cssi/SciSciGPT-SciSciNet huggingface dataset:
Insider versus outsider CEOs, executive compensation, and accounting manipulation☆

Abstract This paper examines the role of the financial reporting environment in selecting a new CEO from within versus outside the organization. Weak reporting controls allow the CEO to misreport performance information, which reduces the board's ability to detect and replace poorly-performing CEOs as well as aggravates incentive contracting. We show that these adverse effects are stronger when the CEO is an outsider rather than an insider. Our model predicts that boards are more likely to recruit a CEO from the outside when the performance measures with which the new hire is assessed are harder to manipulate.
Equity by the Numbers: Measuring Poverty, Inequality, and Injustice

Can we measure inequity? A naive response denies the possibility of quantification. And yet scholarly and popular discourse abounds with numbers purporting to measure inequality, poverty, and other aspects of equity. A more sophisticated answer acknowledges the wide use of equity metrics, but stresses their plurality. ―How to quantify unfairness is a value choice. Different numbers mirror different takes‘ on the meaning of equity. End of story.‖
Geographical Segmentation of US Capital Markets

Abstract Demographic variation in savings behavior can be exploited to provide evidence on segmentation in US bank loan markets. Cities with a large fraction of seniors have higher volumes of bank deposits. Since many banks rely heavily on deposit financing, this affects local loan supply and economic activity. I show a positive effect of local deposit supply on local outcomes, including the number of firms, the number of manufacturing firms, and the number of new firms started. The effect is stronger in industries that are heavily dependent on external finance. The deregulation of intrastate branching reduced the effect of local deposit supply by approximately a third.
Does sorry work? The impact of apology laws on medical malpractice

Physicians’ apologies for adverse medical events are acknowledged as a factor in patients’ decisions to litigate. Apology laws which render physicians’ apologies inadmissible in court are written to encourage patient-physician communication and to overcome the physicians’ disinclination to apologize because apologies could invite lawsuits. We present a novel model of apologies and malpractice in order to examine whether state-level apology laws have an impact on malpractice lawsuits and settlements. Using a difference-in-differences estimation, we find that apology laws could expedite the resolution process. We also find that apology laws result in the greatest reduction in average payment size and settlement time in cases involving severe patient outcomes.
Arbitration, the law market, and the law of lawyering

Abstract This paper builds on Larry Ribstein's path-breaking work concerning the role of lawyers and bar associations in jurisdictional competition and law production. According to Ribstein, unauthorized practice of law (UPL) rules, which create barriers to entry preventing out-of-state attorney and other professionals from providing services, can actually encourage the development of higher quality legal rules in a state. Ribstein's work also focused on the role of contractual choice clauses in promoting jurisdictional competition for substantive and procedural legal rules. This paper builds on his insights by incorporating the increasingly important role of arbitration into Ribstein's framework and testing empirically for possible effects of jurisdictional competition for arbitration business. We also consider and empirically test for the potential effects of jurisdictional competition on the production of law, including special rules exempting arbitration from ordinary UPL rules and state laws concerning arbitration. Our findings suggest that the adoption of a liberal UPL rule may have a significant effect on attracting legal business, but most other legal changes do not. Moreover, our findings also suggest that some (although not all) of these legal reforms are enacted as coordinated packages, validating Ribstein's insights about the political economy of law production. Finally, our findings suggest that lawyers in many states are finding ways to cleverly respond to international competitive pressures while simultaneously insulating domestic dispute resolution from similar forces, a dynamic not explored in Ribstein's work, and the Supreme Court's strong preemptive stance toward the Federal Arbitration Act may be fueling this segregation.
Incentives to Create Under a "Lifetime-Plus-Years" Copyright Duration: Lessons from a Behavioral Economic Analysis for Eldred v. Ashcroft

