cssi/SciSciGPT-SciSciNet huggingface dataset:
Influential accounting articles, individuals, Ph.D. granting institutions and faculties: A citational analysis

Abstract This study utilizes the Accounting Research Directory to identify influential articles and individuals. Influence is denned in terms of cites per year by five leading accounting journals. The “top 100” articles are identified, and the 26 papers defined as classics are content analyzed to determine the contextual framework in which citation takes place. The 123 individuals whose body of work constitutes a classic (i.e. cited at least four times per year since year of publication) are identified, and these data are used to “rank” individuals, Ph.D. granting institutions and faculties.
Open Borders, the US Economic Espionage Act of 1996, and the Global Movement of Knowledge and People

The intersection between boundaries in intellectual property (IP) law and those in immigration policy is discussed. The US Economic Espionage Act of 1996 (EEA) provides a case study of how IP law is used to police real world boundaries across which people and ideas move.
Analyst Initiations of Coverage and Stock Return Synchronicity

ABSTRACT: We examine how the information produced by analysts when they initiate coverage contributes to the mix of firm-specific, industry-, and market-wide information available about the firm. We hypothesize that the first analyst to initiate coverage provides low-cost market and industry information allowing him/her to follow more stocks, whereas subsequent analysts provide firm-specific information to distinguish themselves from existing analysts. We use stock return synchronicity to measure the mix of information available about a firm, with higher synchronicity indicating more industry and market information. Coverage initiations of firms with no prior analyst coverage increase synchronicity, suggesting that analysts produce industry- and market-wide information. In contrast, analysts initiating coverage on firms with existing coverage appear to focus on producing firm-specific information as these initiations lead to reduced synchronicity. Together, our findings indicate that the type of informati...
Cross-Listings and the New World of International Capital: Another Look at the Efficiency and Extraterritoriality of Securities Law

This Article examines the cumulative welfare effect of the application of the U.S. regulatory regime on foreign private issuers (FPI) and whether the extraterritorial reach of U.S. law creates unnecessary risks deterring crosslistings. To assess the deterrence effect and optimality of regulations, the research designs a simplified model explaining decision-making processes of control persons and applies the model to the FPI regulatory regime and case law analysis. The Article assembles a sample of seventy-five cases, interprets the application of the conduct and effects test and recent Supreme Court decisions, examines deregistration forms filed in 2001–2011, and juxtaposes statistical data with recent law reforms in the United States, the European Union, and a number of other jurisdictions. The research concludes that the U.S. policies are not uniformly value maximizing for all categories of FPI. The current singlemodal policies of indiscriminate incremental deregulation fail to properly address the concerns of issuers from developed economies and may be socially wasteful and unnecessary for FPI from emerging markets. To solve this dilemma, the Article suggests three solutions premised on the policy of regulatory granularity.
Negative earnings, positive earnings and stock return predictability: An empirical examination of market timing

Abstract We examine the predictive ability of earnings-price ratios or yields for the S&P 500 index. We decompose the aggregate earnings-price ratio into its positive and negative components (“winners” vs “losers”) and find that the negative component has the most predictive ability. We also find that the earnings-price measures forecast both future returns and earnings growth. Our models display substantial variation in explanatory power over time with forecast power resurfacing in the latter 1990s. We conclude that to the extent that earnings-price yields predict future S&P 500 returns, the negative earnings component is the driving factor.
Forecasting the term structure of government bond yields

Despite powerful advances in yield curve modeling in the last 20 years, comparatively little attention has been paid to the key practical problem of forecasting the yield curve. In this paper we do so. We use neither the no-arbitrage approach nor the equilibrium approach. Instead, we use variations on the Nelson–Siegel exponential components framework to model the entire yield curve, period-by-period, as a three-dimensional parameter evolving dynamically. We show that the three time-varying parameters may be interpreted as factors corresponding to level, slope and curvature, and that they may be estimated with high efficiency. We propose and estimate autoregressive models for the factors, and we show that our models are consistent with a variety of stylized facts regarding the yield curve. We use our models to produce term-structure forecasts at both short and long horizons, with encouraging results. In particular, our forecasts appear much more accurate at long horizons than various standard benchmark forecasts. r 2005 Published by Elsevier B.V.
Weather or not? Welfare impacts of natural gas pipeline expansion in the northeastern U.S.

