cssi/SciSciGPT-SciSciNet huggingface dataset:
Corporate governance and the cost of debt: Evidence from director limited liability and indemnification provisions

We find that firms that provide limited liability and indemnification for their directors enjoy higher credit ratings and lower yield spreads. We argue that such provisions insulate corporate directors from the discipline from potential litigation, and allow them to pursue their own interests by adopting low-risk, self-serving operating strategies, which coincidentally redound to the benefit of corporate bondholders. Our evidence further suggests that the reduction in the cost of debt may offset the costs of directorial shirking and suboptimal corporate policies occasioned by this insulation, which may explain why stockholders have little incentive to rescind these legal protections.
Pork-Barrel Spending and State Employment Levels: Do Targeted National Expenditures Increase State Employment in the Long Run?

A targeted national expenditure, also known as pork-barrel spending, is defined as federal project which is funded by the national tax base yet only benefits a small, localized population. Anecdotally, this type of spending is often criticized as short-sighted, inefficient and wasteful. This paper incorporates pork-barrel spending into existing research on the drivers of state economic growth to determine the role of pork-barrel spending on both state employment and gross state product. First, I find that many of the initial-year economic conditions that drive employment in MSAs also drive employment at the state-level. Second, I find that pork-barrel spending also influences employment levels, but the effect tends to be temporary. Specifically, for every one million dollars of pork-barrel appropriated by a state, total employment in the state increases by around 735 jobs in the year the funding is secured. However, less than 100 of those jobs remain the following year. This gives credibility to the argument that pork-barrel spending is used to support short-sighted political goals such as re-election. Finally, using a spatial lag model, I find that the benefits of pork-barrel spending do not spill across state lines providing evidence that pork-barrel spending only benefits a concentrated population.
Complementary Alternative Benefits to Promote Peace.

Recent research has focused on business as a mediating institution that can influence society while engaging in the traditional profit-making and value generation functions. This work includes Professors Fort’s and Schipani’s arguments about how business may be able to play a role in promoting more peaceful societies, and other research addressing how businesses might serve a role in reducing violence in society and the workplace. Although there is a significant body of scholarship on the role of business in reducing violence in society, there is little research on concrete steps for businesses to take to achieve this goal. This article attempts to begin to fill that void. As identified by Fort and Schipani, business may promote more peaceful societies by encouraging a sense of community. We argue that one way to reach that goal is for business to provide what we denote as complementary alternative benefits (CABs), to its workforce. In this article, we advocate for businesses to offer CABs which focus on sustaining the health, reducing the stress, and improving the camaraderie of its workforce. We argue that business can use these benefits to promote a healthy, less-stressed, and collegial workforce that is less prone to resolve conflicts by violence. Further, we examine the role business plays in promoting more peaceful societies and how employer-initiated stress reduction programs are consistent with both business ethics and peace-building principles. Finally, using case studies we demonstrate how CABs may also reduce costs related to absenteeism and turnover, and thus improve the bottom line.
Power, Authority and International Investment Law

International investment law stabilizes investment participants' behavior and expectations and investment outcomes. This law controls global decision-making by modulating power and authority between participants through four processes: (1) triggering shifts in power and authority; (2) draining power and authority from states; (3) transferring this power and authority to other decision-makers; and (4) restoring state power and authority. Some policy-makers in both powerful and less powerful states regard these shifts in power and authority as unjustified attacks on sovereignty. To minimize these policy-makers' concerns, this article recommends modifications to international investment law that will promote global well-being further.
The Revenge of Distance: Vulnerability Analysis of Critical Information Infrastructure

The events of 11 September 2001 brought an increased focus on security in the United States and specifically the protection of critical infrastructure. Critical infrastructure encompasses a wide array of physical assets such as the electric power grid, telecommunications, oil and gas pipelines, transportation networks and computer data networks. This paper will focus on computer data networks and the spatial implications of their susceptibility to targeted attacks. Utilising a database of national data carriers, simulations will be run to determine the repercussions of targeted attacks and what the relative merits of different methods of identifying critical nodes are. This analysis will include comparison of current methods employed in vulnerability analysis with spatially constructed methods incorporating regional and distance variables. In addition to vulnerability analysis a method will be proposed to analyse the fusion of physical and logical networks, and will discuss what new avenues this approach reveals. The analysis concludes that spatial information networks are vulnerable to targeted attacks and algorithms based on distance metrics do a better job of identifying critical nodes than classic accessibility indexes. The results of the analysis are placed in the context of public policy posing the question do private infrastructure owners have sufficient incentives to remedy vulnerabilities in critical networks.
Short Run Constraints and the Increasing Marginal Value of Time in Recreation

