cssi/SciSciGPT-SciSciNet huggingface dataset:
The Fourth Quadrant

This essay makes the case that Internet-based platforms can be evaluated along two dimensions: the first between generative and sterile, indicating openness to further contribution and development from outsiders, and the second between hierarchy and polyarchy, indicating the ease with which those affected by the platform can escape its umbrella. The quadrants formed by these two dimensions can help us to understand patterns in the development of new technologies and platforms, and to brainstorm the widest array of solutions to problems arising under them, particularly problems involving enforcement of regulations against bad actors. Using cybersecurity as a principal example, the essay explains why current national security approaches to Internet vulnerabilities are unduly narrow, and how focusing attention on the "fourth quadrant" can broaden the range of options.
Educational Attainment and Attitudes Towards War in Muslim Countries Contemplating War: The Cases of Jordan, Lebanon, Pakistan, and Turkey

Abstract This study addresses the little understood relationship between educational attainment and public attitudes towards war in four predominantly Muslim countries contemplating war: Jordan, Lebanon, Pakistan, and Turkey. The multivariate analysis using public opinion data suggests that the educational attainment of respondents has no statistically significant association with believing that war is necessary for obtaining justice. In a separate analysis, there is no statistically significant association between educational attainment and believing that UN approval is necessary before using military force to deal with an international threat. This study suggests that there is some validity to concerns raised by the UK's Department for International Development and the United Nations Children's Fund (UNICEF) that education may not be contributing to peaceful conflict resolution.
Preannouncing competitive decisions in oligopoly markets

We examine a duopolistic setting in which firms can preannounce their future competitive decisions before they actually implement them. We show that there is a unique equilibrium in which both firms preannounce and overstate their future actions when uncertainty of demand is low. We find that firms choose higher real actions than the ones they would choose in the absence of preannouncements. Moreover, the real actions of both firms are single-peaked functions of their credibility. In a Cournot market, firms face a prisoner's dilemma in which preannouncing lowers firms' profits. If firms could commit not to preannounce, they would remain silent. In a Bertrand market, firms overstate their future actions to foster collusion.
Corporate Governance and Stockholder Abdication: Missing Factors in Tax Policy Analysis

Policymakers recognize that management's ability to control publicly held corporations can negatively affect corporate productivity because management objectives may differ significantly from the wealth maximization objective of stockholders. Commentators have generally viewed the ability of management to control public corporations as resulting from stockholder abdication. Congress has used the tax system to respond to this problem. At various times, Congress has enacted the capital gains preference, golden parachute tax, greenmail tax, and incentive stock option preference with three goals in mind: (1) to encourage management to adopt objectives consistent with stockholders' objectives, (2) to encourage stockholders to adopt a long-term perspective with respect to their stock ownership, and (3) to discourage management from insulating itself from the discipline of market forces. This article argues that these provisions have been ineffective and in some cases harmful because Congress did not consider that the evil it sought to remedy, stockholder abdication, impairs the effectiveness of these provisions. Preferential rates for long-term capital gains are unproductive because they subsidize inefficient retention of earnings, particularly when the tax rate on capital gains is less than the tax rate on dividends. In addition, the holding period requirement of the capital gains preference does not encourage stockholders to adopt a long-term investment perspective and may create market distortions. Moreover, golden parachute and greenmail taxes harm efficient companies. The golden parachute tax prevents well-managed public companies from discouraging unwanted bids by inefficient companies because the stockholder approval exception is not available to public companies. The greenmail tax discourages profit-maximizing bidders from making hostile bids for inefficient companies and, at the same time, prevents efficient firms from thwarting takeover attempts by inefficient firms. Lastly, evidence about the impact of incentive stock options on corporate performance is mixed.
How to Improve Retail Investor Protection After the Dodd-Frank Wall Street Reform and Consumer Protection Act

The Dodd-Frank Wall Street Reform and Consumer Protection Act gives the Securities and Exchange Commission the authority to deal with two issues especially important to retail investors. First, section 913 requires the SEC to conduct a six-month study on the effectiveness of existing standards of care for broker-dealers and investment advisers and specifically authorizes the SEC to establish a fiduciary duty for brokers and dealers. Second, section 921 grants the SEC the authority to prohibit the use of predispute arbitration agreements that would require investors to arbitrate future disputes arising under the federal securities laws and regulations or the rules of a selfregulatory organization. What has been overlooked in the debate over retail investor protection is the interconnectedness of these two provisions. Debate over retail investor protection after Dodd-Frank must consider these two issues together in order to achieve the goal of better retail investor protection. I make three principal arguments: First, I argue that broker-dealers and investment advisers should be held to standards of care and competence based on professionalism, rather than fiduciary duty. Second, I propose, for adoption by the SEC, federal professional standards of competence and care for broker-dealers and investment advisers. Third, I argue that SEC adoption of standards of care will not create any additional federal remedies for investors because it is unlikely that the U.S. Supreme Court will create a private damages remedy for their breach. If the SEC prohibits mandatory securities arbitration of claims based on federal securities law and SEC and SRO rules, the ability of retail investors, particularly those with small claims, to recover damages for careless and incompetent investment advice may be substantially reduced.
Comparison Utility in a Growth Model