With the rapid development of new natural gas resources in the United States has come a number of proposals for new natural gas transmission infrastructure. We use a unique and fine-grained data set on natural gas spot pricing and gas transmission operations to model how a local pipeline expansion connecting a Marcellus Shale producing area to the main Transco pipeline system would affect flow patterns and zonal gas pricing across the Transco. Our modeling approach is based on arbitrage cost models for constrained energy networks, accounting for the effects of zonal gas transmission rates as mandated by the U.S. Federal Energy Regulatory Commission. Application of our model to a data set of daily gas market outcomes and operating conditions on the Transco between 2012 and mid 2014 suggests that the modeled pipeline expansion would increase overall economic welfare in the spot market for Transco deliveries by $1.7 billion and have positive net social benefits of about $0.4 billion. However, more than 80% of this estimated welfare gain occurs in one season (winter 2014) featuring high gas demand due to colder weather. Thus, the spot market efficiency gains associated with pipeline projects in the Marcellus region may be limited by the frequency of extreme cold weather conditions. To examine the sensitivity of our estimates of welfare gains to different weather conditions, we calculate the expected benefits of the pipeline expansion in terms of historical temperatures from 1992 to 2011, and find that Atlantic Sunrise would have increased welfare by approximately $1.8 billion over a two and half year period, on average.
Strong Claims and Weak Evidence: Reassessing the Predictive Validity of the IAT

The authors reanalyzed data from 2 influential studies-A. R. McConnell and J. M. Leibold and J. C. Ziegert and P. J. Hanges-that explore links between implicit bias and discriminatory behavior and that have been invoked to support strong claims about the predictive validity of the Implicit Association Test. In both of these studies, the inclusion of race Implicit Association Test scores in regression models reduced prediction errors by only tiny amounts, and Implicit Association Test scores did not permit prediction of individual-level behaviors. Furthermore, the results were not robust when the impact of rater reliability, statistical specifications, and/or outliers were taken into account, and reanalysis of A. R. McConnell & J. M. Leibold (2001) revealed a pattern of behavior consistent with a pro-Black behavioral bias, rather than the anti-Black bias suggested in the original study.
Preemption by Preamble: Federal Agencies and the Federalization of Tort Law

In the preamble to its January 2006 prescription drug labeling rule, the Food and Drug Administration (FDA) asserted that “FDA approval of labeling under the act . . . preempts conflicting or contrary State law.”1 The latest rule handed down by the Consumer Product Safety Commission (CPSC)—strengthening the requirements for bedding mattresses’ ability to withstand fires caused by open flames, such as candles, matches, and lighters—includes a sweeping preamble stating that the new federal standard preempts “inconsistent state standards and requirements, whether in the form of positive enactments or court created requirements.”2 And, if the National Highway Traffic Safety Administration (NHTSA) has its way, a new safety standard for roofs on sport-utility vehicles will include language immunizing auto manufacturers from state tort lawsuits over defective roofs if their autos meet federal safety standards.3 Dubbed “silent tort reform,”4 these preemption preambles may be only the tip of the iceberg—a harbinger of a future where federal agency regulations come
Subsidiarity and Self-Interest: Federalism at the European Court of Justice

Subsidiarity is the principle which the European Community has begun applying to consider whether federal legislation is necessary, or whether action by the Member States will suffice. This article considers whether subsidiarity should constrain the Court of Justice's jurisprudence as well. It begins by analyzing the federalism problems posed by the Court's case law concerning remedies for the violation of Community law, in particular the doctrine holding Member States liable in damages for failing properly to implement Community directives. After concluding that the Court is required to review this jurisprudence for consistency with the subsidiarity principle, and that the Court's existing compensation and rights-centered rationale is largely insufficient, the article develops a two-fold argument for sustaining Member State liability even under the subsidiarity principle: such liability is essential to deterring Member State cheating on implementation, and encourages the development of directives that delegate rather than precisely prescribe regulatory content. The article concludes by describing possible modifications to prevailing liability doctrine in order to render it more consistent with the subsidiarity and proportionality principles.
An Investigation of Earnings Management Through Marketing Actions

Prior research hypothesizes managers use “real actions,” including the reduction of discretionary expenditures, to manage earnings to meet or beat key benchmarks. This paper examines this hypothesis by testing how different types of marketing expenditures are used to boost earnings for a durable commodity consumer product that can be easily stockpiled by end consumers. Combining supermarket scanner data with firm-level financial data, we find evidence that differs from prior literature. Instead of reducing expenditures to boost earnings, soup manufacturers roughly double the frequency and change the mix of marketing promotions (price discounts, feature advertisements, and aisle displays) at the fiscal quarter-end when they have greater incentive to boost earnings. Our results confirm managers' stated willingness to sacrifice long-term value in order to smooth earnings and their stated preference to use real actions to boost earnings to meet different types of earnings benchmarks. We estimate that marketing actions can be used to boost quarterly net income by up to 5% depending on the depth and duration of promotion. However, there is a price to pay, with the cost in the following period being approximately 7.5% of quarterly net income. Finally, a unique aspect of the research setting allows tests of who is responsible for the earnings management. Although firms appear unable to increase the frequency of aisle display promotions in the short run, they can reallocate these promotions within their portfolio of brands. Results show firms shifting display promotions away from smaller revenue brands toward larger ones following periods of poor financial performance. This indicates the behavior is determined by parties above brand managers in the firm. These findings are consistent with firms engaging in real earnings management and suggest that effects on subsequent reporting periods and competitor behavior are greater than previously documented. This paper was accepted by Stefan Reichelstein, accounting.
The Fruits of Our Labors: An Empirical Study of the Distribution of Income and Job Satisfaction Across the Legal Profession

