Abraham de Moivre en zijn “Doctrine of Chances”

Summary ABRAHAM DE MOIVRE (1667 Vitry - 1754 London) was one of the foremost pioneers in the domain of the theory of probability. His principal contributions are laid down in his “Doctrine of Chances” (three editions, 1718, 1738, 1756). This classic work, almost forgotten, is now republished, as a splendid photographic reprint of the third (last) edition, by Chelsea Publishing Company of New York (1967). In this article we specially mention his original contributions respecting the problem of the duration of play, the theory and application of recurrent series, the theory of runs, and especially his extension of the value of BERNOULLI'S theorem by the aid of STIRLING'S theorem. In the last mentioned research DE MOIVRE obtained the equation for the curve of error, thus antedating LAPLACE by about 50 and GAUSS by 76 years. This important fact is discovered by KARL PEARSON in 1924.     

Foreign Banks: Trends and Impact

Over the past two decades, foreign banks have become much more important in domestic financial intermediation, heightening the need to understand their behavior. We introduce a new, comprehensive database, made publicly available, on bank ownership (including the home country of foreign banks) for 5,324 banks in 137 countries over the period 1995–2009. We document large increases in foreign bank presence in many countries, but with substantial heterogeneity in terms of host and banks’ home countries, bilateral investment patterns, and bank characteristics. In terms of impact, we document that the relation between private credit and foreign bank presence importantly depends on host country and banks’ characteristics. Specifically, foreign banks only seem to have a negative impact on credit in low‐income countries, in countries where they have a limited market share, where enforcing contracts is costly and where credit information is limited available, and when they come from distant home countries. This shows that accounting for heterogeneity, including bilateral ownership, is crucial to better understand the implications of foreign bank ownership.     

Time‐Varying Fund Manager Skill

We propose a new definition of skill as general cognitive ability to pick stocks or time the market. We find evidence for stock picking in booms and market timing in recessions. Moreover, the same fund managers that pick stocks well in expansions also time the market well in recessions. These fund managers significantly outperform other funds and passive benchmarks. Our results suggest a new measure of managerial ability that weighs a fund's market timing more in recessions and stock picking more in booms. The measure displays more persistence than either market timing or stock picking alone and predicts fund performance.     

RETROSPECTIVE ON OIL PRICES

Energy is the most abundant resource in the universe. While energy supplies are unbounded, useful energy is not. To convert naturally occurring energy resources into useful work, mankind must invest capital and labor–resources that normally are scarce. To produce or use primary energy, both producers and consumers must invest in specialized and often inflexible equipment. In calculating the perceived value of present and future oil supplies, the Organization of Petroleum Exporting Countries and almost everyone else mistook for economic rent the windfall profits associated with short-term rigidities in energy use. Attention focused on the cost of manufacturing a synthetic crude oil, rather than on the incremental cost of changing consumption patterns in end-use markets. Mis judgments on the future value of oil were compounded by ill-conceived government policies and inaccurate forecasts. Substitution of oil for other energy commodities can occur at nearly every point along the chain downstream from the production of primary resources, but it occurs most abundantly and importantly at the point of final consumption. Liquid petroleum remains the cheapest fuel to transport, chiefly because a vast infrastructure already exists to handle it. The steady advance of technology explains the long-term decline in the real prices of most products, including retail energy prices. Often, the increasing unit costs of harvesting or extracting a finite scarce natural resource have been more than offset by improvements in manufacturing or end-use technology. The mix of commodities bought and sold in the next generation may be unrecognizable to today's consumer. Thus, the cost of any one primary resource or intermediate product may be irrelevant.     

Multi‐level Environmentalism and the European Union: The Case of Trans‐European Transport Networks

In the European Union, trans‐European transport networks (TENs) are a vital element in the constitution of one European space in order to enable the free movement of people and goods throughout the Union. Their construction, however, often causes environmental degradation. Opposition to EU politics is mostly voiced at the level of individual nation‐states. As the case of TENs reveals, however, protest against European policy projects with environmental side effects can take the form of ‘multi‐level environmentalism’, linking lobbying and ‘conscientization’ in Brussels with direct action at the national and local levels. Civil society theory, social movement theory and governance theory help ensure a theoretically informed answer to the question of how the resistance to TENs is organized and framed. By questioning dominant problem definitions and solution strategies, environmental movements and movement organizations, both in Brussels and in the individual nation‐states, point to the possibility of looking at social and political reality from another, non‐hegemonic point of view. In this way, they contribute to challenging the often biased technocratic, growth‐oriented character of the European Union.