cssi/SciSciGPT-SciSciNet huggingface dataset:
THE IMPRISONMENT PUZZLE: UNDERSTANDING HOW PRISON GROWTH AFFECTS CRIME

Many early empirical studies found that prison growth is associated with substantial reductions in crime. However, recent studies find no statistically significant relationship between growth in prison populations and crime. Even more striking, one recent study finds that, in certain circumstances, imprisoning more people can even increase crime.I attempt here to briefly solve the puzzle, suggesting how the studies conflicting findings might be reconciled. The differences in the studies’ results may be due to the different characteristics of the periods that the studies address. The earlier studies examined periods when prison populations tended to grow by adding additional violent and property offenders. The studies’ empirical results supported what theory would seem unambiguously to suggest: that putting more offenders in prison should decrease crime by both incapacitating incarcerated offenders and deterring potential offenders. In contrast, during the periods that the later studies addressed, both the War on Drugs and new sentencing reforms caused prison populations to grow in two additional and different ways: by adding drug offenders and by increasing sentence lengths for low-level offenders. I discuss several reasons why imprisoning more drug offenders may not reduce crime and may even increase it. I also evaluate how longer sentences for low-level offenders may have similar, counterproductive effects. Finally, I explore how recent increases both in the numbers of drug offenders and in sentence lengths for low-level offenders might reconcile the studies’ results.
Responsibility and Social/Political Choices about Choice; or, One Way to be a True Non-voluntarist

Linking choice with responsibility is a seduction our voluntarist society often cannot resist. We generally wish to hold people responsible in our tort and criminal law for their free choices - and conceive of responsibility as intimately bound up with personal choice. Samuel Scheffler may have diagnosed why many redistributive forms of liberalism often fail to command support in the public sphere: because they regularly deny what seems to be a basic moral intuition of our society - that people should be held responsible for their free choices. To be sure, the contours of what counts as a free choice and what counts as a product of duress, genetics, or upbringing sufficient to vitiate or mitigate responsibility is always a matter of vigorous ongoing contestation. Still, there remains a strong intuition in our society's collective moral psychology that responsibility is somehow deeply connected to free choices. Indeed, we might not be able to make sense of ourselves as selves without feeling justified in claiming responsibility first and foremost for what we perceive to be our own free choices. The potential that the Causal Thesis may be true - that some weak form of determinism obtains - does not deter us: to reinforce our aspiration for free will, we tend to design our punitive policies and moral practices of praise and blame consistent with it, in spite of our failure to have a clear faith that our institutions contribute to members' true freedom. We do this, some would argue, to retain the basic connection of responsibility to choice; the business of apportioning responsibility somehow seems manageable, justifiable, and legitimate if it is tied to choice. Accordingly, even many determinists among us are compatibilists. Here, I make an effort to think hard about the purported connection between responsibility and choice - and try to avoid the seduction of voluntarism. I build from the work of Meir Dan-Cohen, who has done the most to develop a theory of responsibility unmoored from choice. In the process, I touch upon love and creativity, two areas of social life that provide a window into a different conception of responsibility that can be used to guide our practices of praise and blame in morality, the criminal law, and torts.
Financial Market Failure as a Crisis in the Rule of Law: From Market Fundamentalism to a New Keynesian Regulatory Model

This article considers the financial panic of 2008 in historical context by analyzing the institutional and regulatory factors that contributed to the financial and economic crisis. The move away from a Keynesian regulatory model was a function of larger institutional flaws. The Keynesian regime of command-and-control regulation focused on macroeconomic policy objectives designed to achieve full employment, more equitable distributions of wealth and income, greater transparency in the regulatory process, and reduction in monopoly exploitation of consumers. Central to this regime was a model of central banking that required greater accountability to elected branches of government and the use of selective credit controls to complement general monetary policy measures. As the Federal Reserve (the Fed) became increasingly subject to agency capture by its private financial constituencies, it also became a leading force behind the deregulation of interest rates and lending standards, and the adoption of risk-based capital requirements. These trends, in turn, undermined the transparency of financial institutions and markets, and encouraged the development of an unsustainable, bubble economy. The privatized Federal Reserve System represents a profound rule-of-law failure that is reflected in today’s bailout model which socializes losses and privatizes gains for “too big to fail” financial institutions. This captured Fed represents a significant impediment to effective financial regulation and a proper balance of constitutional authority on monetary and fiscal policymaking between elected and appointed branches and private actors. This article recommends reviving the model of institutional law and Keynesian economics by suggesting a more complete and integrated approach to financial regulation that would keep competition within prescribed limits while allocating credit and capital away from private, speculative activity and into longer-term public investment in physical and social infrastructure. A necessary precondition is reform of the Fed’s institutional structure to safeguard monetary policy and financial regulation from a self-serving financial industry.
Empirical Exchange Rate Models of the Nineties: Are Any Fit to Survive?

