Inflation,real economic growth and unemployment expectations: an empirical analysis based on the ECB survey of professional forecasters

Expectations are at the centre of modern macroeconomic theory and policymakers. In this article, we examine the predictive ability and the consistency properties of macroeconomic expectations using data of the European Central Bank (ECB) Survey of Professional Forecasters (SPF). In particular, we provide evidence on the properties of forecasts for three key macroeconomic variables: the inflation rate, the growth rate of real gross domestic product and the unemployment rate.     

Legalistic organizational responses to catastrophic illness: The effect of stigmatization on reactions to HIV/AIDS

The HIV/AIDS epidemic has focused increased attention on catastrophic illnesses in the workplace, and because of the stigmas associated with HIV/AIDS, it raises three primary concerns for organizations: (1) organizational avoidance of legal sanctions and litigation; (2) the maintenance of organizational legitimacy; and (3) organizational protection of employee rights. Although many organizations adopt legalistic responses to cope with these concerns, the analysis presented in this article suggests that while legalistic approaches function well to protect organizational interests in terms of both legal liability and legitimacy, the are only partially able to protect employee rights. Drawing upon the limited literature on HIV/AIDS in the workplace, this article presents an agenda for future research on organizational responses to HIV/AIDS.     

Law without justice: The dilemmas of formalization and fairness in the legalistic organization

There is growing evidence of a litigation mentality rampant in organizations, which has created a legalistic mindset in many managers. Increasingly, managerial decisions are becoming dominated by a concern for what is legally defensible at the expense of broader social considerations such as justice and fairness. The papers in this special issue explore how this legalistic mindset has created new organizational and social dilemmas, and situations of law whithout justice.     

Life histories in housing research: the case of Pakistanis in Glasgow

The discussion centers on three key criticisms of life history techniques, which are reviewed and evaluated with reference to data from research on Pakistani housing histories in Glasgow. Firstly, the problem of bias is reframed as an issue of reflexivity, which enhances research findings. Secondly, awareness of the cultural construction of life histories allows greater depth of analysis. And thirdly the problem of the relationship between the life history and wider social forces is argued to increase awareness and understanding of social actor agency. In conclusion, we argue that life history techniques can develop research on housing careers, particularly of Pakistanis, provided certain of their properties are recognised in the process of analysis.     

The Determinants of Intra-Industry Trade in Insurance Services

In light of the growing significance of trade in financial services, and the emphasis placed on trade in financial services during the Uruguay round of trade negotiations, this article is the first study of the determinants of intra‐industry trade (IIT) in insurance services. The article analyzes and measures the magnitude of IIT in insurance services for the United States. The empirical results of the determinants of IIT indicate that foreign direct investment in insurance services (FDI) is a significant contributor to the volume of trade in insurance services. These empirical findings confirm the new theoretical trade models that, unlike the traditional trade theory that considered trade and foreign direct investment in insurance services as substitutes, trade and FDI complement each other and hence multinational insurance companies are contributing to an increase in the volume of trade in insurance services. Furthermore, this study shows that trade intensity between the United States and its trading partners leads to product differentiation in insurance services and hence an increase in consumer welfare.     

From global start-ups to the borderless firm: Why and how to build a worldwide value system

Although the original concept of international new ventures included the geographic configuration of value activities, the subsequent development of the literature has gradually abandoned the concern about the geographic configuration of both input sourcing and output marketing to concentrate almost exclusively on the latter. Therefore, this paper argues that there is a need to re-focus the research so as to figure out how and why some companies are borderless. Borderless firms are defined as the result of the combination, early on, of geographically dispersed resources and capabilities, defying the home-base logic. A borderless firm presents the following characteristics (or a combination of them) from inception (or shortly thereafter): (i) value-added activities dispersed across different countries and regions; (ii) entrepreneurs not bounded by a home base; (iii) multinational founders and/or management teams; and (iv) a multinational workforce. To enquiry into this issue, the study uses five case studies of borderless firms. The results advance the understanding of the motives and processes behind the development, early on, of a borderless configuration of value activities.     