We examine the dynamics of two endogenous-growth modelsin which agents have comparison utility. In the inward-lookingeconomy, individuals care about how their current consumptioncompares with their own past consumption. In the outward-lookingeconomy, they care about how their own consumption compares withother people‘s consumption. In response to a negative shock tocapital, saving and growth will temporarily fall in both of themodels that we consider but will remain constant in a model withstandard preferences. The decline will be smaller in the outward-than in the inward-looking case, but utility will be lower inthe former case because of a negative externality.
Targeted advertising and advertising avoidance

I examine how the increasing ability of firms to target their advertise- ments to particular individuals influences market outcomes when consumers have access to advertising avoidance tools. Today firms possess an unprecedented and rapidly improving ability to discover details about individuals and reach them with advertising based on this information. For instance, as many readers know, an individual's web browsing activities may be tracked via information stored in his browser as long as he "participates" by not regularly deleting it, allowing ads to be customized to him upon visiting a web site. 1 Less well known may be that new technology allows Internet Service Providers (ISPs) to target ads by directly tracking which websites consumers visit, meaning that not participating is not an option for consumers. 2 Similarly,
Is "Diversity" Diverse Enough?

Having survived the latest assault against it in Fisher v. University of Texas, the diversity rationale for affirmative action continues to rule the day in admissions offices across American universities, including law schools. Yet, there is a striking degree of uniformity about what actually constitutes "diversity"; law schools appear to strive for something around 60-70% white students, with the remainder divided fairly evenly among Asian-American, African-American, and Latino/Hispanic students (with a handful of native American students). With the exception of historically Black colleges and universities like Howard, institutions that deviate too much from this conventional view of diversity are commonly assailed for their lack of diversity -- even institutions like UC Berkeley, where whites are not even a majority of the student population. This article examines the costs of such a uniform conception of diversity. As an example, with so many law schools pursuing a small number of native American law applicants, the result is, with a few notable exceptions, student bodies that have a consistently tiny fraction of native Americans (approximately
Justice Breyer's Democratic Pragmatism

There have been many efforts to reconcile judicial review with democratic self-government. Some such efforts attempt to justify judicial review if and to the extent that it promotes self-rule. Active Liberty, by Justice Stephen Breyer, is in this tradition; but it is also marked by a heavy pragmatic orientation, emphasizing as it does the need for close attention to purposes and to the importance of consequences to legal interpretation. Its distinctiveness lies in its effort to forge close connections among three seemingly disparate ideas: a democratic account of judicial review; a purposive understanding of legal texts; and a neo-pragmatic emphasis on consequences. Breyer’s argument is convincing insofar as it challenges “originalist” approach on pragmatic grounds. It is more vulnerable insofar it downplays the inevitable role of judicial discretion in the characterization of purposes and the evaluation of consequences. Those who emphasize consequences, and active liberty, might well end up embracing textualism, or even broad judicial deference to legislative majorities. Moreover, it is not simple to deduce, from the general idea of “active liberty,” concrete conclusions on the issues that concern Breyer, such as affirmative action, campaign finance reform, privacy rights, and commercial advertising. Many competing approaches to these issues, and to interpretation as a whole, can also march proudly under the pragmatic banner. * Karl N. Llewellyn Distinguished Service Professor, Law School and Department of Political Science, University of Chicago Law School. This essay grows out of Cass R. Sunstein, The Philosopher-Justice, The New Republic (Sept. 19, 2005); I have substantially revised and expanded the discussion here, and in some ways the basic orientation has shifted. I am grateful to Adrian Vermeule for extremely valuable comments on a previous draft.
Event Count Models for International Relations: Generalizations and Applications

International relations theorists tend to think in terms of continuous processes. Yet we observe only discrete events, such as wars or alliances, and summarize them in terms of the frequency of occurrence. As such, most empirical analyses in international relations are based on event count variables. Unfortunately, analysts have generally relied on statistical techniques that were designed for continuous data. This mismatch between theory and method has caused bias, inefficiency, and numerous inconsistencies in both theoretical arguments and empirical findings throughout the literature. This article develops a much more powerful approach to modeling and statistical analysis based explicitly on estimating continuous processes from observed event counts. To demonstrate this class of models, I present several new statistical techniques developed for and applied to different areas of international relations. These include the influence of international alliances on the outbreak of war, the contagious process of multilateral economic sanctions, and reciprocity in superpower conflict. I also show how one can extract considerably more information from existing data and relate substantive theory to empirical analyses more explicitly with this approach.
What's mine is mine and what's yours is mine too: Converging U.S. intellectual property exhaustion doctrines