Abstract We re-assess exchange rate prediction using a wider set of models that have been proposed in the last decade: interest rate parity, productivity based models, and a composite specification. The performance of these models is compared against two reference specifications – purchasing power parity and the sticky-price monetary model. The models are estimated in first-difference and error correction specifications, and model performance evaluated at forecast horizons of 1, 4 and 20 quarters, using the mean squared error, direction of change metrics, and the “consistency” test of Cheung and Chinn [1998. Integration, cointegration, and the forecast consistency of structural exchange rate models. Journal of International Money and Finance 17, 813–830]. Overall, model/specification/currency combinations that work well in one period do not necessarily work well in another period.
Inequalities between Groups: Theory and Empirics

Summary Inequality between identity groups has long been thought of as an important contributor to social unrest and violence as well as being important in assessing the justice of societies. Yet, the measurement of the ways in which such groups differ and are unequal remains underdeveloped. Accordingly, this paper introduces three distinct but interlinked concepts relating to inequality between groups which can be used in empirical estimation of group based inequality. We define and discuss the concepts of representational inequality, sequence inequality, and group inequality comparison. Representational inequality captures the extent to which a given level of attribute is shared between members of distinct groups, sequence inequality captures the extent to which groups are ordered hierarchically in their possession of the attribute and group inequality comparison captures the extent to which differences between groups account for the overall inequality of individuals. These concepts can be used to measure the degree of segregation, clustering, and polarization between groups. In order to illustrate the merit of these concepts and their joint application to understanding group based inequality we provide an example using Demographic and Health Surveys data for five societies. It may be seen that the choice of measures is greatly consequential in applied work.
Non-beneficial pediatric research and the best interests standard: a legal and ethical reconciliation.

Federal efforts beginning in the 1990's have successfully increased pediatric research to improve medical care for all children. Since 1997, the FDA has requested 800 pediatric studies involving 45,000 children. Much of this research is "non-beneficial"; that is, it exposes pediatric subjects to risk even though these children will not benefit from participating in the research. Non-beneficial pediatric research (NBPR) seems, by definition, contrary to the best interests of pediatric subjects, which is why one state supreme court has essentially prohibited it. It also appears that the only plausible rationale for this research is utilitarian, as it risks some children for the good of all. But that rationale is troubling. This Article answers two related questions: (1) What is the appropriate legal relationship between NBPR and the "best interests of the child" standard? (2) What is the ethical justification for this research? I argue that courts should hold that the "best interests" standard governs pediatric research. But, contrary to existing case law, courts must consider the benefits to each child, including pediatric subjects, from a policy that permits NBPR, and not simply consider that a non-beneficial protocol presents more risk than potential benefit to a child. Moreover, I argue that the justification for the practice need not be utilitarian. There is no need to appeal to the greater good to justify the research because each child has reason to endorse a policy permitting NBPR where there is a very low ceiling on acceptable risk, and each child has reason to participate in a practice from which she benefits. More controversially, I argue that each child, like other persons, has reason to help others when she can do so at little to no cost to herself. The Article then highlights practical implications of the offered justifications.
Pricing to Market in Japanese Manufacturing

Abstract This paper investigates pricing by Japanese manufacturing firms in export and domestic markets. The paper reports equations explaining the margin between export prices in yen and domestic prices for seventeen products in the transport and electrical machinery industries. Evidence is presented showing that Japanese firms respond to changes in real exchange rates by ‘pricing to market’, varying their export prices in yen relative to their domestic prices. The empirical specification makes it possible to disentangle planned changes in the margin between export and domestic prices from inadvertent changes in this margin due to unanticipated changes in exchange rates.
The Public Choice Problem in Corporate Law: Corporate Social Responsibility After Citizens United