The law is known as a rewarding profession. Given the time, effort, and resources lawyers invest in mastering and conducting their vocation, the rewards of the profession would have to be great to attract so many new practitioners in recent years. The rewards may be pecuniary, in the form of a high annual income, or nonpecuniary, in the form of high job satisfaction in a challenging and esteemed profession. However, there is good reason to believe that these rewards are not evenly distributed across all members of the profession. The lore of the placement office is that various types of practice, for example private practice in a large firm, are more remunerative than others, for example government or public interest work. Given job opportunities in both the more and the less remunerative types of practice, the hope of lawyers who go into the less remunerative must be that they will find greater job satisfaction. Accordingly, one might expect to find that lawyers who go into less financially rewarding types of practice report greater job satisfaction than lawyers who go into the more lucrative types of practice. Theoretical and empirical work also suggest that women and minorities may not share equally in the rewards of the profession.1 Child care responsibilities and discrimination may affect their work histories
The "Tomahawk" and the "Healing Balm": Drug Treatment Courts in Theory and Practice

More than 2,000 drug courts now operate throughout the U. S. and in a number of other countries. Hundreds of other problem-solving courts derived in one way or another from drug courts are also in operation. The data seem to indicate that drug courts increase the retention rate of clients in treatment and, for those participants who complete the program, may lead to reduced rates of either re-arrest or re-conviction relative to control groups of substance misusing offenders processed through the traditional criminal system. There is, however, considerable variation in outcome associated with offender characteristics and local institutional practice. Consequently, it is virtually impossible to make confident global assertions that these enterprises generally are a success or a failure.This article examines a variety of outcome studies, in order to provide an overall picture of drug treatment courts in the United States. In addition, it discusses two detailed observational studies of specific drug treatment courts, in order to provide some insights into why these courts may succeed for some participants and fail others. The article suggests that drug treatment courts share the tendency of virtually all treatment/punishment hybrids to collapse into predominately punitive enterprises. In addition, the moral disapproval that attends drug misuse complicates efforts to provide supportive, reintegrative treatment within the context of the criminal blaming system. Given the totalizing moral judgments that pervasively are directed against drug users throughout American society, it is difficult even for professionals in the fields of social work and medicine to maintain an empathic and respectful stance toward clients and patients who suffer from drug use disorders. To the extent that these disorders are chronic, relapsing conditions, it is inevitable that some significant number of defendants in drug court will fail to adhere - often in a serious and sustained way - to the requirements of the program. At those moments, the exercise of moral discretion required of treatment court judges is necessarily vulnerable to being corrupted by the background normative understandings of addicts and addiction that derive from the very criminal justice policies within which these courts are embedded.
The Similarity Network of Motion Pictures

Ideas are connected. New ideas are often seen as creative combinations of previous ideas. I study these connections in the context of motion pictures. A network of 4,445 movies is constructed to in...
Don't Disintegrate Microsoft (Yet)

