Politics of Trade in the USA and in the Obama Administration: Implications for Asian Regionalism

Over the next four years, the Obama administration will face a series of strategic choices in forging policies to respond to a growing momentum for advances in Asian regional structures. Though faced with domestic political challenges; not least from within his own Democratic party – President Obama and his advisers will need to set a course for the reassertion of US leadership in constructing a trans-Pacific vision, through new US-based free trade agreements, signing on to existing agreements such as the P-4 (Singapore, New Zealand, Brunei, the Philippines), or consolidating existing free trade agreements among Asia Pacific Economic Cooperation (APEC) nations. In pursuing this vision, the US should take advantage of the fact that the next three APEC leaders meetings are in Singapore (2009), Japan (2010), and the USA (2011); a sequence ripe for synergistic teamwork.     

A proof of asymptotic normality for some VARX models

Here we present a proof of the asymptotic normality of least squares estimates for stable multivariate autoregressive models excited by a deterministic second order input signal.     

Money Metric, Consumer Surplus and Welfare Measurement

The paper provides a rigorous derivation of the 'welfare triangle approximation' (WTA), which is at the centre of cost–benefit analysis. The result is generalized by showing that the WTA is one of two dual expressions, one of which approximates the change in real consumption, the other the change in the cost of living. The result is based on a correction of a proof attempted by Hicks. Many other derivations are also given, each based on a different definition of the theoretical functions to be approximated. The final result is the following: each of the empirical variations corresponds to a range of theoretical variations. The edges of the range are theoretical Laspeyres and Paasche variations which are approximated linearly; the interior region of the range is approximated quadratically; the centre of the range is replicated exactly by the empirical measures.     

Analysis of deviance and of social classes — the impact of methodological research

In an analysis of deviance and social classes, an original methodology is used as a means of progress in the theoretical domain, which seeks a resolution of the now traditional consensus vs. conflict debate by introducing two hitherto ignored aspects: (1) this debate cannot be clarified by reference to norms or values that are abstractly described, but only in relation to the legitimacy of the intervention of a particular social institution as the result of a particular problematic behavior; and (2) the comprehension of these phenomena and their social interpretation necessitates an understanding of their meaning and of the ideological configurations that are the framework in which these judgements of institutional legitimacy are made. Indeed, this second aspect constitutes the working hypothesis of the analysis, using multiple-choice questionnaire data (N=804) concerning the social representation of deviance which are analyzed by an original method of hierarchically ascending classification analysis, called cross-classification. This method, which crosses an automatic classification analysis of the individuals with a similar analysis of the variables, produces significant nodes within the data that determine and describe the five archetypes of social representation of deviance. These significant nodes or archetypes are then analyzed further with the application of a factorial correspondence analysis.     

On finite-time ruin probabilities for classical risk models

Abstract

Generally, the return of premiums without interest or with simple interest is provided for. It might, however, be worth while to notice that less complicated formulre are needed for the return of premiums with compound interest.     

The first-order approach when the cost of effort is money

We provide sufficient conditions for the first-order approach in the principal-agent problem when the agent’s utility has the nonseparable form u(y−c(a))$u(y-c\left(a\right))$ where y$y$ is the contractual payoff and c(a)$c\left(a\right)$ is the money cost of effort. We first consider a decision-maker facing prospects which cost c(a)$c\left(a\right)$ and with distributions of returns y$y$ that depend on a$a$. The decision problem is shown to be concave if the primitive of the cdf of returns is jointly convex in a$a$ and y$y$, a condition we call Concavity of the Cumulative Quantile (CCQ) and which is satisfied by many common distributions. Next we apply CCQ to the distribution of outcomes (or their likelihood-ratio transforms) in the principal-agent problem and derive restrictions on the utility function that validate the first-order approach. We also discuss another condition, log-convexity of the distribution, and show that it allows binding limited liability constraints, which CCQ does not.     

Scientist and public responses to BSE‐related risk: A comparative study

Social studies of risk repeatedly have found substantial divergences in the way that experts/scientists and members of the general public appraise risks associated with health and environmental hazards. However, empirical evidence for these differences remains controversial. A recent review of literature suggests in particular that divergences between experts and lay people may potentially result from confounding socio‐demographic factors. The purpose of the present article is to investigate and to compare how medical scientists and members of the general population reacted to BSE (“mad cow disease”) in France. A sample of 401 scientists belonging to the French Institute of Health and Medical Research (INSERM) and a representative sample of 902 French citizens were asked about their cognitive, affective and behavioural responses to BSE. Results show that non‐scientists tended to express much more concern about BSE‐related risk than scientists, even when socio‐demographic variables were controlled. However, (1) no significant differences were found between these two groups concerning subjective epidemiological predictions, and (2) scientists manifested greater avoidance of beef or beef by‐products avoidance following the BSE epidemic than lay respondents did. The implications of these paradoxical results are discussed.     

Causality Between Corporate Social Performance and Financial Performance: Evidence from Canadian Firms

This study assesses the causal relationship between corporate social performance (CSP) and financial performance (FP). We perform our empirical analyses on a sample of 179 publicly held Canadian firms and use the measures of CSP provided by Canadian Social Investment Database for the years 2004 and 2005. Using the “Granger causality” approach, we find no significant relationship between a composite measure of a firm’s CSP and FP, except for market returns. However, using individual measures of CSP, we find a robust significant negative impact of the environmental dimension of CSP and three measures of FP, namely return on assets, return on equity, and market returns. This latter finding is consistent, at least in the short run, with the trade-off hypothesis and, in part, with the negative synergy hypothesis which states that socially responsible firms experience lower profits and reduced shareholder wealth, which in turn limits the socially responsible investments.     

Erratum to: Ethics,Diversity Management,and Financial Reporting Quality

This article proposes and empirically tests a theoretical framework incorporating Reidenbach and Robin’s (J Bus Ethics 10(4):273–284, 1991) conceptual model of corporate moral development. The framework is used to examine the relation between governance and business ethics, as proxied by diversity management (DM), and financial reporting quality, as proxied by the magnitude of earnings management (EM). The level of DM and governance quality are measured in accordance with the ratings of Jantzi Research (JR), a leading provider of social and governance research for institutional investors. This DM score is part of an index developed by JR that investment managers use to integrate DM criteria into their investment decisions. As expected, a negative relation between corporate DM development and financial reporting quality is found while controlling for other factors known in the literatures on governance and accounting choices to affect earnings quality. Despite some caveats presented in conclusion, this study contributes to the ethics, governance, and financial reporting literatures by studying the dynamics between governance and ethics in the prevention of EM.     

The effects of upcoding,cream skimming and readmissions on the Italian hospitals efficiency: A population-based investigation

In this paper we analyze the effects of some distortions induced by the prospective payment system, i.e. upcoding, cream skimming and readmissions, on hospitals' technical efficiency. We estimate a production function using a population-based dataset composed by all active hospitals in an Italian region during the period 1998–2007. We show that cream skimming and upcoding have a negative impact on hospitals' technical efficiency, while readmissions have a positive effect. Moreover, the results indicate that private hospitals engage more in cream skimming than public and not-for-profit ones, while we observe no ownership differences regarding upcoding. Not-for-profit hospitals have the highest readmission index. Last, not-for-profit and public hospitals have the same efficiency levels, while private hospitals have the lowest technical efficiency.