Abstract With the increasing dispersion of intellectual property comes the intellectual property rights owner's continued desire to retain that part of the equation for which the bargain was struck. In terms of patents, the patentee strikes a deal to disclose the invention to the public in exchange for a monopoly over its use for a limited term. Copyright holders contribute their works to the intellectual pool receiving value by sale, lease or license. In 2012–13, the U.S. Supreme Court was tasked with delineating the realms of two intellectual property exhaustion doctrines and answering the question of where to draw the line with regard to an IP owner's ability to control the protected invention or work via patent or copyright, respectively. In one case, the Court permitted the intellectual property owner to restrict a subsequent purchaser's use of the product subject to protection, while in the other case the Court rejected the intellectual property owner's attempt to control the downstream use or resale of the product. This article discusses the relevant intellectual property exhaustion doctrines, analyzes and reconciles the Court's decisions in these cases, and provides guidance for navigating restrictions on use of U.S. protected products and works around the globe.
Dynamical delays between starburst and AGN activity in galaxy nuclei

Observations of active galactic nuclei (AGN) have suggested a possible delay between the peak of star formation (on some scale) and AGN activity. Inefficient fuelling (and/or feedback) from fast stellar winds has been invoked to explain this, but we argue this is unlikely in bright systems accreting primarily cold dense gas. We show that such a delay can arise even in bright quasars for purely dynamical reasons. If some large-scale process produces rapid inflow, smaller scales will quickly become gas dominated. As the gas density peaks, so does the star formation rate (SFR). However, gravitational torques which govern further inflow are relatively inefficient in gas-dominated systems; as more gas is turned into stars, the stars provide an efficient angular momentum sink allowing more rapid inflow. Moreover, the gas provided to the central regions in mergers or strong disc instabilities will typically be ∼100 times larger than that needed to fuel the black hole (BH); the system is effectively in the ‘infinite gas supply’ limit. BH growth can therefore continue for some time while the gas supply exhausts, until it has significantly depleted to the point where the BH is finally ‘starved’. Both of these effects act together with comparable magnitude, and mean that the peak of BH growth can lag the peak in the SFR measured at a given scale by a time-scale corresponding to the gas exhaustion time on that scale (∼10–100 local dynamical times). This predicts that the inferred delay will vary in a specific manner with the radius over which the SFR is measured. We discuss possible implications for the role of AGN feedback in suppressing star formation activity.
Ethics of technology needs more political philosophy

Incorporating considerations of reasonable pluralism, individual agency, and legitimate authority.
Identifying and characterizing transboundary aquifers along the Mexico–US border: An initial assessment

The transboundary nature of water dividing Mexico and the United States (U.S.) transforms the entire border region into an instrument of cooperation, a source of conflict, a national security issue, and an environmental concern. Reasonable data collection and research analysis have been conducted for surface waters by joint governmental institutions and non-governmental bodies. However, with the exception of the U.S. Transboundary Assessment Act Program (TAAP) (focusing on the Hueco Bolson, Mesilla Bolson, San Pedro and Santa Cruz aquifers), there is no comparable research, institutional development, or assessment of transboundary groundwater issues on the frontier. Moreover, data collection and methodologies vary between the two countries, there is no broadly accepted definition of the transboundary nature of an aquifer, and available legal and policy frameworks are constrained by non-hydrological considerations. Hence, there is a conceptual and institutional void regarding transboundary groundwater resources between Mexico and the U.S. The purpose of this paper is to bridge this void and characterize transboundary aquifers on the Mexico–US border. It reviews existing international frameworks for identifying hydrological and social criteria that characterize an aquifer as transboundary. It then assesses data from both countries to propose where and which aquifers could be considered transboundary. Finally, the paper proposes an agenda for assessing Mexico–US transboundary aquifers as a means for improving groundwater management in the border region.
Corporate Courtship Gone Sour: Applying a Bankruptcy Approach to Termination Fee Provisions in Merger and Acquisition Agreements