During the Clinton Administration, the United States sought to disintegrate Microsoft to remedy the firm's purported monopolistic conduct. The remedy proposed by the United States would have divided Microsoft into two firms. One, the Oppco, would have retained the firm's operating system business. The other firm, the Appco, would have retained the firm's applications business, including Internet Explorer and Microsoft's Office Suite. The United States did not rebut the presumption that the integration of Microsoft's operating system and applications business was procompetitive. Instead, the government claimed that disintegration of Microsoft would lower the so-called "applications barrier to entry," a barrier that Microsoft's unlawful conduct purportedly "raised." Most importantly, the government claimed that an independent Appco would probably transform Microsoft's Office Suite into a form of middleware, the existence of which would lower the "applications barrier to entry" and thus facilitate the emergence of operating systems competitive with Windows. This paper argues that the district court erred when it granted the government's petition for disintegration. Simply put, the court's factual findings did not support any element of the story supporting the government's request for relief. There was, for instance, no finding that Microsoft "raised" the applications barrier; that barrier existed before, during, and after the conduct at issue in this case. Similarly, there was no finding that Microsoft unlawfully maintained that barrier, i.e., that, but for Microsoft's anticompetitive conduct, middleware would have emerged and lowered the applications barrier to entry. Moreover, there was no finding that an independent Appco would, in fact, have the ability or incentive to transform Microsoft's Office Suite into a form of middleware. Finally, there was no finding that Appco would be the only source of middleware capable of lowering the applications barrier to entry. The absence of the sort of findings necessary to justify disintegration was a necessary consequence of the government's litigation strategy. The government did not undertake to prove that Microsoft's conduct actually reduced social welfare. Instead, the United States chose to rely upon outmoded antitrust rules that reduced its burden at trial. For instance, the government relied upon the per se rule against tying contracts, which bans certain ties regardless of their competitive effect. Moreover, the government relied upon precedents suggesting that non-standard contracts entered by a monopolist are presumptively unlawful, regardless of their actual effect. By lightening its load at the trial stage, the United States deprived itself of the sort of factual findings necessary to justify the destruction of presumptively beneficial integration. Absent further findings that validate the government's story, Microsoft should remain intact.
The Limits of Secularism: Public Religious Expression in Moments of National Crisis and Tragedy

In the days following September 11, Americans gathered at public events all over this Nation to share their grief and affirm their solidarity. Religion exercise played a prominent role at these events. Participants prayed together, sang hymns together, and expressed their collective belief that, despite the terrorist attack, God would continue to bless America. At one level, the fact that these events featured state-supported religious exercise would appear to be constitutionally problematic. The prayers and supplications offered at these events were deeply moving and deeply felt. They were also often deeply sectarian. The events embodied true religious exercise, not the watered-down versions commonly associated with public events. In most circumstances, this would be seen as a classic and egregious Establishment Clause violation. Certainly, it transgressed most anti-establishment policies. State-sponsored religion is thought of as demeaning to religion, as compromising religious integrity, and as threatening religious pluralism. Religion is believed to be beyond state competence. Yet the post-September 11 events had public officials designing religious programs, selecting religious participants, and determining how best to meet their citizens religious needs. At the same time, any conclusion that the post-September events were unconstitutional is also problematic. The Nation's need for religious outlet was too strong and adherence to a secularism that would require such a result too rigid. I suggest in this essay that the tension between the constitutional commitment to anti-establishment and the societal need to engage in collective religious exercise can be accommodated by a doctrine that allows for government support for religion in limited and exceptional circumstances. But there are larger lessons about the interrelation between religion and state that can be learned from the post-September 11 events. While maintaining our secular status, we remain a deeply religious and spiritual society. This is not a paradox. The constitutional commitment to secularism serves to protect, and not to displace, our collective religiosity. The constitutional value of secularism is in its instrumental role, not in its own orthodoxy. As such, the adherence to secularism need not be absolute. There may be moments of national crisis and grief when instrumental values pale and it becomes constitutionally permissible to pierce the secular veneer.
What Dilemma? Moral Evaluation Shapes Factual Belief

Moral dilemmas—like the “trolley problem” or real-world examples like capital punishment—result from a conflict between consequentialist and deontological intuitions (i.e., whether ends justify means). The authors contend that people often resolve such moral conflict by aligning factual beliefs about consequences of acts with evaluations of the act’s inherent morality (i.e., morality independent of its consequences). In both artificial (Study 1) and real-world (Study 2) dilemmas, the more an act was deemed inherently immoral, the more it was seen as unlikely to produce beneficial consequences and likely to involve harmful costs. Coherence between moral evaluations and factual beliefs increased with greater moral conviction, self-proclaimed topical knowledge, and political conservatism (Study 2). Reading essays about the inherent morality or immorality of capital punishment (Study 3) changed beliefs about its costs and benefits, even though no information about consequences was supplied. Implications for m...
An economic analysis of online advertising using behavioral targeting