Leisure activities such as local recreation trips usually take place in discrete blocks of time that are surrounded by time devoted to other commitments. It can be costly to transfer time between blocks to allow for longer outings. These observations affect the value of time within those blocks and suggest that traditional methods for valuing time using labor markets miss important considerations. This paper presents a new model for time valuation that uses non-employment time commitments to infer the shadow value of time spent in recreation. A unique survey that elicited revealed and stated preference data on household time allocation is used to implement the model. The results support the conclusion that there is an increasing marginal value of time for recreation as the trip length increases.
The Affordable Care Act, Dependent Health Insurance Coverage, and Young Adults' Health

This study examines the consequences of the Patient Protection and Affordable Care Act (ACA) dependent coverage provision for the health of U.S. young adults aged\–25. Using data from the Current Population Survey—March Supplement for the years 2007–2012 and ordered logistic regression analyses, we examine self-rated health and its association with dependent health insurance coverage for 19- to 25-year-olds and a comparison group of 28- to 34-year-olds before and after implementation of the ACA. Compared to 28- to 34-year-olds, results indicate the post-ACA period (2010–2011) is associated with increased access to dependent health insurance coverage and improved health for young adults aged 19–25 relative to the period before implementation (2008–2009). More than half of the difference in health improvement across age groups can be attributed to changes in dependent coverage. These results are the first to demonstrate a positive health benefit resulting from the implementation of the ACA.
Whistleblowing on Fraud for Pay: Can I Trust You?

ABSTRACT: The SEC whistleblower bounty program's effectiveness in increasing external reports of illegal acts suggests that employers might increase internal whistleblowing by offering monetary awa...
Locally Elected Sheriffs and Money Compensation A Quantitative Analysis of Organizational and Environmental Contingency Explanations

This study uses OLS and a large sample of U.S. counties to empirically assess diverse explanations for pay allocated to local sheriffs. After statistically holding constant effects of agency size and functional specialization, including jail operations, this study isolates diverse environmental sources of variation in money wages allocated to the elected sheriff. A strong tax base helps local sheriffs, as does income inequality associated with the presence of high income earners, but local conservative political support is associated with reduced wage allocations. High crime rates and local unemployment are closely associated with expanded money wages, but pay is limited in counties with a large impoverished population. The empirical results are consistent with an environmental contingency model. One implication from this analysis is that county sheriffs are compensated at rates that reflect patterns of uncertainty in the organization's localized external environment.
The Salish Sea Boundary Straits: “Historic Internal Waters” or Territorial Seas?

The legal classification of the boundary straits of the Salish Sea between the western United States and Canada as either historic internal waters or territorial seas, subject to a right of innocen...
Pricing a contingent claim liability with transaction costs using asymptotic analysis for optimal investment

We price a contingent claim liability (claim for short) using a utility indifference argument. We consider an agent with exponential utility, who invests in a stock and a money market account with the goal of maximizing the utility of his investment at the final time T in the presence of a proportional transaction cost e>0 in two cases: with and without a claim. Using the heuristic computations of Whalley and Wilmott (Math. Finance 7:307–324, 1997), under suitable technical conditions, we provide a rigorous derivation of the asymptotic expansion of the value function in powers of $\varepsilon^{\frac{1}{3}}$ in both cases with and without a claim. Additionally, using the utility indifference method, we derive the price of the claim at the leading order of $\varepsilon^{\frac{2}{3}}$ . In both cases, we also obtain a “nearly optimal” strategy, whose expected utility asymptotically matches the leading terms of the value function. We also present an example of how this methodology can be used to price more exotic barrier-type contingent claims.
Bricks Plus Bytes: How Click-and-Brick Will Define Legal Education Space

Examining a number of technological, commercial and professional scenarios the author argues that the law school of the near future must become a hybrid place, what is known in ecommerce as a "click-and-brick" or "click-and-mortar." In a click-and-brick law school distributive-learning techniques will fill much of the space, supplementing traditional class experiences and substituting for many of them. But a true click-and-brick will also integrate distance learning (or distance education) methodologies, reaching out to remote students, enabling collaboration with off-campus faculty and consuming remote content. The article examines the qualitative and institutional arguments frequently raised against such non-traditional legal education and argues that the traditional law school model will be substantially altered not only because of the implications of the new enabling technologies but because law school space is no longer a self-contained autonomous, insulated environment. The article examines how a sustainable click-and-brick model for legal education will involve significant re-engineering of virtual and physical law school space, a re-engineering that must be cognizant of the ways in which law practice is being reshaped and how the law school curriculum will require major re-tooling to be relevant to the Information Age.
Base Erosion and Profit Shifting: A Simple Conceptual Framework