In this Article, we highlight for the first time some of the significant but hitherto unrecognized behavioral effects of copyright law on individuals' incentives to create and then examine the implications of our findings for the constitutional analysis of Eldred v. Ashcroft We show that behavioral biases-namely, individuals' optimistic bias regarding their future longevity and their subadditive judgments in circumstances resembling the extant rule of copyright duration-explain the otherwise puzzling lifetime-plus-years basis * Lecturer on Law, Boston University School of Law; John M. Olin Fellow in Law, Economics, and Business, Harvard Law School; Fellow, The Program on Negotiation at Harvard Law School. LL.B. and B.A., The Hebrew University of Jerusalem; LL.M. Harvard Law School. ** S.J.D. Candidate, Harvard Law School; John M. Olin Fellow in Law, Economics, and Business, Harvard Law School; Fellow, Berkman Center for Internet & Society at Harvard Law School. LL.B. and B.A., Tel Aviv University School of Law; LL.M., Harvard Law School. This Article benefited from comments and criticisms by Ward Farnsworth, Steve Garcia, Daniel Ho, and Christine Jolls. Joe Nuccio provided helpful research assistance. The first author also wishes to thank Wendy Gordon for encouraging him to make this foray into copyright law, and George Loewenstein and David Laibson for sharing their wisdom on intertemporal choice. The authors are grateful for the support of the John M. Olin Center for Law, Economics, and Business at Harvard Law School to both authors, the support of the Program on Negotiation at Harvard Law School to the first author, and the support of the Berkman Center for Internet & Society to the second author. The opinions expressed in this Article are the authors' own. LOYOLA OF LOS ANGELES LAW REVIEW [Vol. 36:437 for copyright protection given to individual authors, and reveal how this regime provides superior incentives to create. Thus, insofar as the provision of increased incentives to individual authors is socially desirable, a lifetime-plus-years rule is a more effective legal means of accomplishing this goal than a rule based on a fixed term of years of a comparable expected duration. We also find, however, that the behavioral efficacy of a lifetimeplus-years regime does not apply to the Copyright Term Extension Act (CTEA), which merely extends the "years" component of an already existing lifetime-plus-years rule. Drawing on empirical findings on intertemporal choice, as well as our preceding analysis of the lifetime-plus-years regime and our own experimental tests, we determine that the CTEA's prospective extension provides negligible additional incentives to individual authors. We conclude the extension is unjustified on incentive-provision grounds, a finding of relevance to the Court's determination in Eldred v. Ashcroft of the constitutionality of the CTEA under the Copyright Clause.
Volatility Spreads and Expected Stock Returns

This paper investigates whether realized and implied volatilities of individual stocks can predict the cross-sectional variation in expected returns. Although the levels of volatilities from the physical and risk-neutral distributions cannot predict future returns, there is a significant relation between volatility spreads and expected stock returns. Portfolio level analyses and firm-level cross-sectional regressions indicate a negative and significant relation between expected returns and the realized-implied volatility spread that can be viewed as a proxy for volatility risk. The results also provide evidence for a significantly positive link between expected returns and the call-put options' implied volatility spread that can be considered as a proxy for jump risk. The parameter estimates from the VAR-bivariate-GARCH model indicate significant information flow from individual equity options to individual stocks, implying informed trading in options by investors with private information.
Public Deliberation as the Organizing Principle of Political Communication Research

During the past fifteen years, public deliberation has become an important focus of research, theory, and public practice. This has sometimes led to a variety of narrow conceptualizations that limit deliberation to particular forms of interaction, such as small group discussion, or to divergent conceptualizations deployed in different contexts, such as for media systems versus face-to-face discussions. To address this problem, we advance a flexible yet precise definition of deliberation that has the power to organize not only deliberation theory and research but also much of the larger body of work in political communication. As defined herein, deliberation includes both analytic and social processes and provides a unifying conceptual and critical framework for studying nearly the full range of political communication topics, including informal conversation, media and public opinion, elections, government institutional behavior, jury decision making, public meetings, and civic and community life. Using our flexible conceptualization, each of these research contexts amounts to a kind of deliberative critique and empirical analysis of public life.
Restructuring the Russian electricity sector: Re-creating California?

Abstract The Russian Federation has begun restructuring its electricity sector, following the standard restructuring model of complete vertical separation of generation from transmission, with the aim of creating competition in regional generation markets. This paper examines the structure of the six principal regional generation markets that are in their early stages of development and argues that they are likely to be characterized by high levels of market power on the part of individual privatized generation companies, especially during the peak winter demand season. These levels—considerably higher than those that caused competitive problems in California—seem to create a serious risk of price spikes in deregulated wholesale electricity markets, and thus of significant price increases to consumers of electricity.
Framing Address: A Framework for Analyzing Financial Market Transformation

The title of this Symposium originally was “Rethinking Financial and Securities Markets.” It is, of course, somewhat presumptuous for scholars to try to rethink financial markets per se. Markets, including financial markets, are driven primarily by supply and demand. But scholars can and should try to influence the future of financial markets by rethinking their fundamental aspects. This Symposium presents work from leading scholars in the fields of law, economics, finance, and accounting. I will try to frame the discussion from the perspectives of these four disciplines. First, however, we need to identify what it is about financial markets that is worth rethinking. I will focus on ways in which financial markets have been changing. They are increasingly decentralized and fragmented. They are increasingly direct sources of firm capital—a process called disintermediation. They are increasingly global. They are increasingly creating funding mismatches, as short-term securities are used to finance long-term capital needs. And they (as well as financial market products) are increasingly complex and obscure to market participants, even with full disclosure. I will refer to these “financial market changes” throughout my talk.
Matching on the Estimated Propensity Score

