETF). The evidence indicates narrower bid-ask spreads, greater order book depth, and improved resiliency on roll dates. We find that a larger number of individual trading accounts provide liquidity on roll dates, and do not find evidence of the systematic use of predatory strategies. On balance, the theory and evidence imply that traders supply liquidity to rather than exploit predictable trades in resilient markets.
Originalism and the Natural Born Citizen Clause

The enigmatic phrase "natural born citizen" poses a series of problems for contemporary originalism. New Originalists, like Justice Scalia, focus on the public meaning of the constitutional text, but the notion of a "natural born citizen" was likely a term of art, derived from the idea of a "natural born subject" in English law - a category that most likely did not extend to persons, like John McCain, who were born outside sovereign territory. But the constitution speaks of "citizens" and not "subjects," introducing uncertainties and ambiguities that might (or might not) make McCain eligible for the presidency.What was the original public meaning of the enigmatic phrase that establishes the eligibility for the office of President of the United States? There is general agreement on the core of settled meaning: some cases of inclusion and exclusion seem indisputable. As a matter of inclusion, anyone born on American soil with an American parent is clearly a "natural born citizen." As a matter of exclusion, anyone whose citizenship is acquired after birth as a result of "naturalization" is clearly not a "natural born citizen." But these clear cases of inclusion and exclusion do not exhaust the possibilities. John McCain's citizenship was conferred by statute - perhaps before, but perhaps after his birth. That leaves John McCain in a twilight zone - neither clearly naturalized nor natural born.This Essay explores the contribution of originalism as a theory of constitutional interpretation to the controversy over the meaning of the natural born citizenship clause. Part II of the Essay explains the relevance of originalist constitutional theory to the controversy with special reference to the New Originalism - the view of constitutional meaning that emphasizes public meaning of the constitutional text at the time each provision was framed and ratified. Part III argues that that the clause creates a problem for public meaning originalism - the phrase "natural born citizen" may not have had a widely shared public meaning in the late eighteenth century; the solution to this problem could be the notion of a "term of art," in particular, the idea that the meaning of "natural born citizen" derives from the English concept of a "natural born subject." Part IV considers the possibility that the original meaning of the natural born citizen clause is subject to an irreducible ambiguity. Part V concludes with reflections on the exemplary significance of the natural born citizen clause for constitutional theory.
Do stock splits signal future profitability

This study examines whether stock split announcements contain information content about future profitability, measured in terms of future earnings change, future earnings, or future abnormal earnings. We find that the split announcement year has the highest earnings change and the earnings change declines substantially over the subsequent five years. Our empirical results show little evidence that stock splits are positively related to future profitability. In fact, stock splits are in general negatively related to future profitability in subsequent years after the announcement, except for dividend-paying firms with a split factor less than 0.5. This negative relation holds regardless of future profitability measure. Therefore, our empirical finding suggests that stock splits are not useful signals of a firm’s future earnings prospects.
THE IMPACT OF COLLUSION ON PRICE BEHAVIOR: EMPIRICAL RESULTS FROM TWO RECENT CASES

Abstract We use extended ARCH and GARCH models to examine the differences in the behavior of the first two moments of the price distribution during collusive and competitive phases of two recently discovered conspiracies, citric acid and lysine. According to our results, the conspirators managed to raise prices by 9 and 25 cents per pound in the short-run relative to non-collusive periods. Also, the variance of prices during the lysine conspiracy was lower and the variance of prices during the citric acid conspiracy was higher than during more competitive periods. The proposed methodology may be used for antitrust screening and prosecution purposes.
An Econometric Model of Serial Correlation and Illiquidity In Hedge Fund Returns

The returns to hedge funds and other alternative investments are often highly serially correlated, in sharp contrast to the returns of more traditional investment vehicles such as long-only equity portfolios and mutual funds. In this paper, we explore several sources of such serial correlation and show that the most likely explanation is illiquidity exposure, i.e., investments in securities that are not actively traded and for which market prices are not always readily available. For portfolios of illiquid securities, reported returns will tend to be smoother than true economic returns, which will understate volatility and increase risk-adjusted performance measures such as the Sharpe ratio. We propose an econometric model of illiquidity exposure and develop estimators for the smoothing prole as well as a smoothing-adjusted Sharpe ratio. For a sample of 908 hedge funds drawn from the TASS database, we show that our estimated smoothing coecien ts vary considerably across hedge-fund style categories and may be a useful proxy for quantifying illiquidity exposure.
Minimum distance from independence estimation of nonseparable instrumental variables models

Abstract I develop a semiparametric minimum distance from independence estimator for a nonseparable instrumental variables model. An independence condition identifies the model for many types of discrete and continuous instruments. The estimator is taken as the parameter value that most closely satisfies this independence condition. Implementing the estimator requires a quantile regression of the endogenous variables on the instrument, so the procedure is two-step, with a finite or infinite-dimensional nuisance parameter in the first step. I prove consistency and establish asymptotic normality for a parametric, but flexibly nonlinear outcome equation. The consistency of the nonparametric bootstrap is also shown. I illustrate the use of the estimator by estimating the returns to schooling using data from the 1979 National Longitudinal Survey.
The Culture of Under-Enforcement: Buried Treasure, Sarbanes-Oxley and the Corporate Pirate

In its effort to combat rising lawlessness in decades past, Congress enacted enhanced criminal penalties that included not only increased prison sentences and fines, but also asset forfeiture provisions. Asset forfeiture reaches the spoils of the wrongdoer's illegal conduct, and strikes at the heart of the criminal's economic motive for misusing his corporate status. The failure to include this additional penalty in the Sarbanes-Oxley Act's criminal measures effectively allows the corporate fraudster to escape exposure to a tried and true method of punishment. This article re-introduces the white-collar criminal and highlights the government's responses to previous instances of wrongdoing by way of background in Part I. The Act's resulting criminal measures are analyzed in Parts III and IV of the article. Part V examines the proposed asset forfeiture sanction, while Part VI makes the case for the application of the asset forfeiture sanction to these particular white collar criminals. Finally, in Part VII, I explain how asset forfeiture can be obtained should Congress fail to enact specific forfeiture legislation directed towards the newly-enacted securities fraud crime.