The issue of tax-motivated income shifting within multinational firms – or “base erosion and profit shifting” (BEPS) – has attracted increasing global attention and has become the subject of an ongoing OECD initiative. This paper provides a simple conceptual framework that helps to clarify aspects of governments’ responses to the BEPS phenomenon and the potential role of the OECD initiative. An important implication of this framework is that multilateral cooperation of the type envisaged in the BEPS initiative has the potential to reduce the deadweight costs of MNCs’ tax planning and compliance activities, thereby enhancing global welfare.
A Dynamic Inventory Model with the Right of Refusal

We consider a dynamic inventory (production) model with general convex order (production) costs and excess demand that can be accepted or refused by the firm. Excess demand that is accepted is backlogged and results in a backlog cost whereas demand that is refused results in a lost sales charge. Endogenizing the sales decision is appropriate in the presence of general convex order costs so that the firm is not forced to backlog a unit whose subsequent satisfaction would reduce total profits. In each period, the firm must determine the optimal order and sales strategy. We show that the optimal policy is characterized by an optimal buy-up-to level that increases with the initial inventory level and an order quantity that decreases with the initial inventory level. More importantly, we show the optimal sales strategy is characterized by a critical threshold, a backlog limit, that dictates when to stop selling. This threshold is independent of the initial inventory level and the amount purchased. We investigate various properties of this new policy. As demand stochastically increases, the amount purchased increases but the amount backlogged decreases, reflecting a shift in the way excess demand is managed. We develop two regularity conditions, one that ensures some backlogs are allowed in each period, and another that ensures the amount backlogged is nondecreasing in the length of the planning horizon. We illustrate the buy-up-to levels in our model are bounded above by buy-up-to levels from the pure lost sales and pure backlogging models. We explore additional extensions using numerical experiments.
Competing Theories of Blackmail: An Empirical Research Critique of Criminal Law Theory

The crime of blackmail has risen to national media attention because of the David Letterman case, but this wonderfully curious offense has long been the favorite of clever criminal law theorists. It criminalizes the threat to do something that would not be criminal if one did it. There exists a rich literature on the issue, with many prominent legal scholars offering their accounts. Each theorist has his own explanation as to why the blackmail offense exists. Most theories seek to justify the position that blackmail is a moral wrong and claim to offer an account that reflects widely shared moral intuitions. But the theories make widely varying assertions about what those shared intuitions are, while also lacking any evidence to support the assertions. This Article summarizes the results of an empirical study designed to test the competing theories of blackmail to see which best accords with prevailing sentiment. Using a variety of scenarios designed to isolate and test the various criteria different theorists have put forth as “the” key to blackmail, this study reveals which (if any) of the various theories of blackmail proposed to date truly reflects laypeople’s moral judgment. Blackmail is not only a common subject of scholarly theorizing but also a common object of criminal prohibition. Every American jurisdiction criminalizes blackmail, although there is considerable variation in its formulation. The Article reviews the American statutes and describes the three general approaches these provisions reflect. The empirical study of lay intuitions also allows an assessment of which of these statutory approaches
DYNAMICALLY INTEGRATING KNOWLEDGE IN TEAMS: TRANSFORMING RESOURCES INTO PERFORMANCE

In knowledge-based environments, teams must develop a systematic approach to integrating knowledge resources throughout the course of projects in order to perform effectively. Yet many teams fail t...
Changes, Anticipations, and Reparations

Conventional views of legal change emphasize the values of certainty and reliance, and are therefore hostile to explicitly retroactive laws. Contemporary scholarship, however, allows that a policy of aggressive legal change, with no compensation for "new losers," can encourage socially useful steps in anticipation of change. Professor Levmore argues that the anticipation-oriented approach logically extends to embrace anticipation by "new winners" and governments as well as new losers. If all parties' anticipatory incentives are considered, familiar rules, ranging from statutes of limitations to retroactivity and to compensatory payments for government takings, seem quite sensible. And if these rules are drawn correctly, few parties should find it worthwhile to stand against progress. Professor Levmore then considers reparations. He argues that these payments by governments are made when the potential anticipation effects normally associated with retroactive compensation are absent. The transfers are then redistributive and best understood through interest group analysis.
The Impact of Graphical Displays of Pro Forma Earnings Information on Professional and Nonprofessional Investors' Earnings Judgments

ABSTRACT: Regulation G (SEC 2003b) requires managers to reconcile textual non-GAAP performance measures (i.e., pro forma disclosures) to GAAP. Graphical disclosures also require reconciliation; however, neither the format nor the placement of the reconciliation is specified. We apply cognitive fit theory to argue that the influence of graphical information presentation formats is contingent on investor type and judgment complexity. Participants in our study viewed a simulated Investor Relations website for a large drug retailer and made judgments regarding current fiscal year earnings performance, earnings potential, and investment amount. We manipulated graphical (GAAP-only versus GAAP and pro forma) and textual (GAAP-only versus pro forma reconciled to GAAP) earnings disclosure content in a 2 × 2 between-participants design. We find that nonprofessional investors' current fiscal year earnings performance, earnings potential, and investment amount judgments are all influenced by graphical displays, which...
Financing Efficiency of Securities-Based Crowdfunding