Propensity score matching estimators (Rosenbaum and Rubin (1983)) are widely used in evaluation research to estimate average treatment effects. In this article, we derive the large sample distribution of propensity score matching estimators. Our derivations take into account that the propensity score is itself estimated in a first step, prior to matching. We prove that first step estimation of the propensity score affects the large sample distribution of propensity score matching estimators, and derive adjustments to the large sample variances of propensity score matching estimators of the average treatment effect (ATE) and the average treatment effect on the treated (ATET). The adjustment for the ATE estimator is negative (or zero in some special cases), implying that matching on the estimated propensity score is more efficient than matching on the true propensity score in large samples. However, for the ATET estimator, the sign of the adjustment term depends on the data generating process, and ignoring the estimation error in the propensity score may lead to confidence intervals that are either too large or too small.
New insights: The accretion process and variable wind from TW Hya

For the first time in a classical T Tauri star, we are able to trace an accretion event signaled by an hour-long enhancement of X-rays from the accretion shock and revealed through substantial sequential changes in optical emission line profiles. Downflowing turbulent material appears in Hα and Hβ emission. He D3 (5876 A) broadens, coupled with an increase in flux. Two hours after the X-ray accretion event, the optical veiling increases due to continuum emission from the hot splashdown region. The response of the stellar coronal emission to the heated photosphere follows about 2.4 hours later, giving direct evidence that the stellar corona is heated in part by accretion. Then, the stellar wind becomes re-established. A model that incorporates the dynamics of this sequential series of events includes: an accretion shock, a cooling downflow in a supersonically turbulent region, followed by photospheric and later, coronal heating. This model naturally explains the presence of broad optical and ultraviolet lines, and affects the mass accretion rates currently determined from emission line profiles. These results, coupled with the large heated coronal region revealed from X-ray diagnostics, suggest that current models are not adequate to explain the accretion process in young stars. (© 2013 WILEY-VCH Verlag GmbH & Co. KGaA, Weinheim)
The Social Value of Academic Freedom Defended

This essay argues for the social value of academic freedom in law schools and in the university generally. It takes explicit issue with the arguments of Stanley Fish in Versions of Academic Freedom: From Professionalism to Revolution. The essay maintains that academic freedom is essential to a liberal society and deserving of constitutional protection because scholarship and teaching governed by disciplinary norms represents modernity's best secular effort at separating truth from falsehood.
Some Neglected Axioms in Fair Division

Conditions one might impose on fair allocation procedures are introduced. Nondiscrimination requires that agents share an item in proportion to their entitlements if they receive nothing else. The "price" procedures of Pratt (2007), including the Nash bargaining procedure, satisfy this. Other prominent efficient procedures do not. In two-agent problems, reducing the feasible set between the solution and one agent's maximum point increases the utility cost to that agent of providing any given utility gain to the other and is equivalent to decreasing the dispersion of the latter's values for the items he does not receive without changing their total. One-agent monotonnicity requires that such a change should not hurt the first agent, limited monotonicity that the solution should not change. For prices, the former implies convexity in the smaller of the two valuations, the latter linearity. In either case, the price is at least their average and hence spiteful.
The American Challenge to International Law: A Tentative Framework for Debate

The United States often appears hypocritical in its commitment to International Law. It supports Nuremberg, Yugoslavia, and Rwandan tribunals, but opposes the International Criminal Court. It supports the creation of the United Nations, but seeks unilateral action in Iraq. This Essay explores these seeming contradictions in American stances toward international law. It argues that while such apparent hypocrisy might be explained by mere pragmatism, ideas prevalent in American foreign policy history seem to point in a more dangerous direction, that such divergent actions may actually be informed by a coherent, specifically American conception of international law. In particular, this Essay argues that when International Law is viewed through the prism of American liberal constitutionalism, a specifically American conception of international law, legality, and legitimacy emerges. Further, this Essay argues that if such a conception exists, it poses real challenges for traditional Positivist and Cosmopolitan conceptions of international law. This Essay tentatively argues that to meet such challenges, International Law must be reconceived as a dynamic process of institution building rather than the neutral application of static principles. By focusing on the role of international lawyers in the creation rather than the discovery of international law, we can begin to see a role for international law and the international lawyer in a world of ideology.
Is Transnational Litigation Different