The Supreme Court held in Citizens United v. Federal Elections Commission (2010) that the First Amendment forbids Congress from restricting the political speech of corporations. While corporate theory did little to inform the Court’s thinking in Citizens United, this Article argues that the holding in Citizens United requires us to rethink corporate theory. The shareholder primacy norm in American corporate governance relies on the assumption that corporations can be restrained from influencing external governmental operations. We can enjoy the efficiencies generated by shareholder primacy in corporate governance, mainstream corporate theorists have long argued, because we can rely on external regulation to curb or cure the excesses that such a framework will predictably visit upon nonshareholding stakeholders, such as workers, consumers, and communities. Citizens United removes this lynchpin from canonical justifications for exclusive shareholder orientation in firm governance. This Article argues that if we cannot as a matter of constitutional law keep corporations out of our democracy, then we must as a matter of corporate law have more democracy in our corporations. After Citizens United, we must begin to restructure corporate law to require boards of directors to actively attend to the interests of multiple stakeholders at the level of firm governance.
How Much Does Your Banker’s Target-Specific Experience Matter? Evidence from Target IPO Underwriters that Advise Acquirers

In a sample of 1,507 US all-public acquisitions from 1985–2014, 5% of acquirers use the same advisor that underwrote the target’s initial public offering. Acquirers who use these informed advisors have acquisition announcement three-day cumulative abnormal returns (CARs) that are 2.048 percentage points higher, all else equal. Same-advisor acquisition announcements have higher combined CARs but not lower target CARs, suggesting higher synergies instead of lower deal premia. Same-advisor acquisition announcement outperformance decays as the target ages and grows. These findings show the value and timeliness of investment bank information production, retention, and transfer.
MD&A Disclosure and the Firm's Ability to Continue as a Going Concern

ABSTRACT: This paper explores the role of textual disclosures in the Management, Discussion, and Analysis (MD&A) section of a firm's SEC 10-K filing in predicting a firm's ability to continue as a going concern. Using a sample of firms that filed for bankruptcy between 1995 and 2012 to identify firms that cease as a going concern, we find that both management's opinion about going concern reported in the MD&A and the linguistic tone of the MD&A together provide significant explanatory power in predicting whether a firm will cease as a going concern. Moreover, the predictive ability of MD&A disclosure is incremental to financial ratios, market-based variables, and even the auditor's going concern opinion. We also find that the incremental predictive ability of MD&A disclosures extends to three years prior to bankruptcy.
The Limits to Arbitrage Revisited: The Accrual and Asset Growth Anomalies

Using idiosyncratic volatility as a proxy for arbitrage costs, the authors found that the highly publicized accrual and asset growth anomalies exist because of high barriers to arbitrage, occurring predominantly in the universe of stocks with higher arbitrage risks. Therefore, investors who seek to profit from the accrual and asset growth anomalies must bear greater uncertainty in outcomes than was previously understood.
Floating Maximally Many Boats: A Preference for the Broad Distribution of Market Benefits

Market economics can overreach and reduce all human activities to market-governed activities. More than a market-inspired explanation for human activities, it offers a normative account of how all goods and services should be distributed by private parties negotiating mutually agreeable terms. This paper argues that market values and practices are constrained by other fundamental values and practices. Liberal values are generally consistent with, though they are not reducible to, market values. Democratic and egalitarian values often contrast with market values. The distribution of market benefits should accommodate those democratic and egalitarian values which constitute a polity's core commitments (and those core commitments need to be reasserted regularly). Indeed, market stability depends upon a general distribution of its benefits. Incentives to productive activity entail inequalities, but the terms of those inequalities are subject to review. Internal refinements to specific markets can reduce inequalities by promoting the fairness of market operations and by increasing the number of effective participants.
Local Market Structure and Strategic Organizational Form Choices: Evidence from Gasoline Stations

An extensive literature shows that agency issues and transaction costs impact vertical integration decisions. Another mature literature indicates that market structure influences competitive behavior. Less consideration has been given to how vertical integration and market structure may interact. I address this gap by focusing on the potential for moral hazard arising from intra-firm competition. Focusing on retail gasoline sales, I argue that when multiple stations share a common brand in a market, a vertically separated station has an incentive to deviate from the cooperative strategy that the brand-owning refiner would prefer. I empirically test this prediction using rich data, and find evidence of both such moral hazard and the desire to avoid it.
Grassroots Plea Bargaining

