Collateralized Social Relations: The Social in Economic Calculation

Traditionally, economists have viewed social relations as "friction" or "impediments" to exchange and have excluded social relations from their analyses by assuming autonomous actors. Recently, however, a number of scholars—economists, sociologists, anthropologists, and other social scientists—have begun to discuss the numerous ways in which social arrangements both prompt and channel economic activity. Rational choice theory, social capital and network analysis, and agency and game theory, are among those approaches that consider the effects of social relations on economic action. In this paper we extend that discussion by arguing that social relations can function as "collateral" or assurance that an economic transaction will proceed as agreed by the parties involved. We review recent microeconomic theories and conjecture how they might be developed following this observation, which is derived from sociological and anthropological studies of economic action and organization.     

Internal monitoring, regulation, and compensation of top executives in banks

This paper examines the relation between incentive pay, monitoring, and regulatory requirements in banks. Using a one-period model with asymmetrical information between the bank owner and the top management team, as well as within the team itself, we show that (1) incentive pay increases the mutual-monitoring activity among top executives; (2) senior executives, especially the CEO, collect more incentive pay than their subordinates; and (3) bank regulations, such as capital adequacy (CAD) requirements, reduce the absolute amount of incentive pay granted to executives.     

Out of the Mouths of Babes: Business Ethics and Youths in Asia

A model of corporate ethics and social responsibility (CESR) was developed and empirically tested among Chinese business undergraduates in Hong Kong and Singapore. As predicted, it was found that CESR beliefs were negatively related to Machiavellianism and two Confucian concepts, guanxi (interpersonal connections) and mianzi (face). CESR beliefs were also lower among Hong Kong than Singaporean youths. The negative effects of guanxi, mianzi, and Machiavellianism were more pronounced for the Hong Kong than Singapore sample. Implications of these findings are discussed and directions for future research suggested.     

基于组织模块化的价值网研究

在企业所处的商业生态系统中，随着价值链的延伸、分解和网络化，企业的内部网络和外部网络联结起来，形成一个开放的价值网，价值的创造、交换和共享分布在整个网络中。在价值网中，逐渐形成了不同职能、不同层次的组织模块，组织模块化构成了价值网的组织基础。本文的实践意义在于为企业在网络经济中的竞争战略提供指导：企业之间的竞争已演变为其所属的价值网的竞争，企业必须致力于构建基于价值网的竞争能力：模块化能力、控制协调能力、关系管理能力。     

Attracting investors for public health programmes with Social Impact Bonds

ABSTRACT

Social impact bonds (SIBs) have emerged as an innovative financing mechanism. This paper explores how health SIBs align with investors’ expectations and the conditions required to attract investors. At present, health SIBs are unlikely to provide sufficient financial returns given their financial risk to attract mainstream investors, so may be better suited to investors who are prepared to accept lower financial returns blended with particular health impact returns.     

On merchant banking

The objective of this article is to lay the groundwork for a theory of merchant banking. One of the most significant business events in the last decade is the restructuring of American corporations. Modern merchant banks evolved in response to the new demand. They step in and provide their own capital (equity, bridge loans, and junk bonds) to resolve the magnified financing problem due to the large relative and absolute amount of debt involved. Merchant banks provide strong certification, minimize the costs of obtaining the bundle of services, and, most important, they transform and extend the transactions horizon.     

A SURVEY OF RECENT DEVELOPMENTS IN THE LITERATURE OF FINANCE AND GROWTH

Abstract.  This paper provides a survey of the recent progress in the literature of financial development and economic growth. The survey highlights that most empirical studies focus on either testing the role of financial development in stimulating economic growth or examining the direction of causality between these two variables. Although the positive role of finance on growth has become a stylized fact, there are some methodological reservations about the results from these empirical studies. Several key issues unresolved in the literature are highlighted. The paper also points to several directions for future research.     

Optimal portfolios when volatility can jump

We consider an asset allocation problem in a continuous-time model with stochastic volatility and jumps in both the asset price and its volatility. First, we derive the optimal portfolio for an investor with constant relative risk aversion. The demand for jump risk includes a hedging component, which is not present in models without volatility jumps. We further show that the introduction of derivative contracts can have substantial economic value. We also analyze the distribution of terminal wealth for an investor who uses the wrong model, either by ignoring volatility jumps or by falsely including such jumps, or who is subject to estimation risk. Whenever a model different from the true one is used, the terminal wealth distribution exhibits fatter tails and (in some cases) significant default risk.     

Behavioural adaptation to climate change among winter alpine tourists: an analysis of tourist motivations and leisure substitutability

Understanding market responses to climate change impacts has important implications for the sustainability of Australia's winter tourism destinations. Utilising a framework incorporating push–pull tourist motivations and the theory of leisure substitutability, this study sought to explore how winter tourists in Australia will adapt to changes in snow cover in Australia's alpine regions under future climate change scenarios. The results of a questionnaire completed by 231 respondents indicated that tourist motivations were related to behavioural adaptation, and that there is a general preference among the current winter market for spatial substitution in the event of poor snow. Those motivated by recreation specialisation or snow-related attributes were likely to opt for spatial substitution, while tourists motivated by self-expression and après ski activities displayed resilience to poor snow conditions. The results demonstrate a clear division between leisure-driven tourists who valued participation in sport, and experience-driven tourists, who displayed higher resilience to reduced snow under projected climate change scenarios. These results have practical implications for winter tourism destinations, both in terms of targeting experience-driven tourists in the case of reduced snow as well as the longer term sustainability and viability of winter tourism destinations.     

A global compass for the great divergence: Emissions versus production centres of gravity 1820–2008

We construct the world's centres of gravity for human population, GDP and CO₂ emissions by taking the best out of five recognised data sources covering the last two centuries. On the basis of a novel distortion‐free representation of these centres of gravity, we find a radical Western shift of GDP and CO₂ emission centres in the nineteenth century, in sharp contrast with the stability of the demographic centre of gravity. Both GDP and emissions trends are reversed in the first half of the twentieth century, after World War I for CO₂ emissions, after World War II for GDP. Since then, both centres are moving eastward at an accelerating speed. These patterns are perfectly consistent with the lead of Western countries starting the industrial revolution, the gradual replacement of coal by oil and gas as alternative sources of energy and the progressive catch‐up of Asian countries in the recent past.