The long-run determinants of inequality: What can we learn from top income data?

This paper studies determinants of income inequality using a newly assembled panel of 16 countries over the entire twentieth century. We focus on three groups of income earners: the rich (P99–100), the upper middle class (P90–99), and the rest of the population (P0–90). The results show that periods of high economic growth disproportionately increases the top percentile income share at the expense of the rest of the top decile. Financial development is also pro-rich and the outbreak of banking crises is associated with reduced income shares of the rich. Trade openness has no clear distributional impact (if anything openness reduces top shares). Government spending, however, is negative for the upper middle class and positive for the nine lowest deciles but does not seem to affect the rich. Finally, tax progressivity reduces top income shares and when accounting for real dynamic effects the impact can be important over time.     

Econometric analysis of copyrights

This paper explores the impact of copyrights on firm value and on the demand for firm output. Using panel data on franchise value and ticket sales from the National Football League over the 1991–2000 period, we analyze the effect of copyrights (in this case, team logos) using several parametric estimators, the Arellano and Bond [1991. Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies 58, 277–297] dynamic panel data estimator, and a semi-non-parametric method based on difference-in-differences propensity score matching. We find a negative effect of logo changes on franchise value that is robust across multiple specifications. In addition, logo changes also appear to have a moderate positive, albeit not particularly robust, impact on ticket sales.     

THE ROLE OF INVENTORIES AND SPECULATIVE TRADING IN THE GLOBAL MARKET FOR CRUDE OIL

We develop a structural model of the global market for crude oil that for the first time explicitly allows for shocks to the speculative demand for oil as well as shocks to flow demand and flow supply. The speculative component of the real price of oil is identified with the help of data on oil inventories. Our estimates rule out explanations of the 2003–2008 oil price surge based on unexpectedly diminishing oil supplies and based on speculative trading. Instead, this surge was caused by unexpected increases in world oil consumption driven by the global business cycle. There is evidence, however, that speculative demand shifts played an important role during earlier oil price shock episodes including 1979, 1986 and 1990. Our analysis implies that additional regulation of oil markets would not have prevented the 2003–2008 oil price surge. We also show that, even after accounting for the role of inventories in smoothing oil consumption, our estimate of the short‐run price elasticity of oil demand is much higher than traditional estimates from dynamic models that do not account for for the endogeneity of the price of oil. Copyright © 2013 John Wiley & Sons, Ltd.     

Digitalisierung im Gesundheitswesen — zwischen Datenschutz und moderner Medizinversorgung

The digital transformation of the healthcare branch is important and unstoppable. The enormous possibility of digitalisation to redesign and enhance processes has been shown in other branches. Digital technologies offer the similarly large potential to improve the quality and efficiency of healthcare services. However, in terms of digitalisation, the German health system lags behind other European countries. But given a lack of available evidence, the effects of the digitalisation of the healthcare system cannot be reliably evaluated. Digital access to patient data necessitates constructive error cultures in organisations in order to limit defensive medicine. And digital access to health information necessitates individual competence in searching and using this information for participatory decision-making. As with all technological progress, information security is very important in order to gain citizens’ confidence in a digital healthcare system. Thus, it is necessary to simultaneously pursue both enhanced privacy standards and state-of-the-art medical technology.     

The Impact of FDI Inflow on Domestic Firms’ Uptake of CSR Activities: The Moderating Effects of Host Institutions

This study examines whether foreign direct investment (FDI) inflow helps or hinders local firms’ uptake of corporate social responsibility (CSR) activities in a developing host country. The study further examines the interaction effect of host institutions on the relationship between FDI inflow and local firms’ uptake of CSR activities. Results of hierarchical regression analysis of data from a sample of 227 local firms in Ghana, reveal that local firms’ uptake of CSR improves significantly with an increasing inflow of FDI through knowledge transfer. Host institutions are also found to influence the transfer of CSR activities from foreign firms to local firms. However, when the quality of institutions is very high, the impact of FDI on local firms’ CSR activities diminishes. Research and practical implications of these findings are discussed. © 2015 Wiley Periodicals, Inc.     

To buy or not to buy? The value of contradictory analyst signals

We study the predictive ability of individual analyst target price changes for post-event abnormal stock returns within each recommendation category. Although prior studies generally demonstrate the investment value of target prices, we find that target price changes do not cause abnormal returns within each recommendation level. Instead, contradictory analyst signals (e.g., strong buy reiterations with large target price decreases) neutralize each other, whereas confirmatory signals reinforce each other. Further, our analysis reveals that large target price downgrades can be explained by preceding stock price decreases. However, upgrades are not preceded by stock price increases, thereby demonstrating asymmetric analyst behavior when adjusting target prices to stock prices. Our results suggest that investors should treat recommendations with caution when they are issued with large contradictory target price changes. Thus, instead of blindly following a recommendation, investors might put more weight on the change in the corresponding target price and consider transaction costs.     

Capital incentives and adequacy for securitizations

This paper analyzes the capital incentives and adequacy of financial institutions for asset portfolio securitizations. The empirical analysis is based on US securitization rating and impairment data. The paper finds that regulatory capital rules for securitizations may be insufficient to cover implied losses during economic downturns such as the Global Financial Crisis. In addition, the rating process of securitizations provides capital arbitrage incentives for financial institutions and may further reduce regulatory capital requirements. These policy-relevant findings assume that the ratings assigned by rating agencies are correct and can be used to build a test for the ability of Basel capital regulations to cover downturn losses.     

Is the Organisation for Economic Co-operation and Development Ready for China?

Abstract:

The re-emergence of China as a global economic power has intensified calls for the urgent reform of Western-dominated international organizations. We evaluate efforts by the Organisation for Economic Co-operation and Development (OECD) to adapt to the challenge of China. From the first decade of the 2000s, the OECD has undertaken reforms to boost its significance as a key policy actor in the global economy. Part of this effort involves bringing China closer to the organization. To date, only limited progress has been made. We set out three bold policy reforms the OECD could implement that would deepen the OECD’s relationship with China as well as with other emerging economies.