In the 1990s, New York City implemented a particularly vigorous brand of localized order-maintenance policing. Such targeted enforcement of “borderline” offenses led to a skyrocketing rate of non-felony arrests in affected (predominantly poor and minority) communities and, consequently, created a crisis of systemic legitimacy within these communities. Notably, however, enforcement was increasingly heavy-handed only on the policing end. By contrast, when it came to plea bargaining, prosecutors were providing more and more lenient no-time or short-time pleas to reduced (often non-criminal) charges. In this essay, I offer a novel (and at least partial) explanation for this leniency trend. My explanation is a heretofore unrecognized plea-bargaining influence that I call grassroots plea bargaining. By grassroots plea bargaining, I mean a bottom-up pressure that in certain circumstances may lead prosecutors to reduce plea prices in order to purchase communal acquiescence to police policies that otherwise lack public support. In short, as police ramp up enforcement, prosecutors may feel the need to pull back on the punishment throttle to ensure that affected communities accept— or at least tolerate—hard-nosed police tactics.
Local market makers, liquidity and market quality

Abstract We examine the role of geographically proximate (local) market makers in providing liquidity and improving the quality of a dealer market. Firms with active participation of local dealers enjoy lower quoted and effective spreads, as well as more informative prices. The beneficial effects from local market makers are not confined to a few “top” local dealers and they cannot be attributed to their participation in the firm's IPO syndicate or industry specialization. Further, we find that days with aggressive bidding from local market makers relative to their non-local counterparts are associated with significant positive abnormal returns, consistent with local market makers possessing information advantages. In summary, our results suggest that the information advantages of local market makers may be a contributing factor to the reduction in the cost of trading.
Comparing Price and Non-price Approaches to Urban Water Conservation

[1] Urban water conservation is typically achieved through prescriptive regulations, including the rationing of water for particular uses and requirements for the installation of particular technologies. A significant shift has occurred in pollution control regulations toward market-based policies in recent decades. We offer an analysis of the relative merits of market-based and prescriptive approaches to water conservation, where prices have rarely been used to allocate scarce supplies. The analysis emphasizes the emerging theoretical and empirical evidence that using prices to manage water demand is more cost effective than implementing nonprice conservation programs, similar to results for pollution control in earlier decades. Price-based approaches may also compare favorably to prescriptive approaches in terms of monitoring and enforcement. Neither policy instrument has an inherent advantage over the other in terms of predictability and equity. As in any policy context, political considerations are also important.
Policy Challenges of the Heterogeneity of the Value of Statistical Life

Economic research has developed estimates of the heterogeneity of the value of statistical life (VSL) on dimensions such as individual age, income, immigrant status, and the nature of the risk exposure. This paper examines the empirical evidence on the heterogeneity of VSL and explores the potential implications for the valuation of regulatory policies. Previously, the U.S. Environmental Protection Agency (EPA) unsuccessfully sought to adopt a simple age discount percentage for VSL based on survey evidence. However, labor market estimates of VSL indicate a pattern that tracks lifetime consumption trajectories, as the VSL rises with age and eventually tapers off but does not plummet with age. The VSL has an income elasticity of at least 0.5. The analysis of age variations in VSL is accompanied by a review of the value of statistical life year (VSLY) approach. The U.S. Department of Transportation recognizes the influence of a positive income elasticity of VSL, and EPA has proposed adopting a 50% cancer premium. Recent studies suggest that the risk of death from terrorist attacks are of particular concern and may merit a substantial premium in benefit assessments. Whether and how such heterogeneity in VSL should be incorporated in regulatory policy evaluations depends in part on the source of the heterogeneity. Some prominent sources of heterogeneity arise from segmented labor markets in which disadvantaged groups face different labor market opportunities. Blacks and Mexican immigrants face quite different labor market offer curves. As a result, influences that are problematic from the standpoint of setting different benefit levels for policy purposes are differences in VSL by race and immigrant status. The paper also examines the EPA's recent devaluation of life and the Posner–Sunstein proposal to use VSL estimates to set hedonic damages in tort liability cases. As with hedonic damages generally, adoption of their proposal would lead to excessive levels of compensatory damages and would greatly increase damage amounts.
Judging Audit Quality in Light of Adverse Outcomes: Evidence of Outcome Bias and Reverse Outcome Bias*