This paper examines Delaware's judicial treatment of deal protection measures, particularly termination fee provisions. The paper explores the tension between the economic function of these provisions in inducing bidders and potentially compensating them for opportunity and transaction costs in the event of deal termination vs. the ability of large termination fees to constrain and coerce shareholder choice by obligating the target to pay out the fee in the event of a shareholder no vote. In light of these issues, the paper explores the different standards of review that Delaware courts have and could potentially apply in ex post review of agreements containing termination fees. Ultimately, the paper argues that there are sufficient policy justifications to adopt more substantive review of these provisions. In light of several identifiable policy justifications, the paper suggests that a best interest standard that is used by bankruptcy courts in their more substantive review of termination fees in asset purchase agreements be adopted by the Delaware Courts analogously in the mergers and acquisitions context.
Taking People As They Are: Islam As a “Realistic Utopia” in the Political Theory of Sayyid Qutb

This article presents an interpretation of Sayyid Qutb's political theory based on a prominent feature of his thought: the claim that Islamic law and human nature (fitra) are in perfect harmony, and that the demands of Islamic law are easy and painless for ordinary human moral capacities. I argue that Qutb is not only defending Islamic law as true and obligatory, but also as a coherent “realistic utopia”—a normative theory that also contains a psychological account of that theory's feasibility. Qutb's well-known fascination with the earliest generation of Muslims (the salaf) is an integral part of this account that serves two functions: (1) as a model of the feasibility and realism of an ideal Islamic political order, and (2) as a genealogy of the political origins of moral vice in society. Qutb's project is thus an account of exactly why and how Islam requires politics, and how modern humans can be both free and governed.
Explaining the Engenderment and Role of Consumer Ambivalence in E-Commerce

Although trust and distrust are both crucial in online truster-trustee relationships, researchers disagree as to whether trust and distrust are distinct from each other. Given this debate, it is important to consider how distrust could be distinguished from trust. Accordingly, this paper extends the nomological network of distrust and introduces two novel antecedents never introduced in e-commerce literature: situational abnormalities and suspicion. We also propose that trust and distrust coexist in an online e-commerce relationship and can result in ambivalence when they both have high attitudinal values (represented in emotions, beliefs, or behaviours). Using a study of online consumer behaviour with 521 consumers, we largely validated our newly proposed model. We find that situational abnormalities and suspicion are separate, important novel antecedents to distrust. We also examine the effect of ambivalence on the truster’s intentions towards the website and find a small positive effect that increases the user’s intentions towards the website. Finally, we demonstrate the coexistence of trust and distrust as separate constructs, and highlight that distrust has a much larger impact on the truster’s intentions than trust. We conclude with implications to theory and practice, along with a discussion of the limitations and future opportunities.
Does the Market Fixate on Reported Earnings for R&D Firms?

By mandating that research and development (R&D) spending be expensed immediately, Statement of Financial Accounting Standards (SFAS) No. 2 (FASB [1974]) potentially distorts the income statement in the sense that good news (e.g., an increase in pre-R&D earnings concurrent with a larger increase in R&D spending) could translate into reported bad news (i.e., a decline in reported earnings) and vice versa. In this paper, we focus our analysis on a directed sample of firms for which reported earnings are highly distorted by changes in R&D spending, and rely on intraday trading data and event study tests of both stock returns and trading activity (at the time of quarterly earnings announcements) to examine whether the stock market is fixated on reported earnings or whether it attempts to “look beyond” reported earnings by utilizing the information on R&D spending disclosed as part of the earnings announcement. The results suggest that R&D spending information has an effect on trading activity for all trade si...
Is The Pcaob a “Heavily Controlled Component” Of The Sec?: An Essential Question In The Constitutional Controversy

The U.S. Supreme Court recently heard oral arguments in Free Enterprise Fund v. Public Company Accounting Oversight Board, described as “the most important separation-of-powers case regarding the President’s appointment and removal powers to reach the courts in the last 20 years.” Established by Congress as the cornerstone of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley” or the “Act”), the Public Company Accounting Oversight Board (the “PCAOB” or the “Board”) was structured as “a strong, independent board to oversee the conduct of the auditors of public companies.” Its principal mission was to prevent the type of auditing failures that contributed to the scandals at Enron, WorldCom, and numerous other public companies in the period leading up to the passage of the Act.
Proper Motion of the Leo II Dwarf Galaxy Based On Hubble Space Telescope Imaging

This article reports a measurement of the proper motion of Leo II, a dwarf galaxy that is a likely satellite of the Milky Way, based on imaging with the Hubble Space Telescope and Wide Field Camera 3. The measurement uses compact background galaxies as standards of rest in both channels of the camera for two distinct pointings of the telescope, as well as a QSO in one channel for each pointing, resulting in the weighted average of six measurements. The measured proper motion in the the equatorial coordinate system is mas century−1 and in the Galactic coordinate system it is mas century−1. The implied space velocity with respect to the Galactic center is km s−1 or, expressed in Galactocentric radial and tangential components, km s−1. The space velocity implies that the instantaneous orbital inclination is 68°, with a 95% confidence interval of . The measured motion supports the hypothesis that Leo II, Leo IV, Leo V, Crater 2, and the globular cluster Crater fell into the Milky Way as a group.
Institutions, Entrepreneurship, and Post-Soviet Development: An Assessment of Moldova's Entrepreneurial Climate (1991-2009)