Online publishers and advertisers have recently shown increasing interest in using targeted advertising online. Such targeting allows them to present users with advertisements that are a better match, based on their past browsing and search behavior and other available information (e.g., hobbies registered on a web site). This technique, known as behavioral targeting, has been hailed as the new "Holy Grail" in online advertising because of its potential effectiveness. In this paper, we study the economic implications when an online publisher engages in behavioral targeting. The publisher auctions off an advertising slot and is paid on a cost-per-click basis. Using a horizontal differentiation model to capture the fit between a user and an advertisement being displayed, we identify the factors that affect the publisher's revenue, the advertisers' payoffs, and social welfare. We show that revenue for the online publisher in some circumstances can double when behavioral targeting is used. However, increased revenue for the publisher is not guaranteed: in some cases, the prices of advertising and hence the publisher's revenue can be lower, depending on the degree of competition and the advertisers' valuations. We identify two effects associated with behavioral targeting: a competitive effect and a propensity effect. The relative strength of the two effects determines whether the publisher's revenue is positively or negatively affected. We also demonstrate that, although social welfare is increased and small advertisers are better off under behavioral targeting, the dominant advertiser might be worse off and reluctant to switch from traditional advertising.
Tackling the Retailer Decision Maze: Which Brands to Discount, How Much, When and Why?

We propose a model that seeks the optimal timing and depth of retail discounts with the optimal timing and quantity of the retailer's order over multiple brands and time periods. The model is based on an integration of consumer decisions in purchase incidence, brand choice and quantity with the dynamics of household and retail inventory. The major contribution of the model is that it shows how the optimum depth and timing of discount varies with key demand characteristics such as consumer stockpiling, loyalty, response to the marketing mix, and segmentation. In addition, the optima also vary with key supply characteristics such as retail margins, depth and frequency of manufacturer deals, retail inventory, and retagging costs. The most valuable contribution of the model is that it can provide an optimal discount strategy for multiple brands over multiple time periods. The optimization model runs on a user-friendly personal computer program. An application based on UPC scanner data illustrates the model's uses. Sensitivity analyses of the optimization model under alternative scenarios reveal novel insights as to how optimal discounts vary as a function of the key demand and supply characteristics.
Corporate Investment and Stock Market Listing: A Puzzle?

We investigate whether short-termism distorts the investment decisions of stock market-listed firms. To do so, we compare the investment behavior of observably similar public and private firms, using a new data source on private U.S. firms and assuming for identification that closely held private firms are subject to fewer short-termist pressures. Our results show that compared with private firms, public firms invest substantially less and are less responsive to changes in investment opportunities, especially in industries in which stock prices are most sensitive to earnings news. These findings are consistent with the notion that short-termist pressures distort investment decisions.
Labor-Force Heterogeneity and Asset Prices: The Importance of Skilled Labor

Heterogeneity in the composition of the labor force affects asset prices in the cross section. We combine a model of labor heterogeneity with a neoclassical q-theory model with labor adjustment costs and show that the negative expected return-hiring rate relation documented in previous studies should be steeper in industries with higher labor adjustment costs. Empirically, using a novel industry level measure of labor skills as a proxy for the size of labor adjustment costs, we show that the negative expected return-hiring rate relation is two times larger among industries with higher labor skills than in industries with lower labor skills.
Of Snakes and Butterflies: A Reply

This brief essay, a reply to a forthcoming essay by Radicals in Robes by Saikrishna Prakash in the Columbia Law Review, makes two points. The first is that the abstract idea of interpretation cannot support originalism or indeed any judgment about the competing (reasonable) approaches to the Constitution. Any such judgment must be defended on pragmatic grounds, which means that it must be attentive to consequences. The second point is that the consequentialist judgments that support minimalism also suggest that there are times and places in which minimalism is rightly abandoned. For example, broad rulings may well be justified when predictability calls for it; and the Supreme Court was right to refuse minimalism in the late 1930s. While minimalism is generally the proper approach to “frontiers” issue in constitutional law, its own pragmatic foundations suggest that constitutional law should not be insistently or dogmatically minimalist.idea of interpretation cannot support originalism or indeed any judgment about the competing (reasonable) approaches to the Constitution. Any such judgment must be defended on pragmatic grounds, which means that it must be attentive to consequences. The second point is that the consequentialist judgments that support minimalism also suggest that there are times and places in which minimalism is rightly abandoned. For example, broad rulings may well be justified when predictability calls for it; and the Supreme Court was right to refuse minimalism in the late 1930s. While minimalism is generally the proper approach to “frontiers” issue in constitutional law, its own pragmatic foundations suggest that constitutional law should not be insistently or dogmatically minimalist.
Trust, expertise, and the philosophy of science