Considerable auditing research demonstrates that individuals exhibit outcome effects when judging audit quality: That is, they judge auditor negligence higher when given knowledge about adverse audit outcomes. Many studies conclude that knowledge of adverse audit outcomes biases individuals against auditors, and attempt to improve their judgments by reducing outcome effects. Yet, whether outcome effects imply outcome bias is a vexing question: From a Bayesian perspective, individuals should judge auditors more harshly when given adverse outcomes. Logically, individuals could exhibit either outcome bias (over-rely on adverse audit outcomes), reverse outcome bias (under-rely on adverse outcomes), or neither form of bias. Applying Prospect Theory’s probability weighting function, we hypothesize and find that individuals’ negligence judgments exhibit outcome bias when the Bayesian probability of auditor negligence is relatively low, but also exhibit reverse outcome bias when the Bayesian probability is relatively high. This finding is robust to both relatively rich and relatively abstract experimental settings, and to judgments made in hindsight and in foresight. While many factors likely contribute to judgments of auditors potentially being too harsh (e.g., large plaintiff losses and auditors’ “deep pockets”), our conclusions suggest that the effect of adverse outcome information on judgments of auditor negligence is not as obvious, and depends on whether the Bayesian probability of auditor negligence is high or low. We suggest that the model for judgments of auditor negligence should expand to include both outcome bias and reverse outcome bias, where predicted by our combination of outcome effects and Prospect Theory’s probability weighting function.
An index number formula problem: the aggregation of broadly comparable items

Index number theory informs us that if data on matched prices and quantities are available, a superlative index number formula is best to aggregate heterogeneous items, and a unit value index to aggregate homogeneous ones. The formulas can give very different results. Neglected is the practical case of broadly comparable items, for which price dispersion can be decomposed into a quality component, say due to product differentiation, and a component that is stochastic or due to price discrimination. This paper analyses why such formulas differ and proposes a solution to this index number problem. JEL Classification Numbers: C43, C81, E31, L11, L15.
The effects of fantasy football participation on NFL consumption: A qualitative analysis

The growth of fantasy sports into a multi-billion dollar industry has made it an important component of the sports industry. Sport leagues must acknowledge the impact fantasy sports have on the way...
Risk, Uncertainty and Exchange Rates

This paper is motivated by two facts: failure of log-linear empirical exchange rate models of the 1970's and the observed variability of risk premiums in the forward market. Rational maximizing models predict that changes in conditional variances of monetary policies, government spendings, and income growths affect risk premiums and induce conditional volatility of exchange rates. I examine theoretically how changes in these exogenous conditional variances affect the level of the current exchange rate and attempt to quantify the extent that this channel explains exchange rate volatility using autoregressive conditional heteroscedastic models.
Judicial Decision Making in a World of Natural Law and Natural Rights

This article was my contribution to a symposium celebrating the achievements of John Finnis held at the Villanova University School of Law. Finnis’ greatest work is his Natural Law and Natural Rights. I agree with Finnis’ rejection of an approach to natural law which focuses on the notion of natural rights. Finnis’ approach instead focuses on a natural law that is based on the idea that there are certain basic human goods such as the search for knowledge, the maintenance of life, the sharing of fellowship with other human beings, the capacity to enjoy aesthetic experiences, and the exercise of practical reason, to which he adds the almost universal human striving for religious meaning. I accept that human law reflects the broadly accepted human goods and goals that underline our social morality. I explain, however, that, no matter how much we might wish it were otherwise, there will of necessity be some separation between law and morality. In order that law might be predictable and capable of being applied in a coherent and objective manner, a legal system will inevitably have certain arbitrary features about it that can never be completely eliminated and which a rational person would not wish to completely eliminate. That is why a legal system can at most only succeed in achieving a high degree of formal justice. It can never deliver perfect justice.
Can debt crises be self-fulfilling?

Abstract Several papers argue that debt crises can be the result of self-fulfilling expectations that no one will lend to a country, triggering default and rationalizing the refusal to lend. I show these coordination failures can be eliminated by a combination of state-contingent securities and a mechanism that allows investors to promise to lend only if enough other investors do so as well. This suggests that runs on the debt of a single borrower (such as the government) can be eliminated and that self-fulfilling features are more plausible when externalities among many decentralized borrowers allow for economy-wide debt runs to occur.
Rethinking the Corporation (and Race) in America: Can Law (and Professionalization) Fix “Minor” Problems of Externalization, Internalization, and Governance?

This Article focuses on what is right about the modern publicly held corporation and attempts to decouple these attributes from the debate about what needs to be fixed. It attempts to show that much of this "blame game" is ill-founded and misdirected. It instead argues for a more austere restructuring that would actually transcend the corporation per se and focuses on the apparent locus of the difficulties: The management of the large, publicly held business enterprise.The essence of the modern corporation consists of two important elements: (1) limited liability; and (2) the ability to lock in capital regardless of the desires of individual owners or creditors. This Article seeks to highlight these central points, in the specific context of race in America. Part I will seek to show what is right and wrong with the modern corporation. Part II will demonstrate, in general, how the law should respond to this realization of the fundamental strengths and the more "minor" weaknesses of the modern corporation. Part III will apply these lessons to the problems of race in America in 2005. The Article concludes that law plays an important role in the dementia of corporate wrongdoing but that the legal foundation of the corporation itself is not to blame. Instead, the blame lies largely in the legal infrastructure (or lack thereof) surrounding the corporation. In particular, corporate governance law in the US devolved to a CEO primacy model. The real question that recent corporate misconduct raises is whether it is now past time to insist upon professional management of publicly held companies. This Article suggests a road map for racial reformers thinking about the central role that the corporation has played in our economy.
INFORMATIONAL SIZE AND INCENTIVE COMPATIBILITY