We analyze early-venture fundraising from dispersed, endogenously informed investors. An entrepreneur chooses a payoff-maximizing offering, and investors communicate their information by either contributing capital or abstaining. The entrepreneur uses the information conveyed by fundraising amounts to decide whether or not to undertake a risky venture. His decision threshold hedges investors against bad projects, creating a “loser’s blessing” that encourages contributing without information. Making the offering less attractive to investors mitigates the loser’s blessing but can give rise to a winner’s curse. Both tensions reduce financing efficiency.Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
VALUING AND NURTURING MULTIPLE INTELLIGENCES IN LEGAL EDUCATION: A PARADIGM SHIFT

This article is based on Harvard educational psychologist Howard Gardner's theory of Multiple Intelligences (MI), first proposed in his 1983 text Frames of Mind. Gardner conceived his work as a new theory of human intellectual competences to challenge the classical view of intelligence as embodied by the Binet I.Q. test. Under this traditional view, intelligence has been viewed as a single faculty that can be measured by a number, so that a person is "smart" or "stupid" across the board. Gardner tried to devise a rubric that was more inclusive of human gifts The thesis of the article is that using MI theory to take a new, more expansive approach to recognizing and evaluating student capabilities could help us to provide a better legal education in several arenas. The article begins by describing traditional intelligence theory and how Gardner redefined it. It then explores Gardner's nine designated intelligences and how each of them might contribute to successful lawyering. Finally, it identifies four realms of legal education: admissions, pedagogy, evaluation, and career mentoring; and discusses how MI theory could be employed both to make law school more inclusive for female, minority, and "non-traditional" law students and also to render an overall learning environment that fosters the wide array of skills and talents practicing lawyers need in today's competitive environment.
Original Misunderstandings: The Implications of Misreading History in Jones

This article shines light on a little-noticed but important error in United States v. Jones, the recent Supreme Court Fourth Amendment decision. In Jones, the majority opinion and Justice Alito’s concurrence quibble whether the majority applies “18th-century tort law” in holding that the government’s trespass constitutes a search. Both opinions mistakenly assert that any unwanted intrusion on private property was actionable at common law. While true in England, the American law of trespass provided no remedy for unwanted intrusions to unfenced land. Current Supreme Court Fourth Amendment jurisprudence recognizes the open fields doctrine, which allows the government to search open land without a warrant. There is little indication at present that the Supreme Court or any other court wants to overrule the doctrine, so the Justices’ nonchalant approach to history could be of no import to the scope of the Fourth Amendment. But the error could have a serious impact on property law. In recent years, the Supreme Court has exhibited a healthy appetite to both expanding the regulatory takings doctrine and imposing a judicial takings doctrine based on historical nonsense. * Scholar in Residence, Emory Law School. I would like to thank Brandon Garrett, David Gray, Lee Kovarsky, and Seth Tillman for their comments. I would like to thank Alyse Prawde for her invaluable assistance. 1 Sawers: Original Misunderstandings: The Implications of Misreading Histor Published by Reading Room, 2014 472 GEORGIA STATE UNIVERSITY LAW REVIEW [Vol. 31:3
Determinants of Corporate Bond Trading: A Comprehensive Analysis.

This paper studies the determinants of trading volume and liquidity of corporate bonds. Using transactions data from a comprehensive dataset of insurance company trades, our analysis covers more than 17,000 US corporate bonds of 4,151 companies over a five-year period prior to the introduction of TRACE. Our transactions data show that a variety of issue- and issuer-specific characteristics impact corporate bond liquidity. Among these, the most economically important determinants of bond trading volume are the bond’s issue size and age — trading volume declines substantially as bonds become seasoned and are absorbed into less active portfolios. Stock-level activity also impacts bond trading volume. Bonds of companies with publicly traded equity are more likely to trade than those with private equity. Further, public companies with more active stocks have more actively traded bonds. Finally, we show that while the liquidity of high-yield bonds is more affected by credit risk, interest-rate risk is more important in determining the liquidity of investment-grade bonds.
Affirmative Action and Texas' Ten Percent Solution: Improving Diversity and Quality