Trust is a central concept in the philosophy of science. We highlight how trust is important in the wide variety of interactions between science and society. We claim that examining and clarifying the nature and role of trust (and distrust) in relations between science and society is one principal way in which the philosophy of science is socially relevant. We argue that philosophers of science should extend their efforts to develop normative conceptions of trust that can serve to facilitate trust between scientific experts and ordinary citizens. The first project is the development of a rich normative theory of expertise and experience that can explain why the various epistemic insights of diverse actors should be trusted in certain contexts and how credibility deficits can be bridged. The second project is the development of concepts that explain why, in certain cases, ordinary citizens may distrust science, which should inform how philosophers of science conceive of the formulation of science policy when conditions of distrust prevail. The third project is the analysis of cases of successful relations of trust between scientists and non-scientists that leads to understanding better how ‘postnormal’ science interactions are possible using trust.
When animals attack: The effects of mortality salience, infrahumanization of violence, and authoritarianism on support for war

Terror management theory (TMT) suggests that people are motivated to elevate themselves above other animals as a way of denying their creatureliness and mortality. Based on this reasoning, the present study assessed whether infrahumanizing violence by emphasizing its similarities to animal aggression would lead to reduced support for war, especially when mortality is salient. This hypothesis was supported among participants high in right-wing authoritarianism (RWA), who are especially prone to infrahumanize outgroup members and are generally more supportive of military action against outgroups. RWA was associated with greater support for war against Iran, except when primed with thoughts of death and violence as an infrahuman behavior. These data suggest that by portraying violence as something instinctual and creaturely, it may be possible to reduce inter-group hostility and aggression among individuals who tend to be more dispositionally aggressive, particularly in the context of the death awareness that often exacerbates inter-group conflict.
Is there a Human Right to Medical Insurance

This paper claims that health insurance is not a human right; that the reason the medical care industry is in such an unsatisfactory state is that there is not enough competition in the field. To wit, there are government interferences on both the supply and demand sides of health care; the former in terms of restrictions on entry for physicians, the latter based on the moral hazard attendant on the subsidization of medicine.
After Midnight: The Circuit Judges and the Repeal of the Judiciary Act of 1801

A student of law or American history almost always encounters the midnight judges as a mere footnote to Marbury v. Madison. Yet despite an outpouring of work on the conflict between the Republicans and the federal judiciary in the wake of the Election of 1800, insufficient attention has been paid to the judges’ role in the crisis they served to precipitate. This Article aims to correct that oversight.Drawing on a wide variety of documentary evidence, including a cache of archival letters between the judges that has escaped notice to date, it sketches a comprehensive picture of the judges’ efforts in defense of their offices. It also adds important new details and contextualizes others, and corrects a persistent misconception in the existing literature. And, by taking a broader perspective than the standard Supreme Court-centered account of the repeal of the Judiciary Act of 1801, it highlights the ways in which practical, political, and constitutional factors shaped and constrained the (non)resolution of the episode’s core issue: the constitutionality of abolishing the office of a sitting judge. This new evidences argues for a revised understanding that puts the midnight judges, if not on the marquee, at least in a supporting role in working out the meaning of the repeal.
VIX Futures and options: A Case Study of Portfolio Diversification During the 2008 Financial Crisis

In 2008, the S&P 500 experienced a drawdown of about 50% from peak to trough. Many assets which are typically considered effective equity diversifiers also faced precipitous losses. Most hedge fund strategies and commodity indices were not immune from declining. For example, the HFRX Global Hedge Fund Index had a maximum drawdown of approximately 25% of its value in 2008, with some of its sub-indexes dropping almost 60%. The drop in commodities was even more significant. The S&P GSCI commodity index experienced a maximum drawdown of about 2/3 of its value in 2008. In stark contrast, volatility levels as measured by VIX experienced significant increases and in 2008 repeatedly set new highs not seen since the crash of 1987. This study assesses the impact of a long VIX investment as a diversifier for a typical institutional investment portfolio during the 2008 credit crisis.
Against Elections: The Lottocratic Alternative

It is widely accepted that electoral representative democracy is better — along a number of different normative dimensions — than any other alternative lawmaking political arrangement. It is not typically seen as much of a competition: it is also widely accepted that the only legitimate alternative to electoral representative democracy is some form of direct democracy, but direct democracy — we are told — would lead to bad policy. This article makes the case that there is a legitimate alternative system — one that uses lotteries, not elections, to select political officials — that would be better than electoral representative democracy. Part I diagnoses two significant failings of modern-day systems of electoral representative government: the failure of responsiveness and the failure of good governance. The argument offered suggests that these flaws run deep, so that even significant and politically unlikely reforms with respect to campaign finance and election law would make little difference. Although my distillation of the argument is novel, the basic themes will likely be familiar. I anticipate the initial response to the argument may be familiar as well: the Churchillian shrug. Parts II, III, and IV of this article represent the beginning of an effort to move past that response, to think about alternative political systems that might avoid some of the problems with the electoral representative system without introducing new and worse problems. In the second and third parts of the article, I outline an alternative political system, the lottocratic system, and present some of the virtues of such a system. In the fourth part of the article, I consider some possible problems for the system. The overall aims of this article are to raise worries for electoral systems of government, to present the lottocratic system and to defend the view that this system might be a normatively attractive alternative, removing a significant hurdle to taking a non-electoral system of government seriously as a possible improvement to electoral democracy.
Modeling Industry Political Dynamics