We examine a general equilibrium model with asymmetrically informed agents. The presence of asymmetric information generally presents a conflict between incentive com- patibility and Pareto efficiency. We present a notion of informational size and show that the conflict between incentive compatibility and efficiency can be made arbitrarily small if agents are of sufficiently small informational size. The incompatibility of Pareto efficiency and incentive compatibility is a central theme in economics and game theory. The issues associated with this incompatibility are particularly important in the design of resource allocation mechanisms in the presence of asymmetrically informed agents where the need to acquire information from agents in order to compute efficient outcomes and the incentives agents have to misrepresent that information for personal gain come into conflict. Despite a large literature that focuses on these issues, there has been little work aimed at understanding those situations in which informational asymmetries are quantitatively important. Virtually every transaction is characterized by some asymmetry of information: any investor who buys or sells a share of stock generally knows something rel- evant to the value of the share that is not known to the person on the other side of the transaction. In order to focus on more salient aspects of the problem, many models (rightly) ignore the incentive problems associated with informa- tional asymmetries in the belief that, for the problem at hand, agents are "infor- mationally small." However, few researchers have investigated the circumstances under which an analysis that ignores these incentive problems will yield results similar to those obtained when these problems are fully accounted for. In this paper, we study a class of mechanism design problems. Our goal is to formalize informational size in a way that, when agents are informationally small, 1 Early versions of this paper circulated under the titles "Informational Smallness and Pareto Effi- ciency" and "Informational Smallness and Incentive Compatibility." We thank Jacques Cremer, Dean Foster, Andreu Mas-Colell, Stephen Morris, David Schmeidler, and particularly, Faruk Gul for help- ful conversations and Rajiv Vohra for a very careful reading. We also thank the numerous partici- pants in seminars at which this paper was presented for helpful comments. We also thank an editor and the referees for very helpful comments, and thank Ichiro Obara for pointing out an error in an earlier version. Postlewaite gratefully acknowledges support from the National Science Foundation.
Improvement reviews in new product development

This research examines how organizations can use improvement reviews to enhance learning from product development experiences. We review learning related literature and highlight learning barriers that firms should attempt to minimize when conducting reviews. We then discuss two studies aimed at better understanding the effectiveness of improvement reviews. The first study suggests that improvement reviews can facilitate learning by leading to a reduction in the recurrence of people-related problems, though reviews had no impact on reducing market or product related problems. The second study involved depth interviews with new product developers. Interview comments provide insights into improvement review best practices and shed light on why improvement reviews are sometimes ineffective. A set of managerial recommendations is provided.
The effect of stock price on discretionary disclosure

I examine the impact of exogenous changes in stock prices on voluntary disclosure. Specifically, I investigate whether stock price declines prompt managers to voluntarily disclose firm-value-related information (management forecasts) that was withheld prior to the decline because it was unfavorable but became favorable at a lower stock price. Consistent with my predictions, I find that managers are more likely to release good-news forecasts following larger stock price declines but that there is no association between the likelihood of releasing good-news forecasts and the magnitude of stock price increases. Additional evidence indicates that the good-news forecasts eventually conveyed by withholding firms after negative price shocks would likely have resulted in negative market reactions had they been released before the shocks. More generally, I provide evidence that managers withhold bad news and that exogenous stock price declines can induce its disclosure.
The offshoring of American government