As the federal courts become increasingly hostile to traditional affirmative action programs in higher education, it appears that racial diversity at colleges and universities will suffer. Indeed, in the wake of Hopwood v. Texas' in the U.S. Court of Appeals for the Fifth Circuit, minority enrollment at the University of Texas School of Law declined dramatically. Progress toward a more integrated society may not only be slowed but even reversed. This conservative shift in public policy may have a surprisingly radical effect, however. As universities in Texas and other states search for legally acceptable alternatives to the rejected affirmative action programs, they may end up with approaches that are less effective at promoting racial diversity in the short run but that may prove equally effective in the long run. By generating unexpected benefits for another critical problem in the United States -- the poor quality of many primary and secondary public schools -- the alternative approaches may do as much as traditional affirmative action programs to overcome some of the causes for lower academic achievement by minorities. In this article, I focus on one alternative approach that holds considerable promise. In 1997, the Texas legislature ordered each of the state's public undergraduate institutions to admit all applicants whose grade point averages were in the top ten percent of their high school's graduating class. This strategy has been touted for its ability to encourage minority enrollment from high schools that have an overwhelmingly minority student body. What has gone unnoticed is the fact that the approach may do much to improve the public primary and secondary schools by altering incentives for school quality. Current incentives encourage politically influential parents of school-age children to prefer a two-tiered educational system in which their children attend the stronger schools and the children of politically weak parents attend the poorer schools. Under the Texas approach, parents have less to gain from concentrating their children at stronger schools and more to gain from dispersing their children over a larger number of schools. Accordingly, Texas' ten percent policy may lead to a public school system with smaller disparities in quality from school to school.
A Moment of Time: Reliability in Route Choice Using Stated Preference

Understanding how reliability is valued is important because it provides insight into how aims of policies that aspire to provide better transport options can be more fully integrated with user expectations. Better reliability is a desired outcome of transportation policies because it reduces scheduling costs. This study uses a stated preference survey to collect route preference data, in which each route is described by the travel time experience on it. Because travel-time decisions are made from momentary recollections of past experience, the paradigm adopted in this study is that the mode travel time rather than the mean is the important basis for travel time decisions. The authors then explore three alternate measures of reliability and use them to estimate route choice models on the basis of the stated preference data. Two of the measures, range coupled with lateness probability and standard deviation, have been explored before. A third measure based on time moment (moments of inertia) measured from the mode travel time is also proposed and tested. Each measure reveals something different about how people value different aspects of reliability. In all cases, reliability is valued highly, although differently depending on how it is defined. The values of reliability and travel time highlight that transportation policy makers can provide significant benefits to users from strategies that seek to increase reliability.
Supply Chain Strategy in Nascent Markets: The Role of Supply Chain Development in the Commercialization Process

Research on supply chain strategy has emphasized the importance of ensuring the supply chain for a product is appropriately aligned with the characteristics of that product and the market for which it is intended. The current study synthesizes theory from supply chain management, entrepreneurship, and marketing, and examines the results from a case study of multiple supply chains that were formed to launch products based on disruptive innovations to propose new theoretical perspectives on the development of supply chain strategy in this unique market context. The results suggest that legitimacy and value proposition definition and refinement are the initial primary drivers of supply chain strategy and the specific means by which the initial supply chain is formed and structured to achieve successful commercialization. These findings advance theory in both supply chain management and entrepreneurship as well as provide insight to firms seeking to commercialize potentially disruptive innovations.
The choice of equity selling mechanisms: PIPEs versus SEOs

Abstract We examine the firm's choice between an SEO and a PIPE, an innovation in follow-on equity selling mechanism seen in the late 1990s. Our primary finding indicates that the rapid rise of the PIPE market fills the capital needs of firms which may not have access to more traditional alternatives. This lack of access is driven mainly by information asymmetry and weak operating performance. We also show that firms are more likely to choose PIPEs when the general market and the firm's stock are performing poorly. Furthermore, we find that selected firms with access to the public market may prefer a PIPE due to specific cost considerations.
Metaphors, Models & Theories

Theories deal with the world on its own terms, absolutely. Models are metaphors, relative descriptions of the object of their attention that compare it to something similar already better understood via theories. Models are reductions in dimensionality that always simplify and sweep dirt under the rug. Theories tell you what something is. Models tell you merely what something is partially like.
Operating And Earnings Performance Of Quality Certified Listed Firms

With a large number of US firms, obtaining the ISO 9000 quality certification, this article attempts to investigate the impact of the certification on operating and financial performance. Our results indicate the benefits of the certification may be limited and may depend on the time period in consideration, and the sample of firms used for comparing firm performance. Also investors usually do not perceive the ISO certified firms to have a higher quality of earnings and not willing to pay more for earnings from such firms.
Recovering the Legal History of the Confederacy