During the last fifteen years, there has been a growing interest in litigation transcending national borders. Yet, both in the United States and in Europe, where this interest is much older, a comprehensive intellectual framework to deal with this type of litigation is hard to find. In fact, courts and procedural law reformers still approach transnational cases in the same fashion as purely domestic ones, adjusting the concepts of domestic law where they believe it necessary. This has created significant problems both for litigants seeking justice in transnational cases and for lawmakers fashioning policy specifically for the transnational setting. In light of recent developments in international trade law and in the European Union, this Article argues that, as a normative matter, we should begin to treat transnational litigation as a distinct field. It suggests that in-depth procedural comparison and international relations theory would have much to contribute to such a field. It uses a case study on judicial cooperation in Germany for litigation in the United States to demonstrate various ways in which lawmaking for transnational litigation is interconnected beyond national borders. The Article concludes that procedural law reformers who continue to disregard insights from both international politics and comparative procedure are apt to lose control over their lawmaking efforts to savvy groups, to international trade regimes such as the WTO and NAFTA, and to lawmakers abroad. * Associate Professor, University of Akron School of Law. LL.B. 1990, University of Bern, Switzerland; M.L.I. 1993, LL.M. 1995, University of Wisconsin, Madison, J.S.D. 2002, University of Bern Switzerland. I am indebted to Ron Brand, Steve Burbank, Kevin Clermont, Annelise Riles, Tom Rowe, Gerhard Walter, and to the participants of a faculty workshop at Cornell Law School for valuable comments on earlier drafts of this Article and to Louise Teitz and Fridolin Walther for insightful discussions. Unless otherwise indicated, translations are mine.
First-Purchase Rights: Rights of First Refusal and Rights of First Offer

This paper analyzes rights of first refusal and rights of first offer in a multiple-buyer, sequential bargaining setting. A right of first refusal entitles the right-holder to purchase a subject asset on the same terms as those accepted by a third party. A right of first offer requires a seller to first offer the right-holder to buy a subject asset and prohibits the seller from subsequently selling the asset to a third party on better terms than those offered to the right-holder. We examine when and how such rights yield benefits to, or impose costs, on the right-holder and the seller. We show that a right of first refusal transfers value from other buyers to the right-holder, but may also force the seller to make suboptimal offers. A right of first offer induces the seller to lower his first-period offer, which will tend to increase the net surplus to the seller and rightholder, but also forces the seller to make suboptimal subsequent offers. We find conditions under which it is in the ex ante interest of the seller and the right-holder to contract for a right of first refusal or a right of first offer, respectively. (JEL K12, C78)
Benefit-Cost Analysis for Financial Regulation

Calls for benefit-cost analysis in rule-making, based on the Dodd-Frank Wall Street Reform Act, have revealed a paucity of work on allocative efficiency in financial markets. We propose three principles to help fill this gap. First, we highlight the need for quantifying the statistical cost of a crisis to trade off the risk of a crisis against loss of growth during good times. Second, we propose a framework quantifying the social value of price discovery, and highlighting which arbitrages are over- and under-supplied from a social perspective. Finally, we distinguish between insurance benefits and gambling-facilitation harms of market completion.
Risk Management in the Agri-food Sector

D23, D81, L14, L22, L25, O17, Q12, Q13, Q18, Q52 Key woRdS: JeL Classification: risk management; market, private, and public governance; agri-food chain 1 Institute of Agricultural Economics, Bulgaria Correspondence concerning this article should be addressed to: Hrabrin Bachev, Institute of Agricultural Economics, 125 Tzarigradsko shosse, blok 1, Sofia 1113, Bulgaria, e-mail: hbachev@yahoo.com Hrabrin Bachev1 Primary submission: 29.06.2012 | Final acceptance: 05.10.2012
High-energy quasiparticle injection into mesoscopic superconductors.

At non-zero temperatures, superconductors contain excitations known as Bogoliubov quasiparticles (QPs). The mesoscopic dynamics of QPs inform the design of quantum information processors, among other devices. Knowledge of these dynamics stems from experiments in which QPs are injected in a controlled fashion, typically at energies comparable to the pairing energy1–5. Here we perform tunnel spectroscopy of a mesoscopic superconductor under high electric fields. We observe QP injection due to field-emitted electrons with 106 times the pairing energy, an unexplored regime of QP dynamics. Upon application of a gate voltage, the QP injection decreases the critical current and, at sufficiently high electric field, a field-emission current (<0.1 nA in our device) switches the mesoscopic superconductor into the normal state, consistent with earlier observations6. We expect that high-energy injection will be useful for developing QP-tolerant quantum information processors, will allow rapid control of resonator quality factors and will enable the design of electric-field-controlled superconducting devices with new functionality. Typically, quasiparticles are injected into superconductors at energies comparable to the pairing energy in order to gain insights into quasiparticle dynamics. Tunnelling spectroscopy of a mesoscopic superconductor under high electric field now provides insights into a regime where electrons impinge with 106 times the pairing energy.
The quality effect: Does financial liberalization improve the allocation of capital?