This paper explores the relation between Moldova’s institutions, entrepreneurship, and poor economic performance 18 years after socialism. The prevailing local institutions determine the direction of entrepreneurship in society (North, 1990; Baumol, 1990; Olson, 1996; Boettke, 1998). Societies with a mix of institutions favorable to productive entrepreneurship experience sustained growth. Conversely, societies with institutions rewarding unproductive and destructive entrepreneurship experience economic stagnation. Using the conceptual frameworks of new institutional economics, Austrian market process theory, and interviews with local entrepreneurs, I explore the link between Moldova’s institutional context and the local entrepreneurship and underdevelopment. For a better understanding of Moldova’s poor economic performance after socialism, scholars and policy makers must investigate the existing underlying gap between the de jure and the de facto institutional barriers to productive entrepreneurship.
Return Migration and Geography of Innovation in MNEs: A Natural Experiment of On-the-job Learning of Knowledge Production by Local Workers Reporting to Return Migrants

I study whether return migrants facilitate knowledge production by local employees working for them at geographically distant R&D locations. Using unique personnel and patenting data for 1315 employees at the Indian R&D center of a Fortune 500 technology firm, I exploit a natural experiment where the assignment of managers for newly hired college graduates is mandated by rigid HR rules and is uncorrelated to observable characteristics of the graduates. Given this assignment protocol, I find that local employees with returnee managers file disproportionately more US patents. I also find some evidence that return migrants act as a ‘bridge’ to transfer knowledge from the MNE headquarters to the local employees working for them.
Towards Symmetry in the Law of Branding

Companies sometimes want to abandon an old identity and rebrand with a new one. Trademark law probably does not have much to say about rebranding in itself. But we should be careful about how we think about rebranding and other undisclosed source relationships because, if not handled properly, law’s recognition of such techniques could end up reinforcing trademark owners’ ability to deter competition and control free speech.
On Measuring Partisanship in Roll-Call Voting: The U.S. House of Representatives, 1877-1999

On Measuring Partisanship in Roll Call Voting: The U.S. House of Representatives, 1877-1999 We propose a method of assessing party influence, based on a spatial model. Our method provides the first test of whether observed values of the widely-used Rice index of party dissimilarity are consistent with a “partyless” null model. It also avoids problems that beset previous estimators. Substantively, we find evidence of party influence in all but one Congress since 1877. Moreover, our indicator of party pressure is systematically higher for the sorts of roll calls that party theorists believe are more pressured—procedural, organizational and label-defining votes. Our results refute the widespread notion that parties in the House have typically had negligible influence on roll call voting behavior. They also document important changes in party influence associated with the packing of the Rules Committee in 1961 and the procedural reforms of 1973.
The End of Scholarly Bibliography: Reconceptualizing Law Librarianship

The death of Professor Morris L. Cohen raises the question of the future of scholarly bibliography. Has the information revolution with its digitization of data and its facile search engines transformed what once was a respected aspect of scholarship into a pursuit so specialized as to be seen as an antiquarian endeavor? In conjunction with this query, the history and status of law librarians is critically examined.
The Rule of Law for Everyone

The rule of law is the most prominent legitimating slogan of government in the world today, espoused my many leaders (and dissidents) in countries around the world, Western and Non-Western. However, there is no agreement on what it means, and there has been little success in establishing it where it does not already exist. This article considers these issues from a historical perspective, by distinguishing a pre-liberal version of the rule of law from a liberal version of the rule of law. This distinction is then applied to clarify some of the basic issues surrounding the application and implementation of the rule of law.
Strategy and Evolution of Vietnam's China Policy: A Changing Mixture of Pathways

This article examines Vietnam9s strategy toward China since 1990. The study suggests that Vietnam9s China policy has been informed by a changing mix of four different pathways, whose salience depends on the interplay of interest and balance of power among China, America, ASEAN, and Vietnam9s two grand strategic camps and supreme leader.
Governance by the Backdoor: Administrative Law(lessness?) at the FDA

