Auditor liability rules under imperfect information and costly litigation: the welfare-increasing effect of liability insurance

This paper examines auditor liability rules under imperfect information, costly litigation and risk-averse auditors. A negligence rule fails in such a setting, because in equilibrium auditors will deviate with positive probability from any given standard. It is shown that strict liability outperforms negligence with respect to risk allocation and the probability that a desired level of care is met by the auditor if competitive liability insurance markets exist. Furthermore, our model explains the existence of insurance contracts containing obligations a type of contract often observed in liability insurance markets.     

Reimbursement schemes for hospitals: the impact of case and firm characteristics

We contribute to the debate on high-powered versus low-powered incentives in regulation by studying their heterogeneous impacts on different subpopulations, using data from the introduction of a high-powered prospective payment system (PPS) for hospital reimbursement in Germany. While no overall effect on quality or cost saving is found, our results support hypotheses drawn from an incentive and selection perspective: PPS reduces the length of stay of older relative to younger patients, of more severe relative to less severe cases, and in smaller relative to larger hospitals. Hospitals which adopted PPS earlier provide higher quality under PPS as proxied by the case-specific readmission rate. Our study also contributes to the health economic literature on hospital reimbursement as our data permits us to identify the treatment effect via different timings of adoption of PPS and to use a more accurate quality measure by following patients even when readmitted to other hospitals.     

Energieeffizienznetzwerke – beschleunigte Emissionsminderungen in der mittelständischen Wirtschaft

The reduction of energy-related CO₂ emissions by more efficient enery use in medium sized companies is one of the most profitable options. However, these opportunities are scarcely realised because of many obstacles and market failures. High transaction cost and decision routines play an important role for decision making and procurement of the companies. A network concept being developed in Switzerland and covering an initial consulting of each participating company, targets for the network, regular and moderated meetings of the energy managers for mutual exchange of experiences and a yearly monitoring alleviates many of these obstacles. It doubles the energy efficiency progress relative to the average progress of industry. This network concept can be fully realised by industry itself. Average energy savings per site and year are 100,000 € and average CO₂ emission reduction about 500 t CO₂ per year and site. Assuming a maximum potential of 700 Networks, additional emission reductions of some 10 Mio. t CO₂ seem to be possible in Germany by 2020. A network management system for consulting engineers and moderators allows a minimum performance standard of how to start and operate those efficiency networks.     

Information-seeking behaviour in interactive videotex. Training effects in an experimental investigation

First, we present a conceptual framework designed to measure information-seeking behaviour of non-professional users of Bildschirmtext, the German version of interactive videotex. A training programme is conceived with the aim of improving high school students' information-seeking behaviour in videotex by means of three consumer education lessons. Second, a laboratory investigation is described which set out to measure the influence of user training and the impact of three antecedents (sex, age, and school mark) upon four constructs of information-seeking behaviour, viz., precision of the information goal, user efficiency, content and amount of retrieved information, and satisfaction with the system. We found (a) that the training increased the ability to formulate precise information goals, (b) that the more precise the information goal the less the user efficiency and the less the satisfaction with the system, and (c) that there exist substantial sex-specific differences in information-seeking behaviour.

---

Zusammenfassung Um Bildschirmtext (Btx) wirkungsvoll nutzen zu können, muß der Teilnehmer sein Informationsverhalten den Speicherstrukturen dieses interaktiven Systems anpassen, die vom Suchbaum-Menue-Prinzip geprägt sind. Da das alltägliche Informationsverhalten des durchschnittlichen Verbrauchers nicht derart strengen Regeln folgt, ist fraglich, ob Btx eine erfolgreiche Karriere als Verbraucherinformationssystem beschieden sein wird. Für Zwecke der Untersuchung wird zunächst ein Konzept entwickelt, um das Informationsverhalten nicht-professioneller Nutzer an Btx messen zu können. Weiterhin wird ein Trainingsprogramm entwickelt, das geeignet scheint, Schüler/innen im Rahmen der Verbrauchererziehung in dem wirkungsvollen Gebrauch von Bildschirmtext zu unterweisen. Die Wirkung dieses Programms und der Einfluß dreier Antezedenzvariablen (Alter, Geschlecht und Schulnote) wird im Hinblick auf vier Größen des Informationsverhaltens (Präzision des Informationsziels, Effizienz des Nutzerverhaltens, Art und Inhalt der abgerufenen Informationen und Zufriedenheit mit der Btx-Nutzung) bei Jugendlichen zwischen 13 und 16 Jahren gemessen. Zur Analyse wurde das LISREL Programm eingesetzt, das die kausalen Strukturen zwischen beobachtbaren und latenten Variablen abbildet und überprüft. Es zeigt sich, daß (a) das Nutzertrainung die Präzision des Informationsziels erhöht, daß (b) präzisere Informationsziele die Nutzereffizienz und die Zufriedenheit mit dem System reduzieren, und daß (c) die Bildschirmtextnutzung starke geschlechtsspezifische Unterschiede aufweist. Die Ergebnisse unterstreichen, daß rechnergestützte, interaktive Informationssysteme für den Verbraucher erst dann von Nutzen sein können, wenn das Informationsangebot konsequent seinen Informationsfähigkeiten und -bedürfnissen angepaßt wird.

---

---

Eberhard Kuhlmann is Professor of Consumer Economics and Ingo Balderjahn Assistant Professor of Quantitative Methods in Economics at the Technical University of Berlin. Mailing address: Technische Universität Berlin, Franklinstr. 28/29; D-1000 Berlin 10, FRG.     

Competitive Product Development in the Financial Services Industry—A Knowledge-Based Approach

The development of innovative products and the ability to quickly adapt to changes is important for financial institutions in today's highly competitive environment. The information system department has to create the required information technology support (IT support) for these tasks. A model that allows the characterization of bank products by means of parameter sets and integrity constraints that in most cases may be viewed as business rules will be presented. Based on this parameter model a prototype system was developed to verify the approach used. This system also provides support for the areas of risk and yield management and may be used as a basis for systems providing counselling services. The prototype was implemented by coupling PROLOG and a relational database system. Arguments will be presented against the use of object-oriented database systems and in favour of the currently less popular deductive database approach. The approach presented may be extended such that products related to the life insurance business may also be covered.     

Private information, trading volume, and stock-return variances

New evidence is provided on the determinants of stock-returnvariances. First, when the Tokyo Stock Exchange is open on Saturday,the weekend variance increases; weekly variance is unaffected,however, despite an increase in weekly volume. Second, the listingof U.S. stocks in Tokyo substantially increases the number oftrading hours, but Tokyo volume is negligible for these U.S.stocks and their 24-hour variance is unaffected. The overallresults are consistent with the predictions of private-information-basedrational trading models, but inconsistent with both the irrationaltrading noise and public-information hypotheses.