Although the government of the Confederate States of America has been formally treated as a legal nullity since 1878, from February, 1861 to April, 1865 the Confederacy was a real government, with a Constitution, a Congress, district courts, and administrative offices. This Article seeks to recover the legal order of the Confederacy in its robust state, before the prospect of its obliteration came to pass. The Article explores the question why certain southern states would have considered seceding from the United States, and forming a separate nation, in late 1860 and early 1861. It then turns to the legal order of the Confederacy that was erected after secession. It focuses on two characteristics of that legal order: its architecture, including the drafting of the Confederate Constitution, the establishment of Confederate district courts, and the failure of the Confederate Congress to organize a Supreme Court for the Confederacy; and the central legal issues with which the Confederate government was preoccupied. The Article concludes that in the minds of contemporaries, the outcome of the Civil War and the dissolution of the Confederacy that accompanied it represented a transformative phase in American history, in which the way of life that the Confederacy symbolized was confined to oblivion.
Deadlines and infrequent monitoring in the dynamic provision of public goods

Abstract We consider a dynamic game of private provision of a discrete public good. In our model, a group of agents contributes to a project over time, which is completed once the cumulative contributions reach a threshold. Provided that this occurs prior to a prespecified deadline, each agent receives a lump-sum payoff. We show that a shorter deadline can induce the agents to raise their efforts, but no matter the length of the deadline, effort provision is inefficient due to the agents' frontloading incentives. Only if the agents do not monitor progress until the deadline are their frontloading incentives eliminated, so by committing to a deadline equal to the first-best completion time, it is possible to restore efficiency. Recognizing that deadlines are not renegotiation proof, we show that by committing to monitor progress to date at the first-best completion time, and then again at a sufficiently later date, efficiency can be attained. In this case, that monitoring date acts as a self-enforcing deadline.
ADVERSE SELECTION IN ELECTRONIC MARKETS: EVIDENCE FROM ONLINE STAMP AUCTIONS

We analyze adverse selection costs in online stamp auctions, based on a comparison of prices on eBay with those of matched stamps at a specialty stamps auction site in the U.S., Michael Rogers, Inc. (MR), which we know a priori has low quality uncertainty. We find that buyer prices are 10–15% lower on eBay as compared to MR, and the price difference, increases with the value of the stamps. Consistent with this adverse selection discount we find that the seller reputation mechanism on eBay has an economically modest, although statistically significant, effect on auction price and probability of sale.
Institutional Ownership and Corporate Tax Avoidance: New Evidence

ABSTRACT: We provide new evidence on the agency theory of corporate tax avoidance (Slemrod 2004; Crocker and Slemrod 2005; Chen and Chu 2005) by showing that increases in institutional ownership are associated with increases in tax avoidance. Using the Russell index reconstitution setting to isolate exogenous shocks to institutional ownership, and a regression discontinuity design that facilitates sharper identification of treatment effects, we find a significant and discontinuous increase in tax avoidance following Russell 2000 inclusion. The tax avoidance involves the use of tax shelters, and immediate benefits include higher profit margins and likelihood of meeting or beating analyst expectations. Collectively, the results shed light on the effect of increased ownership concentration on tax avoidance.
Health, capability, and justice: toward a new paradigm of health ethics, policy and law.

INTRODUCTION 103 I. HEALTH ETHICS, POLICY AND LAW: THE CURRENT SET OF FRAMEWORKS 112 A. WELFARE ECONOMIC AND UTILITARIAN APPROACHES......112 B. COMMUNITARIANISM AND LIBERAL COMMUNITARIANISM 117 C. EGALITARIAN THEORIES: EQUAL OPPORTUNITY AND EQUAL WELFARE 118 D. LIBERTARIAN AND MARKET-BASED APPROACHES 123 E. DELIBERATIVE DEMOCRATIC PROCEDURES 127 F. SUMMARY OF PROBLEMS WITH THE CURRENT SET OF FRAMEWORKS 130 II. AN ALTERNATIVE PARADIGM: CAPABILITY AND HEALTH ACCOUNT 136 A. AN AGENCY-ORIENTED VIEW 137 B. POLICY IMPLICATIONS 138 C. INCOMPLETELY THEORIZED AGREEMENTS 140 III. APPLICATIONS 142 A. EQUITABLE ACCESS TO HIGH-QUALITY HEALTH CARE .....142 1. A Capability and Health Account of Equal Access ........142
Pay Convexity, Earnings Manipulation, and Project Continuation

ABSTRACT: This paper studies the optimal design of long-term executive pay plans when boards of directors use accounting information for investment decision-making and executives can take costly actions to manipulate this information. The model predicts that a shift to more convex executive pay plans, such as equity plans that rely more on options and less on stock, is associated with higher levels of manipulation, lower reporting quality, and less efficient investment. When designing the optimal contract, the board trades off these effects with the cost of inducing executive effort. The paper also analyzes how the optimal pay convexity and the equilibrium level of manipulation change when the CEO's opportunistic reporting discretion changes. The model predicts that an increase in the CEO's marginal cost of manipulation increases the optimal level of pay convexity and first increases and then decreases the magnitude of manipulation. JEL Classifications: M12; M41; G31.
A Synthesis of Equity Valuation Techniques and the Terminal Value Calculation for the Dividend Discount Model