Abstract We document evidence of a “quality effect” of financial liberalization on allocative efficiency, as measured by dispersion in Tobin's Q across firms. We predict that financial liberalization, by equalizing access to credit, is associated with reduced variation in expected marginal returns. We test this prediction using a new financial liberalization index and firm-level data for five emerging markets: India, Jordan, Korea, Malaysia, and Thailand. We find robust evidence that financial liberalization, rather than financial deepening, is associated with improved allocative efficiency.
Emerging legislative regimes for regulating carbon capture and storage activities in Australia: to what extent do they facilitate access to procedural justice?

Anthropogenic climate change is a fundamental challenge. Of the various responses to this “super wicked problem”, carbon capture and storage (CCS) is one that has been mooted in Australia during recent years. While many commentators continue to question the technological and economic feasibility of CCS, a number of Australian governments have adopted a proactive stance to CCS by amending or enacting legislation to regulate CCS activities in their respective jurisdictions. To date, there has been little critical examination of these legislative regimes and their implications for the future role of CCS in Australia. Accordingly, this article will focus upon one central area of CCS regulation that has not been comprehensively addressed by the existing literature – that is, the extent to which emerging legislative regimes for regulating CCS activities in Australia facilitate access to procedural justice. Access to procedural justice will generally be facilitated in circumstances where the law gives procedural rights to members of the community of justice to: have access to information, participate in decision-making processes, and have access to review procedures before a court or tribunal to challenge decision-making or impairment of substantive or procedural rights. This article undertakes a comparative analysis of the laws that have been enacted or amended to regulate CCS activities in Australian jurisdictions in order to identify standards of best practice for facilitating access to procedural justice. It finds that while many of the laws regulating CCS activities in Australia reflect clear attempts by government to facilitate access to procedural justice, some of these laws fall short of facilitating access to procedural justice in an adequate or sufficient manner. Recommendations for law reform are made with the aim of providing guidance as to how Australian CCS laws can better facilitate access to procedural justice in the future.
New York: The Next Mecca for Judgment Creditors? An Analysis of Koehler v. Bank of Bermuda Ltd.

New York may have just become a great place to be a judgment creditor. In the summer of 2009, the Court of Appeals of New York handed down its decision in Koehler v. Bank of Bermuda Ltd. In Koehler, the court upheld a turnover order directing a garnishee to transfer a non-resident judgment debtor’s assets, deposited in a Bermuda bank, into New York. Under Koehler, assets anywhere in the world may now be garnishable in New York so long as the garnishee is subject to the state’s jurisdiction. This decision greatly broadens New York courts’ power to enforce judgments by reaching property located outside of New York. Accordingly, the decision is an incredible victory for judgment creditors, yet a serious defeat for judgment debtors. Because of New York’s status as a financial and corporate capital – and the concomitant number of institutions doing business within the state – this decision has a potentially far-reaching impact. Perhaps not surprisingly, the Koehler decision raises some serious constitutional and policy concerns. As some commentators fear, the decision may ultimately turn New York courts into a “mecca” for judgment creditors seeking to reach assets located anywhere in the world. This Comment seeks to explore the issues raised by the Koehler decision. In doing so, this Comment analyzes theories of due process and state power in the realm of postjudgment garnishments. This Comment ultimately concludes that the Koehler decision was correctly decided, particularly because it will afford judgment creditors an incredibly useful tool in satisfying their judgments.
Disclosure Readability and the Sensitivity of Investors' Valuation Judgments to Outside Information

ABSTRACT: Prior literature suggests that investors react less strongly to information in less readable disclosures. We extend this literature by considering how disclosure readability affects the sensitivity of investors' valuation judgments to the information contained in outside (i.e., non-firm) sources of information. Using an experiment, we present investors with a disclosure containing mixed news about the valence of firm performance, and this disclosure varies in readability. We find that investors who initially view a less readable firm disclosure provide valuation judgments that incorporate the outside information to a greater extent, such that their valuation judgments are more sensitive to whether outside information is relatively more or less supportive of management's positive forward-looking statements. We find evidence that this occurs primarily because investors who view a less readable initial disclosure feel less comfortable evaluating the firm and, in turn, rely more on the outside info...
Stipulation of Excess in Understanding and Misunderstanding Riba : The Al-Jassas Link

