From Sickness to Health: The Twentieth-Century Development of U.S. Health Insurance

This paper explores the institutional development of health insurance in the United States. By combining a qualitative history of the development of the market with an empirical analysis of a panel of health insurance data from 1931-1955, the paper identifies a number of factors that influenced the growth of the health insurance market. While demand factors such as increasing income and improvements in medical technology certainly contributed to the growth of the market, supply side factors were also important. There is evidence that hospitals may have contributed to the growth of health insurance as a means of smoothing revenues during the Great Depression. State-level policies that allowed the Blue Cross and Blue Shield plans to operate as nonprofits also spurred market growth, as did federal government policies that promoted the link between employment and health insurance.     

Estimation of a simultaneous equations model with an ordinal endogenous variable: The extent of teacher bargaining and the state legal environment

This paper presents a simple two-step estimator for a simultaneous equations model that contains an ordinal endogenous variable. The estimation rules are extensions of the Heckman (1978) estimators, also considered by Amemiya (1978). Asymptotic covariance matrices of the estimators also are derived. The estimator is applied to an economic model in which the statewide extent of teacher bargaining and teacherbargaining legislation are determined jointly.     

From home to hospital: The evolution of childbirth in the United States, 1928-1940

This paper examines the shift in childbirth from home to hospital that occurred in the United States in the early 20th century. Using a panel of city-level data over the period 1928-1940, we examine the impact on maternal mortality resulting from the shift of childbirth from home to hospital. Results suggest that until the late 1930s when sulfa drugs were developed, medical intervention had a limited impact on maternal mortality. Post-sulfa, the medicalization of childbirth reduced maternal mortality. Regressions estimated separately by race provide mixed evidence as to whether blacks and whites benefited differentially from medical intervention.     

Cheating and NASCAR: Who's at the wheel?

This article embarks on a road trip to NASCAR, the National Association for Stock Car Auto Racing, to take a close look at why cheating occurs within that organization. Two arguments drive the article, namely that NASCAR (1) may not be able to stop cheating particularly within the current context, and (2) might not want or be motivated to stop cheating. Obstacles complicating NASCAR's efforts to stop cheating include the long-standing culture of unethical behavior within stock car racing, and the inconsistent imposition of punishments by NASCAR which drivers and race teams perceive as favoritism and unfair treatment. Yellow flags that raise caution include pressure from unwavering fans, and the friction between innovation and maintaining parity among teams. Proposed solutions include changing the culture within the NASCAR community, as well as developing ethical role models, both of which require major action by NASCAR's top managers to signal the importance of ethical behavior. Other key stakeholders such as sponsors and fans must create incentives and rewards for ethical behavior, and consider reducing or ending support for drivers and teams that engage in unethical conduct. Our analysis and recommendations have broad applications because NASCAR is an archetype of a large organization attempting to reduce cheating and unethical behavior.     

A Simple Approach to Better Distinguish Real Earnings Manipulation from Strategy Changes*

Researchers typically infer real earnings management when a firm's operating and investing activities differ from industry norms. A significant problem with classifying deviations from industry averages as myopic earnings management is that companies can change their operating and investing decisions for strategic business reasons rather than to mislead stakeholders. Using principal components analysis, we systematically evaluate existing measures and develop a comprehensive real activities measure to better capture earnings manipulation. Our measure reflects (i) deviations from industry averages across multiple activities and (ii) other signals of manipulation. This approach is promising because, although there are many sources of abnormal activities, manipulation is more likely the cause when managers engage in multiple income-increasing abnormal activities that coincide with other signals that indicate an elevated risk of manipulation. This simple approach results in a metric that associates negatively with future operating performance and earnings persistence, yields high-power tests, and captures manipulation reasonably well across most life-cycle stages. Importantly, this approach performs better than the standard real earnings management metrics across all dimensions. Specifically, it generates the expected reduction in future earnings and reduced earnings persistence in 82% of the tests compared to 36% and 46% in common alternatives. Also, because this innovation does not require a long time-series or rely on future period realizations for classification, it can be useful in more research settings than other recent innovations in the literature.     

“Your Job No Longer Exists!”: From Experiences of Alienation to Expectations of Resilience—A Phenomenological Study

We have entered the age of the contingent or temporary worker, the consultant and the subcontractor. Workers are expected to be pliable and tractable; to “fit in.” Being made redundant is also an area where modern workers are expected to be flexible and resilient. However, when these so-called “flexible” workers are told their job no longer exists, the accompanying sense of rejection and alienation can be excruciating. Stories of being made redundant were collected during an exploratory, qualitative study, using Heideggerian phenomenology as the methodological vehicle to capture the lived experiences of those affected. Focused, in-depth interviews were conducted with the ten respondents; nine men and one woman. The stories shared suggest that being made redundant is an alienating experience with respondents sharing feelings of powerlessness, shock, betrayal, shame and social isolation. Unfortunately, those having experienced redundancy were also not as resilient as is routinely assumed. They did not “bounce back” unchanged, but reported significant negative outcomes including fear for the future, underemployment, family disruptions and an erosion of trust. Recommendations are made orienting organisations towards a more human process of redundancy.