This paper lays out alternative equity valuation models that involve forecasting for finite periods and shows how they are related to each other. It contrasts dividend discounting models, discounted cash flow models, and “residual income” models based on accrual accounting. It shows that some models that are apparently different yield the same valuation. It gives the general form of the terminal value calculation in these models and shows how this calculation serves to correct errors in the model. It also shows that all models can be interpreted as providing a particular specification of the terminal value for the dividend discount model. In so doing it shows how one calculates the terminal value for the dividend discount formula. The calculation involves weighting forecasted stocks and flows of value with weights determined by a parameter that can be discovered from pro forma analysis.
Hayek on Mill

It is perhaps an understatement to say that trying to understand F. A. Hayek’s assessment of John Stuart Mill is a complicated matter. Hayek referred to Mill frequently. Sometimes, and particularly in The Constitution of Liberty (1960), he praised him. What may surprise those who associate both Mill and Hayek with the classical liberal tradition is that more often, and this in writings that both preceded and followed publication of The Constitution of Liberty, Hayek criticized Mill. Moreover, the criticisms were not all of a piece, but focused on different aspects of Mill’s work. Part of the problem is that Mill, like Hayek, made so many different contributions: among those mentioned by Hayek were his System of Logic ([1843] 1973), the Principles of Political Economy ([1848] 1965), and of course On Liberty ([1859] 1977). In addition, Mill’s own views evolved, sometimes rather dramatically, over time. Which Mill—the doctrinaire utilitarian, the romantic, the one impressed by Auguste Comte or the one who disavowed him, the Mill of the early or of the later editions of The Principles, the pre– or post–Harriet Taylor Mill—is the one whose ideas Hayek is examining? Furthermore, it was not just Mill’s own thought, but
Precedent, Compliance, and Change in Customary International Law: An Explanatory Theory

Customary international law (CIL) is widely recognized as a fundamental source of international law. While its continued significance in the age of treaties was once contested, it is now generally accepted that CIL remains a vital element of the international legal order. Yet CIL is also plagued with conceptual and practical difficulties, which have led critics to challenge its coherence and legitimacy. In particular, critics of CIL have argued that it does not meaningfully affect state behavior. Traditional CIL scholarship is ill equipped to answer such criticism because its objectives are doctrinal or normative—namely, to identify, interpret, and apply CIL rules, or to argue for desirable changes in CIL. For the most part, that scholarship does not propose an explanatory theory in the social scientific sense, which would articulate how CIL works, why states comply, and why and how rules change.
"No Money Down" Bankruptcy

This Article reports on a breakdown in access to justice in bankruptcy, a system from which one million Americans will seek help this year. A crucial decision for these consumers will be whether to file a chapter 7 or chapter 13 bankruptcy. Nearly every aspect of their bankruptcies — both the benefits and the burdens of debt relief — will be different in chapter 7 versus chapter 13. Almost all consumers will hire a bankruptcy attorney. Because they must pay their attorneys, many consumers will file chapter 13 to finance their access to the law, rather than because they prefer the law of chapter 13 over chapter 7. Attorneys charge about $1,200 to file a chapter 7 bankruptcy; their debt-laden clients must pay this amount upfront. Attorneys charge about $3,200 to file a chapter 13 bankruptcy, but clients can pay attorney fees over time as part of their cases. Chapter 7 and 13 bankruptcies also differ in the relief achieved. Almost all chapter 7 cases end with the debtor receiving a discharge of debts. In contrast, only around one-third of chapter 13 cases end in discharge. This Article exposes the increasingly prevalent phenomenon of debtors paying nothing in attorneys’ fees to file chapter 13. New data from the Consumer Bankruptcy Project, our original empirical national study, suggest that these “no money down” consumers are similar to those who use chapter 7. However, because they cannot afford to pay their attorneys up front, these “no money down” bankruptcy debtors suffer. They pay $2,000 more and have their cases dismissed at a rate 18 times higher than if they had filed chapter 7. The two most significant predictors of whether a consumer files a “no money down” bankruptcy are a person’s place of residence and a person’s race. We could not identify legitimate ways that these factors correlate with debtors’ needs for the substantive legal benefits of chapter 13. “No money down” bankruptcy can be a distortion in the delivery of legal help. We suggest reforms to how attorneys collect fees from consumer debtors that will reduce the potential conflict between clients’ interests and attorneys’ interests. The reforms will deliver access to justice and improve the functioning of the bankruptcy system.
Punishing Cruelly: Punishment, Cruelty, and Mercy