An essential condition in the orthodox definition of riba is stipulated excess in a loan or debt. This essential condition is traced to al-Jassas. Understanding this issue of stipulated excess is critical to understanding riba . In this paper the stipulated excess in connection with al-Jassas as well as its implication for defining riba and prohibition of interest is examined. A critical examination of the subject shows that pre-Jassas discourse about riba did not include stipulated excess as an essential condition and al-Jassas' changing of the conditions in defining riba is not corroborated by the textual evidences he used.
The Malleable Self: The Role of Self-Expression in Persuasion:

Considerable research in consumer experimental psychology has examined the self-expressive role of brands but has found little support for the premise that the interaction of the personality traits...
The chronic uncertainty of American Indian property rights

Property institutions should ideally provide economic actors with certainty that their local choices about investment will not be unsettled by shifting political economic equilibria. We argue that for this to occur, political autonomy, administrative and enforcement capacity, political constraints, and accessible legal institutions are each necessary. A comparison of the evolution of property rights for settlers and American Indians in the United States shows how political and legal forces shape the evolution of property institutions. American Indians, who had property institutions before Europeans arrived, could not defend their land from Europeans and later Americans due to lacking military capacity. Settlers' property rights were relatively secure because the government had sufficient autonomy and capacity to broadly define and enforce their rights, political institutions constrained the government from expropriating settlers' property, and legal institutions provided a forum for settlers to adjudicate and defend their rights in court. Native Americans, in contrast, had systematically inconsistent and often expropriative policy treatment by the government. Although tribes have technically been sovereign since the 1970s, tribal governments continue to lack sufficient political and legal autonomy and capacity to define and enforce property institutions in response to evolving local conditions.
CEO attributes, compensation, and firm value: Evidence from a structural estimation

Abstract I present and estimate a dynamic model of chief executive officer (CEO) compensation and effort provision. I find that variation in CEO attributes explains the majority of variation in compensation (equity and total) but little of the variation in firm value. The primary drivers of cross-sectional compensation are risk aversion and influence on the board. Additionally, I estimate the magnitude of CEO agency issues. Removing CEO influence increases shareholder value in the typical firm by 1.74%, making CEOs risk neutral increases shareholder value by 16.12%, and removing all agency frictions increases shareholder value by 28.99%.
Commanding board of director attention: Investigating how organizational performance and CEO duality affect board members' attention to monitoring

Boards of directors' attention to monitoring represents an understudied topic in corporate governance. By analyzing hundreds of board meeting transcripts, we find that board members do not maintain constant levels of attention toward monitoring, but instead selectively allocate attention to their monitoring function. Drawing from the attention-based view, prospect theory, and the literature on power, we find that deviation from prior performance and CEO duality affect this allocation. Specifically, while negative deviation from prior performance increases boards' attention to monitoring, positive deviation from prior performance reduces it. The presence of duality also reduces the boards' allocation of attention to monitoring. Additional analysis demonstrates that the effects of duality are realized in part by the CEO-chair's control of the meeting's agenda and location. Finally, the results show that duality and deviation from prior performance interactively affect boards' attention to monitoring. In total, we find that board members do not consistently monitor management in order to protect shareholder value, a proposition often assumed within governance research; rather, our results demonstrate that board members' monitoring behaviors are contextually dependent. The contextual dependency of board attention to monitoring suggests that additional efforts may be needed to ensure the protection of shareholders' interests. Copyright © 2010 John Wiley & Sons, Ltd.
Simple methods for evaluating and comparing binary experiments

We consider a confidence parametrization of binary information sources in terms of appropriate likelihood ratios. This parametrization is used for Bayesian belief updates and for the equivalent comparison of binary experiments. In contrast to the standard parametrization of a binary information source in terms of its specificity and its sensitivity, one of the two confidence parameters is sufficient for a Bayesian belief update conditional on a signal realization. We introduce a confidence-augmented receiver operating characteristic for comparisons of binary experiments for a class of “balanced” decision problems, relative to which the confidence order offers a higher resolution than Blackwell’s informativeness order. Where observation is concerned, Chance favors only the prepared mind. —Louis Pasteur (1822–1895).
Estimating Property Values by Replication: An Alternative to the Traditional Grid and Regression Methods

This paper proposes and develops a replication method for estimating property values, in which optimal weights of comparable property attributes that best duplicate the subject property are determined. In a setting where the number of comparables is large compared to the number of attributes, replication weakly outperforms traditional general least squares regression by making use of potential correlations in the error structure. A similar result obtains in comparison to the grid method, which may suffer from subjective price adjustment factors. The replication method suggests using a large sample regression analysis to obtain the functional form of the error variance-covariance, and then replicating the subject with a smaller, attribute-close set of comparable properties.
Productivity gains from unemployment insurance