A new reality is emerging in the public sector: state governments are spending an untold amount of tax dollars on public contracts that are performed overseas. Although the private sector has offshored jobs for decades, state governments have only recently become part of the offshoring bandwagon. As media reports of government offshoring increased during the 2004 election, lawmakers in virtually every state introduced legislation to restrict state contractors from performing work outside of the United States. While only few states have imposed restrictions, state lawmakers continue to introduce such legislation today. This Note argues that state offshore contracting restrictions are unconstitutional. In short, the Foreign Commerce Clause of the U.S. Constitution prohibits state governments from regulating international trade and burdening foreign commerce. Through these offshore contracting restrictions, states are discriminating against foreign commerce, thus impairing the federal government's ability to speak with "one voice" in international trade relations. Further, state offshore contracting restrictions intrude on the federal government's exclusive power to conduct foreign relations. Application of these constitutional provisions leads to a curious result: once a state puts a contract in the stream of commerce, it is unable to prevent its contractors from offshoring the contract. After reviewing the costs and benefits of offshore contracting, this Note concludes that the nation must engage in a serious debate about whether to permit states to restrict offshore contracting, given the potential challenges offshoring poses for state governments. Before this debate can occur, however, this Note calls on both the federal and state governments to make a serious commitment to study and identify the issues and implications of offshoring because policy solutions, if any, depend on the availability of offshoring data.
Units of Decision

I shall introduce the units of decision problem in the theory of decision, which as I shall explain is a sibling to the units of selection problem in evolutionary theory. And I shall present an argument to the effect that, contrary to Bayesian wisdom on the subject, undertaking decision in group settings (in multi-individual units) violates no precepts of rationality.
Identity Confidentiality for Women Fleeing Domestic Violence

Victims of domestic violence who try to flee their abusers frequently seek to relocate to confidential locations, changing their name, their address, and their very identity in order to start again free from a life of violence. Helping these women presents a new legal problem: how to resolve the conflict between maintaining publicly accessible records and information and allowing confidential addresses and records for victims of domestic violence who fear being tracked by their abuser. Legislative concerns about fraudulent use of confidentiality programs and custodial interference by women fleeing with their children in violation of a custody order further complicate an already complicated situation, and make an easy solution nearly impossible to find.While escape may be the only way to break free from the cycle of violence for some victims of domestic violence, this solution is imperfect and often only temporary. Advancing internet technologies and the release of personal information by government agencies, courts, and corporations make it easier than ever for an abuser to find and continue to abuse his victim. The problem is further compounded if the woman relocates out-of-state, where the laws protecting her confidentiality may be different and where she may have to reregister - and risk exposure - with the new state's agencies and courts.Statutory solutions require a careful balancing of the privacy needs of relocated victims of domestic violence and maintaining access to public records desired for political accountability. Many states have address confidentiality programs for survivors of domestic violence, but other states still leave the problem unaddressed. Few states address the more complicated problem of interstate relocation or how to register a protective order in a new state while maintaining one's confidentiality, since many states require notice of the registration to the person against whom the protective order is ordered - the abuser. This Note will address this conflict in legal interests. Part II will look at current legal remedies for women seeking to confidentially relocate to flee their abusers, including name change statutes, Public Records exemptions, and Address Confidentiality Programs. Part III will briefly examine the additional obstacles a woman fleeing with her children faces, especially when the abuser has custody rights to the children. Part IV will discuss some of the suggestions for reform propounded by the legal community and make some recommendations based on this Note's analysis of the current state of the law. The Note concludes that states need to consider a more uniform application of the law combined with a more integrated approach to helping victims of domestic violence, particularly those in poverty, relocate to start a new life free from abuse. The use of domestic violence Centers to help victims take advantage of statutory programs and streamline the process of application and use of these programs may serve as a viable starting point for such reform.
Rationing Criminal Defense Entitlements: An Argument From Institutional Design

This essay takes as its premise that the widespread and long-term underfunding of indigent criminal defense is, for practical purposes, a permanent fixture of the political and constitutional landscape. From this assumption, it makes two points, one theoretical, the other practical. The theoretical point is that consistent underfunding of constitutional entitlements can be a legitimate legislative response to judicial specification of constitutional rights. Courts define constitutional rights, but many of those entitlements are unfunded mandates to legislatures. Entitlements such as the right to defense counsel, require money to become reality. Legislatures have responded by underfunding those rights, yet have not specified how limited funds should be allocated—that is, how rights should be rationed. The Supreme Court, in fact, has to a large degree barred legislatures from doing so through constitutional criminal procedure rules. This legislative-judicial dynamic implicitly delegates, largely to defense attorneys but also to trial judges, the task of rationing rights that cannot be implemented as fully as formal judicial pronouncement implies. This ongoing interaction between courts, legislatures and the defense bar (aided by trial judges) looks like a species of Dorf and Sabel’s “democratic experimentalism,” a model that describes a broad array of government actions that define constitutional and sub-constitutional law. Here the twist is that private actors—defense attorneys—have a large hand in constructing the real, working content of constitutional entitlements. Given this weighty task, the essay sketches a set of practical guidelines by which defense counsel and other trial-level actors can most sensibly implement the job of rationing rights that has been delegated to them. This essay proposes a set of default rules grounded on two core principles: priority to factual innocence over other instrumental goals of criminal procedure, and a harm-reduction principle that gives preference to * Associate Professor and Alumni Faculty Fellow, Washington and Lee University School of Law.
U.S. wage growth and nonlinearities: The roles of inflation and unemployment