The purpose of this article is to extend from the business and society research focus on corporate political strategy and to factor this emphasis into business strategy thinking. The approach taken is to incorporate business and society concepts into a model that parallels Michael Porter's well-known Five Forces Model of business strategy. The applicability of the parallel model for practitioners and academics is then illustrated by using the model to analyze the television violence issue.
The International Response to Climate Change: An Agenda for Global Health

As the international community negotiates a successor to the Kyoto Protocol of the United Nations Framework Convention on Climate Change (UNFCCC), there is new reason to hope that meaningful action might be taken to prevent devastating climate change. Even the more ambitious mitigation targets currently under negotiation, however, will not be sufficient to avoid a profound effect on the public's health in coming decades, with the world's poorest, most vulnerable populations bearing the disproportionate burden. The influence of historic and current emissions will be so substantial that it is imperative to reduce global emissions while at the same time preparing for the effects. Recently, the UNFCCC has begun to turn its attention to adaptation-changes to human systems to ameliorate the consequences of climate change. This Commentary proposes a new agenda for mitigation as well as adaptation approaches that emphasize the considerable health effects of climate change, which include increasingly intense and more frequent natural disasters, potential increases in vector-, food-, and water-borne infectious disease, and exacerbation of cardiovascular and respiratory disease. The effects of climate change will be experienced in every region but will disproportionately burden the global poor, exacerbating global health disparities and challenging the international community to address the inevitable questions of global social justice. Three key recommendations are proposed: (1) focus mitigation targets on broader health impacts, rather than framing climate change as a coastal issue; (2) incorporate land-use and agricultural approaches to mitigation alongside measures in the energy and transportation sectors to take advantage of co-benefits for health; and (3) fully fund adaptation projects as a global priority with an emphasis on strengthening health systems.
Using Non-Pecuniary Strategies to Influence Behavior: Evidence from a Large Scale Field Experiment

Policymakers are increasingly using norm-based messages to influence individual decision making. We partner with a metropolitan water utility to implement a natural field experiment to examine the effect of such messages on residential water demand. The data, drawn from more than 100,000 households, indicate that social comparison messages had a greater influence on behavior than simple prosocial messages or technical information alone. Moreover, our data suggest that social comparison messages are most effective among households identified as the least price sensitive: high users. Yet the effectiveness of such messages wanes over time. Our results thus highlight important complementarities between pecuniary and nonpecuniary strategies.
Judicial Transparency in an Age of Prediction

The Empirical Legal Studies (ELS) movement is making strides toward understanding judicial behavior, and ELS models could become the foundation for more accurate prediction of judicial decisions. This essay raises two questions associated with this development. First, what would an age of predictable judicial behavior look like? Second, would satisfying the informational needs of ELS prediction models also exhaust the demands for "judicial transparency"? My conclusions are that a state of predictable judicial behavior, if somehow stable, would leave almost no litigation to observe; and that a prediction-oriented information policy would nearly meet the demands of today's transparency advocates. One shortfall involves the intrinsic/consumption value of adjudication for intellectuals and others. A prediction-oriented policy would not meet that demand and could even thwart its satisfaction which presents an unappreciated normative choice for information policy.
The influence of wages on parents’ allocations of time to child care and market work in the United Kingdom

We use time-diary data on couples with children from the 2000 United Kingdom Time Use Survey to examine the impacts of own and partner’s wages on parents’ provision of child care and market work on weekdays and on weekends and holidays. We find that increases in partners’ wages increase women’s primary care on all days and decrease their market work on weekdays, while increases in women’s own wages increase their market work on weekdays. There is little evidence that men’s time use responds to changes in their own wages. However, an increase in men’s partners’ wages increases men’s passive child-care time on weekends and reduces their market-work time on weekends.
The Impacts of Unemployment on Alternative Poverty Rates

The analysis uses March Current Population Survey data to estimate state-level cross-section/time-series models of the effects of the unemployment rate on alternative poverty rates. The measures include the official headcount rate, and alternatives based higher thresholds, revised equivalence scales and income defined as inclusive and exclusive of taxes and cash and in-kind transfers. The estimated effects turn critically on the measurement approaches, both for the total sample population and for four population sub-groups. For several alternative poverty rate measures, the unemployment rate has no significant impact on poverty. By contrast, real per-capita median earnings have strong and consistently negative effects on the poverty rates of all groups studied. The findings thus provide important lessons for researchers exploring the links between economic conditions and poverty, and for policy makers developing poverty reduction strategies.
Reflections on Identity, Diversity and Morality