This paper argues that unemployment insurance increases labor productivity by encouraging workers to seek higher productivity jobs, and by encouraging rms to create those jobs. We use a quantitative model to investigate whether this eect is comparable in magnitude to the standard moral hazard eects of unemployment insurance. Our model economy captures the behavior of the U.S. labor market for high school graduates quite well. With unemployment insurance more generous than the current U.S. level, unemployment would increase by a magnitude similar to the micro-estimates; but because the composition of jobs also changes, total output and welfare would increase as well.
Integrating the Least Developed Countries into the World Trading System : The Current Impact of EU Preferences under Everything but Arms

Trade preferences are a key element in industrial countries’ efforts to assist the integration of least developed countries (LDCs) into the world economy. Brenton provides an initial evaluation of the impact of the European Union’s recently introduced “Everything but Arms” (EBA) initiative on the products currently exported by the LDCs. He shows that the changes introduced by the EBA initiative in 2001 are relatively minor for currently exported products, primarily because over 99 percent of EU imports from the LDCs are in products which the EU had already liberalized, and the complete removal of barriers to the key remaining products—rice, sugar, and bananas—has been delayed. Brenton looks at the role EU preferences to LDCs in general have been playing and could play in assisting the integration of the LDCs. He shows that there is considerable variation across countries in the potential impact that EU preferences can have given current export structures. There is a group of LDCs for whom EU trade preferences on existing exports are not significant since these exports are mainly of products where the most-favored-nation duty is zero. Export diversification is the key issue for these countries. For other LDCs, EU preferences have the potential to provide a more substantial impact on trade. However, the author shows that only 50 percent of EU imports from non-ACP (Africa, Caribbean, and Pacific) LDCs which are eligible actually request preferential access to the EU. The prime suspect for this low level of use are the rules of origin, both the restrictiveness of the requirements on sufficient processing and the costs and difficulties of providing the necessary documentation. More simple rules of origin are likely to enhance the impact of EU trade preferences in terms of improving market access and in stimulating diversification toward a broader range of exports.
Rent-seeking with scarce talent: A model of preemptive hiring

In a standard rent-seeking contest, players optimally employ resources in an attempt to obtain the rent. Typically, it is assumed that these resources may be hired at any desired level at some exogenous per-unit cost. In practice, these resources often consist of scarce, talented individuals. We model a rent-seeking contest with scarce talent and find that talent scarcity leads to preemptive hiring by the player receiving the larger rent. This player hires all available talent and wins the contest with probability 1. This is true even when the difference in rents is small.
Dynamic Equilibrium with Overpriced Put Options

It is a well-known anomaly that prices of put options are too high when options are out-of-the-money. This paper presents a simple general equilibrium model of the market where European put options become substantially overpriced when they are out-of-the-money. Overpricing is due to the presence of short-sale constraints on trading stocks and derivatives, as well as the heterogeneity between investors. We confirm the predicting power of the model by comparing its implications with existing empirical results.
A Test of the Reliability of Current Cost Disclosures

Using data from corporate acquisitions recorded under the purchase method, this research tests the reliability (representational faithfulness) of current cost disclosures. The fair value of property, plant, and equipment recorded by the acquiring company following the acquisition is found to be significantly related to the current cost disclosures made by the acquired company prior to the acquisition. When the data are segmented according to reporting regime, the significant relationship pertains to the SFAS 33 disclosures but not to ASR 190 disclosures of current cost. The study also finds that the results pertain primarily to current cost disclosures made shortly before the acquisition date. Overall, the results support current initiatives for increased departure from historical-cost approaches to accounting, especially if these measures are made along the lines of SFAS 33 techniques rather than ASR 190 techniques.
Optimizing error of high-dimensional statistical queries under differential privacy

Differentially private algorithms for answering sets of predicate counting queries on a sensitive database have many applications. Organizations that collect individual-level data, such as statistical agencies and medical institutions, use them to safely release summary tabulations. However, existing techniques are accurate only on a narrow class of query workloads, or are extremely slow, especially when analyzing more than one or two dimensions of the data.In this work we propose HDMM, a new differentially private algorithm for answering a workload of predicate counting queries, that is especially effective for higher-dimensional datasets. HDMM represents query workloads using an implicit matrix representation and exploits this compact representation to efficiently search (a subset of) the space of differentially private algorithms for one that answers the input query workload with high accuracy. We empirically show that HDMM can efficiently answer queries with lower error than state-of-the-art techniques on a variety of low and high dimensional datasets.
Capacity planning and performance contracting for service facilities