This paper discusses the U.S. Food and Drug Administration’s growing - and in some respects peculiar - reliance on guidance documents. Although only offered as a case study, it poses (without necessarily answering) a number of broader questions that may interest administrative law scholars. For instance, when Congress demanded that the FDA use an abbreviated notice-and-comment process to formulate major guidance documents, did this reflect a throwback to informal legislative rulemaking as originally conceived (and will this new variant also become ossified over time)? Along those lines, if a final nonbinding guidance is no more authoritative than a draft version of that same guidance, then what motivates agencies to abide by this hybridized procedure? Separately, when OMB treats a guidance document as likely to have a significant impact on the economy, might such a finding influence courts when agencies interpose ripeness objections in response to challenges to these purportedly nonlegislative rules? In addition, when Congress specifically has required (sometimes with strict deadlines) or invited an agency to issue guidance, should courts accord interpretations of that statutory provision greater deference than normally granted announcements lacking the force of law? Conversely, in areas where Congress has not specifically called for guidance-making, what does one make of the fact that large and important swaths of the FDA’s activities (e.g., genetically modified foods and prescription drug advertising) depend almost entirely on technically nonbinding announcements, or the fact that a number of the agency’s legislative rules governing other subjects incorporate by reference guidance that it has (or will in the future) issue? Finally, in what respect do threats and offers (in enforcement and licensing contexts) allow agencies to secure “voluntary” adherence to nonbinding guidance (and is this at least preferable to tolerating the use of such informal means of leverage to pursue entirely unannounced policies)?
Expected returns, yield spreads, and asset pricing tests

We construct firm-specific measures of expected equity returns using corporate bond yields, and replace standard ex postaverage returns with our expected-return measures in asset pricing tests. We find that the market beta is significantly priced in the cross section of expected returns. The expected size and value premiums are positive and countercyclical, but there is no evidence of positive expected momentum profits.
Binomial Autoregressive Moving Average Models With an Application to U.S. Recessions

Binary Autoregressive Moving Average (BARMA) models provide a modeling technology for binary time series analogous to the classic Gaussian ARMA models used for continuous data. BARMA models mitigate the curse of dimensionality found in long lag Markov models and allow for non-Markovian persistence. The autopersistence function (APF) and autopersistence graph (APG) provide analogs to the autocorrelation function and correlogram. Parameters of the BARMA model may be estimated by either maximum likelihood or MCMC methods. Application of the BARMA model to U.S. recession data suggests that a BARMA(2, 2) model is superior to traditional Markov models.
Judgmental Forecasting: Cognitive Reflection and Decision Speed

This research analyzes how individual differences affect performance in judgmental time-series forecasting. Decision makers with the ability to balance intuitive judgment with cognitive deliberation, as measured by the cognitive reflection test, tend to have lower forecast errors. This relationship holds when controlling for intelligence. Furthermore, forecast errors increase for very fast or very slow decisions. We provide evidence that forecast performance can be improved by manipulating decision speed.
Reforming the Residential Mortgage-Backed Securities Market

This essay is a lightly-edited version of a talk given at the “Federal Housing Finance Policy, Secondary Mortgage Market Issues: Causes and Cures, Secondary Mortgage Market Reform” symposium at Hamline University School of Law. The issues that we are struggling with now are, in many ways, the equivalent of the issues that we struggled with during the Great Depression: what should housing policy look like and what decisions should be made in the next five years or so to bring us from crisis to stability? In all likelihood our answer to this question will define the housing market for generations. To help answer the question, this essay will proceed as follows. First, it will provide some context for American housing policy discussions. It will then outline three ethics that inform housing policy. The essay will then focus on one of the key issues that we face — what should happen with Fannie and Freddie as they exit conservatorship? It concludes by highlighting some of the other housing finance issues that must be addressed before we can move forward with a coherent plan of reform. These additional issues include, first, what is the future of the 30-year mortgage? Second, what is the fate of the lock-in, whereby a person could get a guaranteed interest rate prior to closing the loan? Third, what is the fate of the low-down-payment mortgage? Fourth, what is the appropriate role of the FHA in the context of the entire housing finance infrastructure, and in relationship to Fannie and Freddie in particular? And finally, how much will we allow the goal of increasing homeownership to impact the design of our housing finance system?
The Socratic Method and the Mathematical Heuristic of George Polya

A number of commentators have observed the decline of the Socratic method. This is unfortunate as the Socratic method can be an effective teaching tool. But this article recognizes that the Socratic method can be monochromatic. This article argues that the Socratic method should not be conceived simply as a method to teach analytic skills. Rather, once learned, it can be a concrete analytic tool for the students to use without the help of professors. In other words, it is an end to itself rather than a means. To do this, we can adopt George Polya's heuristic for teaching mathematical problem solving.
Innovation, product cycle, and asset prices

Abstract This paper constructs a simple endogenous growth model featuring the product cycle, i.e., the transition from monopoly to perfect competition, and studies its implications for both asset market and business cycle statistics. I find that the product cycle is a powerful amplification mechanism; the model incorporating the product cycle is able to generate nearly twice as large an equity premium as the model without the product cycle and, as a result, matches the equity premium data. The current paper thereby contributes to advancing a promising theory on the economic sources of long-run risks, postulating that innovation and R&D cause long-run uncertainties in economic growth.
Probing the Coherence of Solid-State Qubits at Avoided Crossings

