ADR holdings of US-based emerging market funds

What motivates investors to hold American Depositary Receipts (ADRs) rather than the underlying stock of US listed foreign firms? We analyze the investment allocation decision of actively-managed emerging market mutual fund managers. Although legal provisions are typically assumed to affect ADR and its underlying domestic shares equally, investors holding ADRs may have a higher level of legal protection as these securities are issued and traded in the US. We find that ADRs are the preferred mode of holdings if the local market of the issuer has weak investor protection, low liquidity and high transaction costs.     

Implementation in Economic Environments with Incomplete Information: The Use of Multi-Stage Games

This paper shows that, in economic environments with incomplete information, incentive compatibility and a preference reversal condition are sufficient for implementation in sequential equilibrium.Journal of Economic LiteratureClassification Numbers: C72, D71, D82.     

An Economic Model of Whistle-Blower Policy

"Whistle-blowing" is an increasingly common element of regulatoryenforcement programs and one that is encouraged by recent legislationin the United States and elsewhere. We examine how responsiveregulators should be to whistle-blower tip-offs and how severeshould penalties be for wrongdoers detected in this way. Competingpsychological theories as to what motivates employees to becomewhistle-blowers are operationalized as alternative behavioralheuristics. Optimal policy depends upon the motives attributedto whistle-blowers—which of the theories you subscribeto—but is not in general characterized by maximal penaltiesnor routine pursuit of complaints, even when pursuit is costless.(JEL K42, K32)     

Anti-branding on the internet

Anti-brand web sites are online spaces that focus negative attention on a specific targeted brand. Although anti-consumption movements on the internet have been gaining in numbers and in strength, research has not fully uncovered the nature of such sites and their impact on brand value and consumer anti-consumption. We present a conceptual framework describing online anti-branding and investigate causal relationships in two empirical studies. Study 1 investigates the brand value's impact on likelihood of the presence of anti-brand sites. Strong brands are more likely to have anti-brand sites. Study 2 is a content analysis of a representative sample of anti-brand sites that assesses the nature of the language used by such sites. Anti-brand sites use three types of language — market, ideological and transactional speech. The study finds that market speech is most prevalent and relates to brand value.     

REMOVING THE “VEIL OF IGNORANCE”: NONLINEARITIES IN EDUCATION EFFECTS ON GENDER WAGE INEQUALITIES

A large literature studies the mean gender wage gap in developing countries and finds mixed evidence about the role of education policies in closing gender earnings inequalities. We contribute to this literature by exploring two types of nonlinearities in wage earning regressions: (1) nonlinearities on the effects of education on expected earnings along the distribution of education endowments; and (2) heterogeneities on the contributions of education to the gender wage gap at different quantiles of the wage distribution. Our analyses provide new insights on how these nonlinear effects can be used to set up better targeted gender and development policies. (JEL I26, C14)     

Intrahousehold moral hazard frictions and household poverty traps in rural India

We empirically study the role of assets held by women in the creation of household wealth using data from rural India. We design a streamlined model of intrahousehold project funding where moral hazard frictions between spouses and women's asset control are the main ingredients. As predicted by the model, the data show that household asset accumulation depends on women's asset control in a non-monotonic way. Results indicate no presence of multiple equilibrium poverty traps, but do show that exogenous negative shocks will trigger assets aggregation within households where both spouses are present. This resilience mechanism is, however, not found in female headed household as these households have a monotonic relationship between women's wealth control and asset creation. We thus argue that policies to support women's empowerment need to distinguish women based on their individual wealth levels and headship status to enhance household well-being in remote Indian communities.