Estimating Key Economic Variables: The Policy Implications

The current monetary policy debate has focused on current estimates and the future path of the natural rate of unemployment and the equilibrium interest rate. Estimates of the natural rate of unemployment should vary over time with changes in demographics and improvements in human capital. However, these changes should be gradual. This paper shows that the estimates of the natural rate of unemployment by Federal Reserve officials and private-sector economists seem to move pro-cyclically, potentially showing too much weight given to short-term fluctuations in economic variables. As with the natural rate, there are good reasons to expect the equilibrium interest rate to change over time. In fact, the level may actually be more responsive to current economic data, reflecting changes in aggregate savings and investment. Yet, we see that equilibrium interest rate estimates by both Federal Reserve officials and private-sector economists have declined quite dramatically over the past five years. A potential concern raised in this paper is that estimates of these critical economic variables for policy determination appear to be overly sensitive to high frequency economic data.     

Introduction to the Special Issue on “The Intersection Between Industrial Organization and Healthcare Economics”

This article introduces the special issue on the intersection between industrial organization and healthcare economics. This intersection has received increasing research interest, growing from 2% of the industrial-organization literature in 1991 to 6% in 2016. We describe the nine included articles, which cover a range of healthcare markets that include hospital services, insurance, and pharmaceuticals.     

Do Cryptocurrencies Increase the Systemic Risk of the Global Financial Market?

The advance of cryptocurrencies has sparked wide concern over their interplay with the existing global financial market. This paper analyzes the risk spillover relation between cryptocurrencies and major financial assets, and unravels how cryptocurrencies could influence global financial systemic risk. We find that cryptocurrencies function as a separate risk source from traditional assets. Major legislative, financial and technological events in the cryptocurrency market may affect risk spillover dynamics. Although the overall penetration of cryptocurrencies is not yet deep, introducing cryptocurrency can significantly increase the systemic risk to traditional markets during low risk level episodes.     

“Just a Little Respect”: Effects of a Layoff Agent’s Actions on Employees’ Reactions to a Dismissal Notification Meeting

For several decades, most discussion on financial fraud has centered on the fraud triangle, which has evolved over time through various extensions and re-interpretations. While this has served the profession well, the articulation of the human side of the act is indirect and diffused. To address this limitation, this research develops a model to explain the role of human desires, intentions, and actions in indulgence of, or resistance to, the act of financial fraud. Evidence from religion, philosophy, sociology, neurology, behavioral economics, and social psychology is integrated to develop and support an alternative fraud model, called the disposition-based fraud model (DFM). To articulate the model, its two primary components, disposition and temptation, are further developed and extended. Although the DFM is generally applicable to any act of fraud, this paper focuses on executive fraud. The similarities and differences between the DFM and extant fraud models are discussed. Importantly, in light of the DFM, a re-interpretation of the fraud triangle is made to improve our understanding of the human element in it. Additionally, potential implications of the model for corporate governance are discussed, suggestions for further research are offered, and the DFM’s strengths and limitations are noted.     

Extreme value statistics for censored data with heavy tails under competing risks

This paper addresses the problem of estimating, from randomly censored data subject to competing risks, the extreme value index of the (sub)-distribution function associated to one particular cause, in a heavy-tail framework. Asymptotic normality of the proposed estimator is established. This estimator has the form of an Aalen-Johansen integral and is the first estimator proposed in this context. Estimation of extreme quantiles of the cumulative incidence function is then addressed as a consequence. A small simulation study exhibits the performances for finite samples.     

面源污染视角下江西省耕地利用效率研究

[目的]在面源污染视角下考察耕地利用效率,可以为推动耕地可持续利用提供理论和参考依据。[方法]文章基于2000—2014年我国13个粮食主产省(区)耕地投入产出的面板数据,运用SBM方向性距离函数将耕地面源污染因素纳入到传统的效率分析框架,从省际比较的维度对江西省耕地利用效率进行了测度与分析。[结果]考虑面源污染因素对耕地利用效率测算产生了一定的影响;江西省耕地利用效率值呈现阶段性特征,耕地利用效率排名比较稳定,近年来排名有上升趋势;江西省耕地利用绩效一般,且与最佳实践者存在较大的差距。[结论]忽视面源污染因素的耕地利用效率评估是失真和不符合实际的,宜将面源污染因素纳入到耕地利用效率的测度框架,以此来更科学地量化评估耕地利用绩效;设计和完善相关政策,以有效控制耕地面源污染;加强与先进省(区)的交流与合作,学习其农业可持续耕作技术与管理经验,进一步推动江西省耕地产出与资源、环境协调发展。     

Fixed-Term Contracts and Labor Market Duality in France

The French labor market is segmented between permanent and temporary workers. The second category has difficulty in getting an open-ended contract. This paper aims at depicting workers on short-term contracts and shows the consequences on their professional career are negative and significant. A large part of the wage gap between permanent and temporary workers remains unexplained by observable characteristics. They receive less on-the-job training and their likelihood of obtaining a stable job is lower than 30% after 1 year and a half. They have also a higher probability of being the adjustment variable in case of an economic negative shock. These different findings show the importance of using public policies to encourage transitions from fixed-term to permanent employment and reducing labor-market duality.