Market demand uncertainty and time-based competition make capacity investment and managerial incentive decisions for service facilities such as high-end diagnostic medical imaging centers, modern IT services, or contract manufacturing shops particularly challenging. These facilities compete on service quality, short queuing times and speed. Therefore, having insufficient capacity can be economically devastating for them. Given the high up-front costs involved, firms want to make sure that they neither over- nor under-invest in service capacity. These problems get exasperated by the fact that typically firms are unfamiliar with the local market conditions and do not closely observe the demand-generating efforts of the hired managers. Most prior studies of cost allocation methodologies, contract design, and service resource management tend to address these aspects of the problem separately. They ignore the interaction effects between the capacity decisions and the managerial adverse selection and moral hazard issues, which are crucial elements for successfully running services with fixed capacity, random arrivals, and stochastic service times. Our paper instead focuses on the development of an integrated-approach to the simultaneous design of efficient managerial contracts and of capacity planning for capital intensive service facilities. We derive optimal linear contracting structures under information asymmetry between the firms and management, and analyze their impact on capacity decisions, service levels, service volumes, and the allocations of costs. Surprisingly, we prove that even though a franchise (charge-back) contract induces the first-best effort from the manager, it is not always the best choice for the firms as it may lead to inferior profits for them. In fact, our results explain why a firm's eventual contract choice should be a function of its prior on the probability distribution of the local market demand. We also explain when it may be optimal (for both the firm and the manager) to charge the manager up front a fixed franchising fee that is even greater than the total costs of capacity. Our study applies to many capital-intensive and congestion-prone service systems, where the success of significant up-front capacity investments also hinges on the daily operations of those facilities run by hired managers-who typically possess specific knowledge-that gives them a significant information advantage.
Finite lifetimes and growth

Abstract In this paper we study the long run growth property of overlapping generations models. It is shown that in one sector models with convex technologies the asymptotic growth rate must be zero. This results because the young do not have sufficient income to purchase a large capital stock. Thus, a policy of income redistribution to the young can generate growth even if financed by income taxation. Additionaly, it is shown that two sector models and one sector models with nonconvex technologies are consistent with growth.
A Glycoprotein Mutation That Emerged during the 2013-2016 Ebola Virus Epidemic Alters Proteolysis and Accelerates Membrane Fusion.

ABSTRACT Genomic surveillance of viral isolates during the 2013–2016 Ebola virus epidemic in Western Africa, the largest and most devastating filovirus outbreak on record, revealed several novel mutations. The responsible strain, named Makona, carries an A-to-V substitution at position 82 (A82V) in the glycoprotein (GP), which is associated with enhanced infectivity in vitro. Here, we investigated the mechanistic basis for this enhancement as well as the interplay between A82V and a T-to-I substitution at residue 544 of GP, which also modulates infectivity in cell culture. We found that both 82V and 544I destabilize GP, with the residue at position 544 impacting overall stability, while 82V specifically destabilizes proteolytically cleaved GP. Both residues also promote faster kinetics of lipid mixing of the viral and host membranes in live cells, individually and in tandem, which correlates with faster times to fusion following colocalization with the viral receptor Niemann-Pick C1 (NPC1). Furthermore, GPs bearing 82V are more sensitive to proteolysis by cathepsin L (CatL), a key host factor for viral entry. Intriguingly, CatL processed 82V variant GPs to a novel product with a molecular weight of approximately 12,000 (12K), which we hypothesize corresponds to a form of GP that is pre-triggered for fusion. We thus propose a model in which 82V promotes more efficient GP processing by CatL, leading to faster viral fusion kinetics and higher levels of infectivity. IMPORTANCE The 2013–2016 outbreak of Ebola virus disease in West Africa demonstrated the potential for previously localized outbreaks to turn into regional, or even global, health emergencies. With over 28,000 cases and 11,000 confirmed deaths, this outbreak was over 50 times as large as any previously recorded. This outbreak also afforded the largest-ever collection of Ebola virus genomic sequence data, allowing new insights into viral transmission and evolution. Viral mutants arising during the outbreak have attracted attention for their potentially altered patterns of infectivity in cell culture, with potential, if unclear, implications for increased viral spread and/or virulence. Here, we report the properties of one such mutation in the viral glycoprotein, A82V, and its interplay with a previously described polymorphism at position 544. We show that mutations at both residues promote infection and fusion activation in cells but that A82V additionally leads to increased infectivity under cathepsin-limited conditions and the generation of a novel glycoprotein cleavage product.