Insurance markets and unisex tariffs: is the European Court of Justice improving or destroying welfare?

We analyze the effects of mandatory unisex tariffs in insurance contracts, such as those required by a recent ruling of the European Court of Justice, on equilibrium insurance premia and equilibrium welfare. In a unified framework, we provide a quantitative analysis of the associated insurance market equilibria in both monopolistic and competitive insurance markets. We investigate the welfare loss caused by regulatory adverse selection and show that unisex tariffs may cause market distortions that significantly reduce overall social welfare.     

Take My Course,Please: The Effects of the Principles Experience on Student Curriculum Choice

Using a large multi-school sample, the authors examined how the characteristics and attitudes of students interact with the pedagogy and attributes of the instructor to influence students' decisions to study economics beyond the first semester. They found that students who have a predisposition to major in economics, who find economics relevant, who believe they understand economics as well as their classmates, and who expect higher grades in economics relative to their other classes are more likely to continue. They found evidence that teaching techniques and evaluation methods influence all of these factors except for the predisposition to major in economics. Some, but not all, of these techniques are particularly successful in influencing the decisions of female students.     

The impact of FDI on host countries: the analysis of selected service industries in the Visegrad countries

Foreign direct investments are substantial in the services sector in the Visegrad countries. In this article, we analyse the impact of FDI on the host economy in four selected service industries in two areas: export and employment. FDI in the four selected service industries differ in terms of their vertical or horizontal nature: in business services FDI is predominantly vertical; in financial services and telecommunications it is predominantly horizontal; while in computer-related service activities both types can be found. According to our results, the impact on the host economy differs in the four service industries. We found a positive and significant impact on exports in vertical business services and in horizontal telecommunications services, and on employment in business services and, to a lesser extent, in financial services. The positive impact either diminished or disappeared during the global recession of 2008–2009. The comparison of the four Visegrad countries demonstrates the heterogeneous intensity and significance of this impact, indicating their different specialisations in the analysed services industries.     

Motorcycle Helmet Laws and Motorcyclist Fatalities

We employ panel data over a 22-year period to study the impact of state laws mandating helmet use by motorcyclists. We find that helmet laws are associated with an average 29–33% decrease in per capita motorcyclist fatalities. However, since voluntary helmet wearing rates are higher in harsher climates, the efficacy of helmet laws varies directly with the warmth of a states climate. Repeal of helmet laws in the 1970s and subsequent re-adoption in the late 1980s and early 1990s have had roughly symmetrical effects on fatalities. Alcohol consumption and the number of police available to enforce traffic laws also significantly effect motorcyclist fatalities.     

The Determinants of Hispanic Representation in Municipal Government

In recent years Voting Rights Act cases brought by Hispanic litigants challenging local election systems have proliferated. This article analyzes the effects of election systems and demographic factors on the electoral success of Hispanics in municipal elections. Ability to speak English well and educational attainment of non-Hispanics are important factors that boost Hispanic representation. On average district elections enhance Hispanic representation, though the impact of district elections varies directly with the level of residential segregation. Although some Blacks may support Hispanic candidates, I do not find any significant effects of increases in Black population on the electoral success of Hispanics.     

Scope-of-practice regulation: Physician control and the wages of non-physician health-care professionals

We analyze the impact of licensing statutes that limit physician control over non-physician health-care providers. Contrary to the standard capture theory of regulation, we find that physical therapists have devoted considerable effort to obtain passage of laws that ultimately result in lower wages. This seemingly perverse result is robust across different data sets and various specifications. There is limited evidence to suggest that some physical therapists who treat patients without a physician's referral benefit at the expense of other therapists. However, it seems that non-monetary rewards associated with professional independence are the primary benefit to therapists from elimination of physician control.The authors thank Bill Haley of Forum Publishing, Inc., Mark Goldstein of the American Physical Therapy Association, Barry Hirsch, Dave Macpherson, and Carl Schmertmann for graciously providing data used in this paper. We have also benefited from the comments and suggestions of Barry Hirsch, Dave Macpherson, Sam Peltzman, Beate Gregory Sass, and an anonymous referee. Any remaining errors are solely our responsibility.     

Numeraire portfolios and utility-based price systems under proportional transaction costs

In a discrete-time incomplete financial market with proportional transaction costs and with independent and bounded returns, we prove the existence of a consistent price system that can be written as the expectation of the discounted claim under the real-world probability measure P and not just under a martingale measure. In fact, the claim is then discounted by some specific dynamic portfolio called the numeraire portfolio as in the classical case of markets without transaction costs. For that specific numeraire, P will be a martingale measure. Naturally, the concept of a numeraire portfolio has here to be adapted to the concept of consistent price systems for markets with transaction costs. Moreover, again as in the classical case, the numeraire portfolio can be chosen as log-optimal portfolio. The same analysis works for power utility functions. However, then a change of measure is necessary. This paper applies methods from stochastic dynamic programming to finance.     

Optimal consumption and investment under partial information

We consider a stock market model where prices satisfy a stochastic differential equation with a stochastic drift process. The investor’s objective is to maximize the expected utility of consumption and terminal wealth under partial information; the latter meaning that investment decisions are based on the knowledge of the stock prices only. We derive explicit representations of optimal consumption and trading strategies using Malliavin calculus. The results apply to both classical models for the drift process, a mean reverting Ornstein-Uhlenbeck process and a continuous time Markov chain. The model can be transformed to a complete market model with full information. This allows to use results on optimization under convex constraints which are used in the numerical part for the implementation of more stable strategies. Supported by the Austrian Science Fund FWF, project P17947-N12. We thank two anonymous referees for their comments which led to a considerable improvement of the paper.     

Minority representation, election method, and policy influence

Recently a number of legal scholars have advocated jurisdiction-wide cumulative voting as a mechanism to promote minority representation. Among other benefits, they claim minority representatives will have greater policy influence if they are elected in at-large contests rather than from single-member districts. We test this proposition by estimating the deter-minants of minority hiring practices. We find increases in the proportion of black representatives on a city council are positively correlated with the percentage of black police recruits. However, holding constant black representation, the impact of black councilors on municipal hiring is enhanced when councilors are elected at-large rather than by district.     

The workers' right to know,participate and refuse hazardous work: A manifesto right

This paper argues that the deepening and widening of existing worker rights in work environment issues is a necessary condition to promote much needed reform in present day industry, and to reduce the frequency and severity rate of accidents and incidence of industrial disease.