IMMIGRANT RELATIVE WAGES AT THE GREAT RECESSION: EVIDENCE WITH MATCHED EMPLOYER‐EMPLOYEE DATA FOR SPAIN

The article examines relative wages of immigrants in Spain, with a particular focus on the impact of the Great Recession. The empirical analysis is restricted to men and is based on matched employer‐employee microdata and the decomposition techniques of Juhn et al. (1991, 1993) and Fortin et al. (2011). Our results show that the significant native‐immigrant wage gap that exists both in terms of average wages and of differentials along the wage distribution is essentially explained by differences in the endowments of observed characteristics so that, in general, immigrants tend to receive a similar wage treatment than Spaniards with analogous observed attributes. On the other hand, the Great Recession has had a noticeable impact on the relative wages of immigrants, given that the significant increase of the native‐immigrant wage gap observed during the previous expansionary period was mitigated during the economic downturn due to composition effects arising from the severe employment destruction pattern.     

Seapower and US Forward Presence in the Middle East: Retrenchment in Perspective

The winding down of military operations in Iraq and Afghanistan has prompted a scholarly debate around America’s evolving strategic role and posture in the broader Middle East. Allegedly, its isolated geographical position and “seapower” condition would allow the US to behave as an “offshore balancer”, by pulling back militarily, retreating from alliances and formal security commitments and relying on the different regional powers to balance each other. However, it remains unclear to what extent a seapower like the US would be able to effectively manipulate the balance of power in the Middle East from offshore. An examination of US strategy in the Middle East from 2009 to 2015 suggests that the main puzzle Washington confronts is not so much whether to retreat offshore or remain engaged onshore, but rather to work out the terms of onshore engagement. As this article shows, current US strategy in the Middle East revolves around the need to reconcile two seemingly contradictory sets of pressures. The first is that war fatigue, financial pressures and the ongoing reorientation of military-strategic resources towards the Asia-Pacific theatre do require that the US cuts back on its engagement elsewhere, including in the Middle East. The second relates to Washington’s deep-seated conviction that there is a direct correlation between US forward presence and the preservation of a favourable balance of power in the Middle East, which is itself critical to the security of other regions, including the Asia-Pacific. By discussing the relationship between seapower and forward presence, this article places US strategic retrenchment in the Middle East in perspective. In particular, the article transcends the rather vague notion of “balancing” and concentrates on US perceptions about which geographical areas in the Middle East need to be balanced, and how, i.e., through which alliances, instruments and policies.     

Trade openness and government size of small developing countries

This paper examines the causal effect that trade openness has on government size in small developing countries (SDCs). We use the construction of the trade cost variables based on Baltic Dry Index in primary goods as instruments of trade openness to address the endogeneity issue. We find that the increase in trade openness leads to an increase in government size: a 1 percent expansion in trade openness (trade GDP ratio) raises government consumption over GDP ratio by approximately 0.1–0.2 percentage points on average. Its quantitative significance emphasizes the importance of rethinking the costs and benefits of trade openness for SDCs.     

Governance and stock market performance

This study uses international asset pricing models to investigate the link between the quality of government institutions and the performance of global stock markets. The results demonstrate a significant positive association between stock market performance measures and the quality of the institutional environment. Performance measures examined for the cross-section of countries were the average monthly stock index excess returns and the Sharpe ratio. All measures of performance were adjusted for global and local risk factors known to explain their international variation. The quality of governance is also found to be negatively associated with stock market total risk and idiosyncratic risk, consistent with the notion that stable institutions are linked to reduced variations in equity returns. These findings suggest countries with better-developed governance systems have stock markets with higher returns on equity and lower levels of risk. The results lend support for the view that a precondition for financial market development is the improvement of the institutions which govern the process of exchange.