What is cruelty? How and why does it matter? What do the legal rejection of cruelty and the requirements of mercy entail? This essay asks these questions of Lucius Seneca, who first articulated an agent-based conception of cruelty in the context of punishment. The hypothesis is submitted that the answers to these questions offered in Seneca’s De clementia constitute one of the turning points in the evolution of practical reason in law. I conclude, however, by arguing that even the mainstream punitive practices of contemporary western societies fail to meet the modest imperatives of the rejection of cruelty and the unconditionality of mercy propounded by Seneca.
Doomed to Re-Repeat History: The Triangle Fire, the World Trade Center Attack, and the Importance of Strong Building Codes

Imagine this: You are a member of a commission charged with recommending changes to the building code of a densely-packed urban city, say New York. Your recommendation is that high-rise office buildings are overly safe and that your city should relax its codes. That, more or less, is what happened in New York in 1968. Fifty-seven years after the Triangle Waist Company fire, in which 146 people trapped in the upper floors of an unsafe building burned, jumped, or fell from a collapsed fire escape to their deaths, New York City relaxed its safety rules for high-rise buildings.In his outstanding historical account, Triangle: The Fire that Changed America, David Von Drehle makes the cogent case that building-safety laws matter. And in their equally outstanding retelling of the 2001 World Trade Center attack from the perspective of those trapped inside the burning buildings, 102 Minutes: The Untold Story of the Fight to Survive inside the Twin Towers, Jim Dwyer and Kevin Flynn make the explicit case that we have forgotten this lesson.The parallels between the books and the events they portray are remarkable. In each case, we are reminded of the incentives that cause developers to squeeze the maximum amount of rentable space onto each expensive square foot of urban land. We come to understand the competing stresses on city bureaucrats charged with drafting and enforcing safety rules for high-rise buildings. We are treated to careful descriptions of the structures that inevitably result from these economic forces and safety rules. And we then watch a pair of disasters unfold, two miles and ninety years apart.
The Gentrification Trigger: Autonomy, Mobility, and Affirmatively Furthering Fair Housing

Gentrification connotes a process where often white “outsiders” move into areas in which once attractive properties have deteriorated due to disinvestment. Gentrification creates seemingly positive outcomes, including increases in property values, equity, and a city’s tax base, as well as greater residential racial and economic integration; yet it is typically accompanied by significant opposition. In-place residents fear that they will either be displaced or even if they remain the newcomers will change the culture and practices of the neighborhood. Gentrification then is understood to cause a loss of community and autonomy – losses that have been well recognized in the eminent domain literature. This article focuses on gentrifying neighborhoods that were abandoned during the government sponsored suburban migration of the 1950s through the 1980s. Racially discriminatory practices of government and private actors often denied Black and Latino families the option either to join the migration to the suburbs or to maintain their homes in city neighborhoods. This article argues that in-place residents of now gentrifying neighborhoods should have access to rental vouchers or low-interest loans to restore the autonomy they were previously denied, providing them with viable, self-determining options to remain or exit the neighborhood. Such a remedy – which is consistent with the Fair Housing Act’s obligation to HUD and its grantees to “affirmatively further fair housing” – has the potential to alter the political terrain of gentrification.
Activist Choice Homophily and the Crowdfunding of Female Founders

In this paper, we examine when members of underrepresented groups choose to support each other, using the context of the funding of female founders via donation-based crowdfunding. Building on theories of choice homophily, we develop the concept of activist choice homophily, in which the basis of attraction between two individuals is not merely similarity between them, but rather perceptions of shared structural barriers stemming from a common social identity based on group membership. We differentiate activist choice homophily from homophily based on the similarity between individuals (“interpersonal choice homophily”), as well as from “induced homophily,” which reflects the likelihood that those in a particular social category will affiliate and form networks. Using lab experiments and field data, we show that activist choice homophily provides an explanation for why women are more likely to succeed at crowdfunding than men and why women are most successful in industries in which they are least represented.
Confounding extremities: surgery at the medico-ethical limits of self-modification.

Controversy swept the U.K. in January of 2000 over public disclosure of the fact that a Scottish surgeon named Robert Smith had amputated the limbs of two able-bodied individuals who reportedly suffered from a condition known as apotemnophilia. The patients, both of whom had sought and consented to the surgery, claimed they had desperately desired for years to live as amputees and had been unable, despite considerable efforts, to reconcile themselves psychologically to living with the bodies with which they were born. Both surgeries were successful, and both patients, who had undergone psychiatric evaluation prior to the amputations, subsequently reported having no regrets. In the wake of a wave of sensationalistic stories in the media, the hospital at which the surgeries had been performed, the Falkirk and District Royal Infirmary, banned any future surgeries of the kind. Outraged local politicians promptly announced their intention to pass laws banning the procedure outright. One member of Scottish Parliament declared the surgery obscene and asserted that the whole thing is repugnant and legislation needs to be brought in now to outlaw this.