INSURANCE BY GOVERNMENT OR AGAINST GOVERNMENT? OVERVIEW OF PUBLIC RISK MANAGEMENT POLICIES

In what contexts is it desirable that the government, rather than the private sector, takes on the role of an insurer and helps people reduce risks? Our discussion implies that while in a number of areas individuals benefit from well-designed insurance provided by their government, ill-designed public policies (for example existing pay-as-you-go pension systems) force individuals to insure against their government. It is further discussed how governments could improve their risk managing role in many areas by using income contingent loans, provided the country has high-quality institutions and governance. Such loans to artists, sportspeople, flood victims or collapsing financial institutions would replace the existing nonrepayable transfers, grants, subsidies and bailouts. Using a simple efficiency-equity-sustainability framework for comparing income contingent schemes with conventional public and private insurance policies, we document that this would enable governments to extend their insurance assistance to a greater number of people and institutions – in a way that is not only equitable but also efficient and fiscally sustainable.     

WHO REALLY WANTS TO BE A MILLIONAIRE? ESTIMATES OF RISK AVERSION FROM GAMESHOW DATA

This paper estimates the degree of risk aversion from one of the most popular TV gameshows ever. The format of the show is straightforward; it involves no strategic decision making; we have a large number of observations; and the prizes are cash, which is paid immediately and covers a large range: from £100 up to £1 million. We provide non‐parametric estimates of the utility function and then we test some parametric restrictions. We find that, although the restriction to CRRA utility is statistically rejected, a log function approximates the utility function quite well over a large range of potential winnings. Copyright © 2013 John Wiley & Sons, Ltd.     

企业文化,战友OR敌人?

如果企业在策略变革中不能做好文化调适,任何策略转型都是徒劳无功的。     

外来大鳄冲击OR促进杭州楼市?

自从去年底华润、嘉里进驻杭城以来,今年年初杭州市政府携3000多亩土地到香港进行招商推介。此后,凯德置地、万科等地产大鳄纷至杭州攻城掠地。这对一直是本土开发企业上演“诸侯争霸战”的杭州房地产市场意味着什么?本土企业是继续“与虎谋皮”,还是放弃杭州退而求其次?     

沙龙第二轮 五月楼市:暖阳OR斜阳?“红五”OR“悬五”?

业界有金三银四红五的说法,但政策调控以及复杂的局势(加息、通胀、人民币升值等)也令今年的楼市充满了悬念,这个五月会是红五还是悬五?会否呈现五月暖阳?     

DEVELOPMENT THROUGH FAIR TRADE: CANDOUR OR DECEPTION?

Proponents of development through Fair Trade allege the movement can seek out the most disadvantaged in ways an impersonal market cannot. While in theory Fair Trade could provide these qualities in a market‐based framework, the evidence herein shows the current Fair Trade movement is failing when measured against these objectives.     

欧美OR日韩哪种模式更适合?

无论是借鉴欧美企业集团产销合一为主导的模式,还是日韩初期产销分离的模式,都不能简单一概而论为适用的转型模式     

重生OR死亡? 探析房企前行方向

正五年之内开发商仍然可以保持两位数的利润,但五年后将成为寡头地产,土地会越来越集中在地产大鳄手中,中小开发商越来越多地被淘汰出局。所以,在这五年问,转型、升级关乎着企业的生死存亡。     

DO WATER-RICH REGIONS HAVE A COMPARATIVE ADVANTAGE IN FOOD PRODUCTION? IMPROVING THE REPRESENTATION OF WATER FOR AGRICULTURE IN ECONOMIC MODELS

With growing demand for fresh water and uncertain supplies, there is an increasing concern about future water scarcity. Since most freshwater withdrawals are for agriculture, reliance on water embodied in imported food (trade in ‘virtual water’) is a possible strategy to provide food to water-stressed regions while conserving their scarce supply for other purposes. To evaluate this proposition, we extend a model of interregional trade by (1) defining endowments of water that cannot be exceeded, (2) allowing simultaneous operation of rainfed and irrigated agriculture, and (3) distinguishing sub-regional endowments within a larger economic region. An application to the Mexican economy compares region-specific water abundance with economic comparative advantage under alternative scenarios. We conclude that the water-rich regions of Mexico are relatively high-cost producers of food and that they do not pick up the slack even when the lowest-cost Mexican regions are constrained by binding water constraints.     

STATE EDUCATION IN THE NINETEENTH CENTURY: DEMANDED OR IMPOSED?

This article challenges the popular perception that the free market was unable to supply education to meet the needs of nineteenth-century Britain. Provision of education in fact largely accorded with parental demand, and this level of voluntary consumption was optimal for the time. Government intervention could therefore be ineffective at best, if not actively harmful.     

CONTROLLING BANKERS' BONUSES: EFFICIENT REGULATION OR POLITICS OF ENVY?

The positive relationship between bank CEO compensation and risk-taking is a well-established empirical fact. The global banking crisis has resulted in a chorus of demands to control bankers' bonuses and thereby curtail their risk-taking activities in the hope that the world can avoid a repeat in the future. However, the positive relationship is not a causative one. In this paper we argue that an implicit too-big-to-fail policy provides the incentive for banks to take excessive risks and design compensation packages to deliver high returns. A credible no-bailout policy will have a better chance of curbing excess risk-taking than controlling bankers' compensation.     

BINGE BORROWERS OR RATIONAL CONSUMERS? THE FSA AND GOVERNMENT FAILURE

The FSA seeks to address the putative financial incompetence of the borrowing public by improving its financial capability. The response of rational agents to asset price inflation in the UK is one indication of the competence with which many people use innovations in the financial services industry. The FSA succeeds only in shielding government failures in the money and housing markets.     

THE ORANGE BOOK – TURNING RIGHT OR CHANGING GEARS?

The Liberal Democrats becoming kingmakers in 2010 did not depend solely on the numbers adding up on May 5th. Did The Orange Book pull the party to the right, making coalition with the Tories a meeting of minds? Or was it better viewed as an element in an overall strategic shift towards greater professionalism, making a deal with either of the major parties more likely?     

CREDIT DEFAULT SWAPS – WEAPON OF MASS DESTRUCTION OR RELIABLE INDICATOR?

Credit Default Swaps (CDS) are said to increase systemic vulnerability, but they also serve as an ex‐ante indicator of default probabilities, more finely‐tuned and more responsive than ratings agency reports. And they provide a useful mechanism for trading risk and an incentive for good management by businesses and governments.     

LONG DARK SHADOWS OR INNOVATIVE SPIRITS? THE EFFECTS OF (SMOOTHING) BUSINESS CYCLES ON ECONOMIC GROWTH: A SURVEY OF THE LITERATURE

Abstract It is argued that fiscal policy can play a part in preventing a possible downward spiral or be instrumental in achieving a higher long‐term path of growth. Never before has this argument been advanced as frequently as in the current economic crisis. However, the economic literature – an overview of which is given here – does not provide an unambiguous answer, either theoretically or empirically, to the question of the relationship between (the smoothing of) cyclical fluctuations and long‐term growth. In this context, two main contrasting explanatory paradigms can be identified: Schumpeter’s concept of creative destruction and the learning by doing hypothesis. Even if it were possible to identify the relationship more clearly on this basis, it is important not to lose sight of the problems associated with the real‐time assessment of the current economic situation, time lags and political economic incentives even in difficult times.