The dynamics of solid-state qubits coupled to a bath of nuclear spins at avoided crossings are investigated theoretically and experimentally, uncovering the nature of the decoherence process at clock transition.
Second-Order Perfectionism

In constitutional law, first-order perfectionism represents an effort to cast the Constitution’s ideals in the best constructive light. Ronald Dworkin’s conception of law as “integrity” can be seen as a form of firstorder perfectionism. By contrast, second-order perfectionism attempts to set out an account of constitutional adjudication that is sensitive to the fallibility of federal judges. Originalism is best defended as a form of second-order perfectionism; the same can be said of Thayerism, captured in the view that judges should uphold statutes unless they are unquestionably violative of the Constitution. Minimalism, which calls for narrow, incompletely theorized judgments, is another form of secondorder perfectionism. Whether first-order perfectionism is best, and what kind of second-order perfectionism might be chosen instead, cannot be decided without an appreciation of the characteristics of relevant institutions. Under certain institutional assumptions, originalism is preferable; under other assumptions, first-order perfectionism, Thayerism, or minimalism may be the right approach. Freestanding normative assessments are also inescapable. For example, originalism cannot be evaluated without some kind of assessment of the results that it would produce. These claims have implications for first-order perfectionism of the sort defended by Dworkin and more recently by James Fleming. * Karl N. Llewellyn Distinguished Service Professor, Law School and Department of Political Science, University of Chicago. This essay is prepared for a symposium at Fordham Law School on James Fleming, Securing Constitutional Democracy (2006), and Cass R. Sunstein, Radicals in Robes (2006). I am grateful to Abner Greene and Brian Leiter for valuable comments on a previous draft.
In Rem Alternatives to Extradition for Money Laundering

This paper reviews the scope of the problems caused by money laundering activities of organized crime - problems that have rendered extradition an essentially useless tool of law enforcement and that leave in rem approaches as the only viable method of combating transnational criminal conduct that can be effected by the push of a button and the consequent flow of electrons. The paper then reviews the international and U.S. domestic legal regimes relating to asset forfeiture (including a variety of multilateral and bilateral conventions, initiatives such as the Financial Action Task Force under the aegis of the OECD, similar initiatives in Europe and the Caribbean, and such U.S. statutes as the Bank Secrecy Act, the Money Laundering Control Act, the Crime Control Act, the Annunzio-Wylie Anti-Money Laundering Act, and the USA PATRIOT Act). After identifying the strengths and weaknesses of those regimes, the paper outlines the advantages value confiscation regimes enjoy over object confiscation regimes and offers a few modest suggestions for shoring up obvious weaknesses.
Deficits, Public Debt Dynamics and Tax and Spending Multipliers

Cutting government spending can increase the budget defi cit at zero interest rates according to a standard New Keynesian model, calibrated with Bayesian methods. Similarly, increasing sales taxes can increase the budget defi cit rather than reduce it. Both results suggest limitations of “austerity measures.” At zero interest rates, running budget defi cits can be either expansionary or contractionary depending on how they interact with expectations about long-run taxes and spending. The effect of fi scal policy action is thus highly dependent on the policy regime. A successful stimulus, therefore, needs to specify how the budget is managed, not only in the short but also in the medium and long runs.
Cross-Sectional PEG Ratios, Market Equity Premium, and Macroeconomic Activity:

This article explores the information content of PEG ratios (price/earnings to growth ratios) for future aggregate returns and economic fundamentals. We first establish an analytic link between PEG...
Stability in consumer credit scores: Level and direction of FICO score drift as a precursor to mortgage default and prepayment

Abstract This article represents an extension of the expansive credit risk and credit migration literature, prominent in the corporate bond and securities risk pricing literature, to an analysis of the drift of consumer credit scores. A rich data set of residential mortgages is used to observe credit score migration post loan origination and in a test of the ability of credit score transition to serve as a precursor to potential default and prepayment. The results indicate credit scores provide signals and information to investors and servicing agents in a fashion similar to credit ratings on commercial paper as to default potential.
General Relativistic Effects in the Neutrino-driven Wind and r-Process Nucleosynthesis

We discuss general relativistic effects in the steady state neutrino-driven "wind" that may arise from nascent neutron stars. In particular, we generalize previous analytic estimates of the entropy per baryon S, the mass outflow rate , and the dynamical expansion timescale τdyn. We show that S increases and τdyn decreases with increasing values of the mass-to-radius ratio describing the supernova core. Both of these trends indicate that a more compact core will lead to a higher number of neutrons per seed nucleus. Such an enhancement in the neutron/seed ratio may be required for successful r-process nucleosynthesis in neutrino-heated supernova ejecta.
Remittances over the business cycle: Theory and evidence

