Contagion as a domino effect in global stock markets

This paper shows that stock market contagion occurs as a domino effect, where confined local crashes evolve into more widespread crashes. Using a novel framework based on ordered logit regressions we model the occurrence of local, regional and global crashes as a function of their past occurrences and financial variables. We find significant evidence that global crashes do not occur abruptly but are preceded by local and regional crashes. Besides this form of contagion, interdependence shows up by the effect of interest rates, bond returns and stock market volatility on crash probabilities. When it comes to forecasting global crashes, our model outperforms a binomial model for global crashes only.     

A High Road to Sustainability? Wildflower Harvesting,Ethical Trade and Social Upgrading in South Africa's Western Cape

This paper evaluates the outcomes from an ambitious wildflower harvesting programme in South Africa's Western Cape, which has sought to achieve positive outcomes in terms of socio‐economic development and biodiversity conservation. Indigenous wildflowers, harvested according to conservation principles, are processed into ‘Cape Flora’ bouquets and sold into international and domestic markets. The principal supply chain provides an example of ethical trade due to the explicit environmental and social standards that are required at local sites of production. The incorporation of such standards represents an attempt to engender economic and social upgrading within the value chain. In this sense, the programme is consistent with dominant policy discourses, which suggest that exploiting potentially profitable niches within international trade flows represents a ‘high road’ to economic growth and transformation. The paper focuses upon the job creation and social impacts of the programme in the context of efforts to overcome South Africa's deeply entrenched socio‐economic disparities and high poverty levels. Despite impressive growth in production and exports during the global financial crisis, there have been mixed outcomes in terms of benefits to stakeholders at the upstream end of the supply chain. The paper concludes by considering the extent to which local initiatives operating under the framework of ethical trade possess the potential to facilitate effective social and economic upgrading.     

Implementing new business models: What challenges lie ahead?

What strategic choices do business leaders make when implementing new business models? This study tries to answer this question by analyzing the development of several business model innovations that were new to the industry. We find that business model innovators face four strategic trade-offs and accompanying tensions during the implementation of their business model innovation process: (1) the level of independence granted to the developer (independence vs. dependence), (2) the degree to which the roadmap is planned in advance (discovery vs. planned execution), (3) the degree to which the value proposition challenges the status quo (challenging vs. maintaining status quo), and (4) the rigor to which business model innovators preserve the logic of the initial value proposition (solid vs. fluid logic). Our in-depth analysis reveals that business model innovators make pragmatic decisions that may deviate from the guidelines offered by existing literature, and we offer insights into the drivers behind these decisions.     

The protective effect of fences: providing protection to the 0-4 year-old

Abstract

In this study the minimum standards are investigated which must be imposed on fences in order for them to act as a barrier to children from the particular risk group (2 and 3-year-olds).The study sought to establish the minimum height usable, because a fence of this type can be climbed more easily by older children and young people, and hence damage due to vandalism (by these older people in order to pass it) is less likely to occur. This is very important, because damage of this kind also destroys the fence's ability to protect very young children.

By means of a literature study parameters were identified that are relevant for the ease with which fences can be climbed. These include: personal characteristics and fence characteristics such as: height, geometry (chain-link fabric, bars, and welded steel wires), top geometry and post flexibility. A design set-up was made having 5 different types of fences and the effective height of the fence could be changed during the study by means of steps in front and behind the fence.

The testers were 31 boys and 35 girls divided according to age (by half years), producing 7 groups of roughly 10 children each. The children were asked to climb these fences. Information is given on the percentage of children (per age group) stopped by each fence, and the mean time required for successful attempts. It must be concluded that it is hard to prevent somewhat older children (4-5 yrs old) from climbing a fence. The fence having flexible posts and the one having bars were found to be the most effective.     

The moral significance of gestures

The concept of the gesture is explored in relationship with its moral significance rather than, for example, its aesthetic significance. It is argued that the concept can be used in order to make clear how morality relates to the body. This is not to suggest that gestures can be neatly defined. On the contrary, they always seem to be ambivalent and somewhat nebular. However, it will be shown that some of their significance might well be related to popular concepts such as ‘transparency’, ‘authenticity’, ‘integrity’ and ‘responsibility’. In order to make this clear, the role of some particular gestures in politics and organizational life, most notably ‘apology’ and ‘trust’, will be discussed throughout the paper.     

Impact of the WTO on Agricultural and Food Policies

Most studies on the impact of WTO agreements on policies are ex ante simulations or focus on trade effects. We estimate ex post the impact of the WTO on agricultural policies, including both the total transfers by the policies and the policy instruments used, in particular their market distortions. We use OECD data on total support and instrument choice in agricultural policy. Our empirical analysis provides evidence that the WTO did not cause a significant reduction in the total amount of support to agriculture but that it caused a significant shift from distortionary to less distortionary instruments.     

On a waiting time problem in physiology

Samenvatting
Voor een wachttijdprobleem, dat ter sprake komt in de quantum theorie van de visuele waarneming en bij een onderwerp uit de theoretische neurofysiologie, wordt een benaderde oplossing gegeven.
Vergelijkingen worden gemaakt met de exacte oplossing en met uitkomsten van een Monte Carlo simulatie.     

On the impact of managerial bonus systems on firm profit and market competition: the cases of pure profit,sales, market share and relative profits compared

By designing remuneration schemes based on a bonus rewarding specific firm‐level outcomes, the owners/shareholders of a firm can manipulate the behavior of their managers. In practice, different bonus anchors take center stage: some are profit‐based, others use sales as the key yardstick and still different ones focus on relative performance vis‐à‐vis a peer group. In this paper, we focus on the impact of remuneration schemes on firm‐level profitability. The profit effect is investigated for (all possible combinations of) four bonus systems using delegation games. In the context of a linear Cournot model for two or three firms, we model a two‐ or three‐stage decision structure where, in the first stage (or first two stages), an owner decides on the bonus system for his manager and where, in the final stage, the manager takes the daily output decision for her firm. It appears that the bonus system based on relative (profits) performance is superior throughout. Copyright © 2008 John Wiley & Sons, Ltd.     

A neural network unification

We study the relation between the asymptotic behaviour of synchronous Boltzmann machines and synchronous Hopfield networks. More specifically, we consider the relation between the pseudo consensus function that is used in analyzing Boltzmann machines and the energy function that is used in the study of Hopfield networks. We show that for small values of the control parameter, synchronous Boltzmann machines and synchronous Hopfield networks compute global respectively local maxima of the same function.