Abstract Despite a low unemployment rate, wage growth in the U.S. was negligible during the 2013–2015 period. Conventional linear models of the relationship between wages and unemployment, the so-called wage Phillips curve (WPC), and previous models of the WPC that rely on regime-switching driven only by changes in unemployment, provide a poor fit in the aftermath of the Great Recession. Meanwhile, standard linear theoretical general equilibrium models are based on an assumption that economic agents take into account nominal wages relative to prices when making labor decisions, suggesting that there is a role for inflation in determining the empirical dynamics of the WPC. We employ a nonlinear empirical model to study how the relationship between U.S. wage growth and unemployment changes over the business cycle. In particular, we estimate a threshold vector autoregression with multiple threshold variables and multiple threshold parameters for each threshold variable for the 1965–2015 period. We find that the WPC changes according to the dynamics of both unemployment and inflation. Specifically, it changes as the unemployment rate transitions above or below the two estimated thresholds, defined by 5.03% and 7.77%. Simultaneously, it also evolves depending on whether inflation is above or below 0.38% relative to trend. The results show a strong negative relationship between wage growth and unemployment during periods of expansion when inflation is above its long-run trend. The relationship weakens, although remains negative, during periods of expansions with low inflation and during mild recessions. Our results indicate that the negligible wage growth observed during 2013–2015 was driven not only by labor market slack, as suggested by previous studies, but also by the low inflation environment.
Corporate Philanthropy and the Business Benefit: The Need for Clarity

The need for clarity or harmony is the subject of this essay. Part II summarizes a philosophical debate between two scholars on the mission of the corporation. Part III briefly traces the historical development of the relevant principles and Part IV examines the actual philanthropic practices of several large publicly held corporations. Finally, Part V considers the continuing significance of the common law rule in light of these practices and urges support for the ALI proposal.
Teacher characteristics and academic achievement

ABSTRACTIdentifying the impact of teacher characteristics on academic achievement has been a salient and reoccurring topic in education. We employ a twin-by-year identification strategy using matched teacher-student data from North Carolina to credibly estimate the impact of teacher characteristics such as experience, certification, and advanced degrees on academic achievement in math and reading. By using within-family variation the estimates from our model improve upon on earlier work by for time varying unobservable family shocks to non-schooling inputs. Our findings reveal that teacher experience and National Board certification have positive and significant effects on achievement in reading and math; however, we find inconclusive effects for advanced degrees. Notably, we show that teacher experience has the largest effects on student achievement, but our effects are smaller than the standard estimates in the literature. Overall, our estimates provide lower upper bounds for these key teacher character...
The Political Economy of Conditional and Unconditional Foreign Assistance; Grants vs. Loan Rollovers

Improving the effectiveness of financial assistance programs is a priority of international financial institutions (IFIs). This paper examines the effectiveness of alternative assistance instruments in a dynamic political economy framework. Economic policies of the receiving country are distorted by the influence of a domestic interest group. The assistance-providing IFI aims at reducing these distortions. The IFI provides assistance either as grants or loans, and either conditionally on reducing policy distortions or unconditionally. The paper shows that, other things constant, one-time grants are more effective than loan rollovers when assistance is unconditional, but that the opposite is true when assistance is conditional.
The Economic Relevance Of Chief Marketing Officers In Firms’ Top Management Teams

Management theory suggests that the presence of the Chief Marketing Officer in the Top Management Team reflects a corporate emphasis on marketing and customer relations. Finance theory suggests that this emphasis should translate into additional shareholder wealth. However, prior research has failed to document such a relationship. Using performance attribution analysis, the authors construct a long-short portfolio that buys (sells) stocks of firms with (without) a Chief Marketing Officer in the Top Management Team and find this investment strategy would have earned risk-adjusted excess returns of approximately 3%. Additional analyses suggest the value of having a Chief Marketing Officer in the Top Management Team manifests primarily among firms with high operating margin, low asset turnover, high profitability, high R&D intensity and high advertising expenses. The authors conclude that having a Chief Marketing Officer in the Top Management Team has a positive impact on shareholder wealth.