On the Priority of Labor Over Capital

In his encyclical Laborem Exercens, John Paul II asserts the principle of the priority of labor over capital. The purpose of this article is to examine this principle. The conflict between labor and capital is often noted as an essential part of capitalism. There is a long tradition of assigning more significance to labor than to capital. In fact, the classical economists argued that labor determined the “value” of a good. To understand this conflict, we must first review what is capital and its role in capitalism. We will then look at John Paul II’s assertion of the principle of labor over capital, followed by a review of how economists have understood the relationship between labor and capital. Neoclassical economists dismiss labor and capital as classes, so they believe there is no conflict. We examine one neoclassical economist’s claim of a gap in the principle of the priority of labor over capital by not including finance capital in the analysis. We demonstrate that the Church’s teachings on usury answer the objections raised. We conclude with a review of the implications of the priority of labor over capital.     

What drives fluctuations in exchange rate growth in emerging markets – A multi-level dynamic factor approach

Historically, exchange rates in many emerging economies have been volatile. We use a dynamic hierarchical factor model to investigate the driving forces behind these fluctuations in exchange rate growth and find that in recent years, especially since the Great Recession, the common (world) factor has become more important. We also find that, since 2009, US monetary policy and Chinese economic growth have had much greater effects on emerging market exchange rate growth fluctuations. The historical decomposition indicates that 18.8% and 23% of the variations in the world factor after 2009 can be explained by US monetary policy shock and Chinese industrial production shock, respectively.     

The ‘minimal’ state reconsidered: governance on the margin

Classical liberal scholars have defined a “minimal state” as performing certain basic functions that include the provision of policing, courts, and national defense. We argue that these functions need not be fully provided by the state. Private provision of all three of these functions exists. Thus a truly minimal state would provide these functions only on the margins where private provision fails. Thus, a truly minimal state is much more minimal than scholars have traditionally envisioned.

     

Corporate Social Responsibility Disclosures and Investor Judgments in Difficult Times: The Role of Ethical Culture and Assurance

Journal of Business Ethics - We conduct an experiment with 459 nonprofessional investors to examine whether they evaluate companies differently based on management’s stated purpose for...     

The Accountability and Independence of the Auditors-General of Australia: A Comparison of their Enabling Legislation

This paper compares the enabling legislation of the nine auditors-general of Australia from perspectives of public-sector accountability and auditor independence. Following on from the Joint Committee of Public Accounts (JCPA) 1989 and 1996 reports, and in particular English and Guthrie (2000), this study finds general similarities in the enabling legislation for all auditors-general, and striking similarities between the legislation of the commonwealth and Victoria. The policy implications of this study's findings are that for all auditors-general provisions in their enabling legislation could be further strengthened     

Understanding Top Management and Organizational Change Through Demographic and Processual Analysis*

abstract Top management theory has been strongly influenced by demographic studies of top management teams (TMTs), but not by research into organizational adaptation to conditions of extreme institutional turbulence. This article analyses the transformation of a post‐socialist enterprise through a combination of demographic and processual methods to develop an enriched account of the micro‐processes through which top management constructed organizational change. Adding layers of narrative data and processual explanation directly addresses the well rehearsed problems in demographic TMT studies. From the findings, we propose a set of theoretical arguments that conceptualizes top management in terms of management regimes, to which TMTs are politically tied and through which they seek to realize their values and strategies in organizational outcomes.     

A general equilibrium model of changing risk premia: theory and tests

We derive and test a dynamic discrete-time model of asset returns.Both the risks of individual securities and equilibrium riskpremia change predictably in the model, but these changes canbe attributed to movements in the returns and prices of onlytwo well-diversified portfolios. Any other components of returnsshould be unpredictable. Using the generalized method of moments,the model is estimated and tested on portfolios of equities.We find the data supportive of the model's restrictions, evenwhen instruments designed to capture the January effect areemployed.     

Immigration,international capital flows,and long run income distribution in Canada

Conclusion This study derives long-run income distributional impacts of immigration and capital flows in a general equilibrium model of Canada. While each factor is its own enemy, results indicate that capital and skilled professional labor are enemies as well. Both of these productive inputs are friends of other labor groups, which are common enemies. Factor friendship patterns are useful in evaluating income distributional impacts of a variety of policies designed to influence the international flow of productive labor and capital.     

Oil price shocks in a portfolio-balance model

In the 1970s oil price increases were often associated with downward pressure on the foreign exchange value of the dollar. In order to identify the factors generating this association, we examine an oil price shock in a portfolio-balance framework where a wealth transfer is generated by altered current account positions. We show that the exchange-rate impact of higher oil prices depends importantly on the asset prefernces of both oil importers and oil exporters, as well as exchange rate expectations, which are influenced by countries' abilities to adjust to higher oil prices.