Political Economy of City Sizes and Formation

There are two paradigms of city formation and size—the competitive model of large-scale land developers operating in national land markets and the self-organization model of agglomeration. This paper examines the effects of local politics, urban classes, and restrictions in national land markets on city size and formation. It starts by introducing local politics into the two paradigms. Then it turns to a growth situation, where land developers initiate new settlements, but existing cities are either self-organized or governed locally. The paper also examines the politics of local no-growth movements and of governance of specially favored mega-cities.     

Contents of Volume 48

Volume Contents

Contents of Volume 46     

Extreme Risk Measures for International REIT Markets

Extreme risks associated with extraordinary market conditions are catastrophic for all investors. The ongoing financial crisis has perfectly exemplified this point. Surprisingly, there are few studies exploring this issue for REITs. This study aims to close the knowledge gap. We conduct a comprehensive study by utilizing all three methodological categories to examine their forecasting performances of VaR and ES for nine major global REIT markets. Our findings indicate that there is no universally adequate method to model extreme risks across global markets. Also, estimating risks for the stock and REIT markets may require different methods. In addition, we compare the risk profiles between the stock and REIT markets, and find that the extreme risks for REITs are generally higher than those of stock markets. The fluctuations of risk levels are well synchronized between the two types of markets. The current crisis has significantly increased the extreme risk exposure for both REIT and stock investors. In all, our results have significant implications for REIT risk management, portfolio selection, and evaluation.     

An Examination of Adverse Selection in the Public Provision of Insurance

Using a unique data set from Florida's residual property insurer, we test for adverse selection in the public provision of homeowners’ insurance in Florida. We find a significant relationship between the losses and deductible choices of insureds in Florida's residual homeowners’ insurance market. This relationship provides strong evidence of the existence of an adverse selection problem in Florida's residual property insurance market. While this relationship is important to Florida regulators (and taxpayers) specifically, a finding of an adverse selection problem in residual markets in general has implications more broadly for government providers of insurance as an adverse selection problem in these settings will impact the public policy debates and decisions involving these markets.     

Untere Einkommensgruppen noch gezielter entlasten

Wirtschaftsdienst - Prices for energy and food are currently rising extraordinarily sharply. Households with low net incomes in particular are being burdened by the price increases, in some cases...     

Income, Money Ethic, Pay Satisfaction, Commitment, and Unethical Behavior: Is the Love of Money the Root of Evil for Hong Kong Employees?

This study examines a model involving income, the love of money, pay satisfaction, organizational commitment, job changes, and unethical behavior among 211 full-time employees in Hong Kong, China. Direct paths suggested that the love of money was related to unethical behavior, but income (money) was not. Indirect paths showed that income was negatively related to the love of money that, in turn, was negatively related to pay satisfaction that, in turn, was negatively associated with unethical behavior. Pay satisfaction was positively related to organizational commitment. Thus, the love of money is the root of evil, but money is not.