We examine the behaviour of remittances over the business cycle and their potential to act as a ‘stabilizer’ during periods of high business cycle volatility. Two main findings are reported. First, remittances are less volatile than other foreign currency flows and do not appear to systemically comove with business cycle fluctuations. Second, remittances are relatively stable even during episodes of sharp business cycle volatility, such as those associated with sudden stops and financial crises. We also provide an overview of the theoretical literature on the implications of different motives to remit for the cyclical behaviour of remittances.
The childcare system in France: a glance at the 2003 reform

During the annual family conference on the 29th of April 2003, the French Minister of Family Affairs announced the suggested reforms to the childcare system. Nursery schools accommodate most of the three-year olds for free, but what are the solutions available to working parents of children under-three? This issue is very important in terms of women’s integration on the labour market and more generally their role in tomorrow’s society.
Chaos, sunspots and automatic stabilizers

Abstract We consider a real business cycle model with an externality in production. Depending on parameter values, the model has sunspot equilibria, cyclical and chaotic equilibria, and equilibria with deterministic or stochastic regime switching. We study the implications of this model environment for automatic stabilizer tax systems. Stabilization is desirable because the efficient allocations are characterized by constant employment and output growth. We identify an automatic stabilizer income tax-subsidy schedule with two properties: (i) it specifies the tax rate to be an increasing function of aggregate employment, and (ii) earnings are subsidized when aggregate employment is at its efficient level. The first feature eliminates inefficient, fluctuating equilibria, while the second induces agents to internalize the externality.
Do Boumediene Rights Expire

In recent weeks, a dispute has developed between the Obama Administration and lawyers representing detainees housed at the U.S. facility in Guantanamo Bay, Cuba. In court filings, the government suggested that, once a habeas corpus case has terminated adversely to a detainee, the detainee’s lawyers may no longer access classified information or meet with their clients on the same terms that were allowed during the proceedings.1 Though the district court summarily rejected the government’s position,2 this seemingly minor dispute is just the tip of the iceberg. As Guantanamo detainees’ first round of habeas cases come to an end, and as the U.S military deployment in Afghanistan reaches its denouement, the courts will have to address the much bigger issue of whether Boumediene v. Bush3 granted rights to Guantanamo detainees that have now expired. In Boumediene, the Supreme Court held that Guantanamo detainees had a constitutional right to habeas corpus review to determine whether they were properly held as enemy combatants, even though the detainees were noncitizens imprisoned outside the sovereign territory of the United
Labor Market Concentration

A product market is concentrated when a few firms dominate the market. Similarly, a labor market is concentrated when a few firms dominate hiring in the market. Using data from the leading employment website CareerBuilder.com, we calculate labor market concentration for over 8,000 geographic-occupational labor markets in the US. Based on the DOJ-FTC horizontal merger guidelines, the average market is highly concentrated. Using a panel IV regression, we show that going from the 25th percentile to the 75th percentile in concentration is associated with a 17% decline in posted wages, suggesting that concentration increases labor market power.
Surviving the gales of creative destruction: the determinants of product turnover

Innovative industries are often characterized by rapid product turnover. Product longevity may be driven by both a product's position within a market as well as its position within a firm's larger product portfolio. However, we have little understanding of the relative importance of these factors in determining product turnover and how they interact as an industry evolves. Although researchers have invested substantial effort in analyzing firm survival and turnover, there are far fewer studies of the determinants of product survival and turnover. We use hazard rate models and count regression models to describe the behavior of firms and their products with a new and detailed database on the laser printer industry. We show, first, that competition and market structure variables have a large impact on both speeding product exit and delaying product entry. Second, there is some evidence that firms that have maintained a high market share for a number of years keep their products on the market longer than those with lower market share. Finally, firms with high innovative capacity tend to enter markets frequently, but withdraw their products at average rates. Firms with strong brands tend to introduce few products and withdraw their products slowly. With these findings, the paper links product entry and exit decisions to the broader literature on firm strategic and product management. Copyright © 2006 John Wiley & Sons, Ltd.
The World Economy at the End of the Millennium

The paper examines the rise fall and rise of the Liberal International Economic Order over the last 150 years, and critically examines the various hopes and fears in developed and developing countries that this most recent global integration is raising. JEL classification: F02, A13, N70, P16. Address: Dept. of Economics, UCLA, 405 Hilgard Ave., Los Angeles, CA 90024 Tel.: 310-825 4521 Fax.: 310-825 9528 e-mail: dlal@ucla.edu FINAL REVISE September 1998