When I was growing up in Auburn, New York, people referred to me as “one of the Post girls.” I never thought to question the label. Although it did not describe me completely, it provided most of the information needed to place me within the social landscape of our town. In fact, I never really thought about describing myself in any other way until I left home and people began to ask me “What are you, anyway?”
Computation of approximate optimal policies in a partially observed inventory model with rain checks

This paper proposes a new methodology to solve partially observed inventory problems. Generally, these problems have infinite-dimensional states that are conditional distributions of the inventory level. Our methodology involves linearizing the state transitions via unnormalized probabilities. It then uses an appropriate functional basis to represent the state. Considering the speed and stability of computations, we choose truncated Chebyshev polynomials as the basis. We use Fast Fourier Transforms along with an appropriate discretization of inventory levels to speed up the computations. These main ideas are blended to obtain an iterative algorithm to solve a partially observed inventory model with rain checks. In this model, the inventory manager (IM) does not know the inventory level when it is positive. Otherwise, the IM fully observes it. This model provides a context to illustrate our methodology, which applies to other such models. Although this model has been studied mathematically in the literature, the use of our algorithm provides a numerical approximation of the optimal order quantities. These are compared to the orders released under a base mean-stock policy, where the IM replaces the unobserved inventory level with its mean and applies the well-known base stock policy. We show numerically that the optimal order quantity is very close to the base mean-stock order quantity, when the variance of the inventory distribution is small. When the mean of the inventory distribution is large, the optimal order quantity is more than the base mean-stock quantity, and it is the other way around when the mean is small or negative. These insights are explained via uncertainty and information effects and their interplay. We expect this interplay to show up in other partially observed inventory models.
Regulating Paid Household Work: Class, Gender, Race, and Agendas of Reform

Introduction 852 I. Origins of a Movement 860 A. “The Elaboration of Needs” 861 B. The Servant Problem 864 II. To Be Free 868 A. This Day Never Ends 869 B. Blackstone’s Forgotten Servant 875 C. To Be White and Free 877 III. The Business of Regulating Privilege 882 A. Self Regulation: The Contract Solution 883 B. The Legislative Campaign 886 IV. The Limitations of Household Reform Advocacy 890 A. Conceptions of Paid Household Work and Responses from Reformers 892 1. The no-problem rationale 893 a. Housework: Good for a woman’s health 893 b. Reformers respond: On race, domesticity, and health 896 2. The no-product rationale 898 a. The economic devaluation of paid housework..... 898 b. Reformers respond: Lessons from Amey Watson of the NCHE 900
Toward More Parsimony and Transparency in “The Essentials of Marriage”

Written for a symposium about marriage-related innovation, this article catalogs impediments to freedom of contract related to marriage that American judges and legislatures have put in the law and continue to impose. Although many of these impediments have become quaint, 'defense of marriage' statutes codified in the last fifteen years have made this interference worse. Marriage is a legal status, of course, and Status defeats Contract almost by definition. From a premise that the state ought to use its interference power sparingly, however, the article calls for more parsimony and transparency in the law of marriage: Constraints on freedom related to marriage should be kept to a reasonable minimum; to the extent they persist, these constraints ought to be intelligible.
A Case for Randomized, Double-Blinded, Sham-Controlled Class III Medical Device Trials

In this paper, I evaluate the ethical implications of the FDA’s move to en-courage randomized, double-blinded, sham-controlled trials for Class III devices when such studies are possible. In Part I, I describe the placebo effect and how researchers control for it. In Part II, I describe the results of studies of medical procedures and devices that have used a sham control. In Part III, I describe the ethical concerns surrounding the use of sham surgeries to study medical devices. In Part IV, I argue for the use of randomized, double-blinded, sham-controlled device trials, and propose an ethical framework for these studies.
Robustness of Forecast Combination in Unstable Environment: A Monte Carlo Study of Advanced Algorithms

In this paper, we study the behavior and effectiveness of several recently developed forecast combination algorithms in simulated unstable environments, where the performances of individual forecasters are cross-sectionally heterogeneous and dynamically evolving. Our results clearly reveal how different algorithms respond to structural instabilities of different origin, frequency, and magnitude. Accordingly, we propose an improved forecast combination procedure and demonstrate its effectiveness in a real-time forecast combination exercise using the U.S. Survey of Professional Forecasters.