Natural Law and the Roman Catholic Tradition: The Importance of Philosophical Realism

The intellectual tradition of Roman Catholicism considers natural‐law theory as providing the philosophical machinery for articulating concepts central to thinking about moral theory, legal theory, and the social order. The thrust of this essay is to explicate the positions rooted in the writings of Aquinas on natural‐law theory, a theory with which a Georgist might find some stimulating similarities. Conditions necessary for natural‐law moral and legal theory are considered through an analysis of the central metaphysical concepts together with their historical development and contemporary significance.     

Bank Debt versus Bond Debt: Evidence from Secondary Market Prices

This paper uses a new data set of daily secondary market prices of loans to analyze the specialness of banks as monitors. Consistent with a monitoring advantage of loans over bonds, we find the secondary loan market to be informationally more efficient than the secondary bond market prior to a loan default. Specifically, we find that secondary market loan returns Granger cause secondary market bond returns prior to a loan default. In contrast, secondary market bond returns do not Granger cause secondary market loan returns prior to a loan default.     

SUBSIDY TO NUCLEAR POWER THROUGH PRICE-ANDERSON LIABILITY LIMIT: COMMENT

Dubin and Rothwell (1990) use details of insurance premiums to develop a methodology for inferring the value to nuclear operators of the Price-Anderson liability limit from but misinterpret the terms of the insurance contracts for which the premiums are paid. This leads them to overstate the subsidy due to the limit by a factor of between four and ten.     

A Matter of Record: Document Management as Part of Good Corporate Governance, Risk Management and Decision-Making

Good governance, risk management and decision-making are facilitated by a proactive approach to document management which includes keeping necessary records but goes beyond that in order to achieve efficient and effective organisational performance. This paper's focus is on organisational knowledge, which is increasingly facilitated by information technology, and communications to capture effectively the intelligence (broadly defined) and understanding of people within the organisation. Documentation of our knowledge assets is a major exercise in risk management and its associated control environment and essential for individual and collective accountability for performance.     

The strategies and limits of gentlemanly capitalism: the London East India agency houses, provincial commercial interests, and the evolution of British economic policy in South and South East Asia 1800–50

This article explores the development of the London East India agency houses during the first half of the nineteenth century, and their evolving commercial and political relationships with merchants and manufacturers in the British provinces. It outlines the emergence of pressure groups in Britain concerned with influencing British economic policy in India and the Far East, and their role in shaping policy as the East India Company receded in importance following the Charter Acts of 1813 and 1833. What emerges is a complex picture of collaboration between interest groups in London and the provinces. This challenges and refines aspects of the gentlemanly capitalism thesis of Cain and Hopkins, which emphasizes both the supremacy of London-based financial and mercantile interests in the formation of British policy towards the empire, and the separateness of City-based 'gentlemanly capitalists' from provincial mercantile and industrial interests.     

ACCOUNTING CHOICE AND A THEORY OF CRISIS: THE CASES OF POST-PRIVATIZATION BRITISH TELECOM AND BRITISH GAS

In examining the accounting choices of two UK utilities, it is argued that positive accounting theory is devoid of explanatory power. In its place the paper proposes a neo-Marxist theory of crisis management, largely based on the work of Habermas. It analyses the financial statements of British Telecom and British Gas, and shows how their accounting choices may be more satisfactorily explained as responses to avoid crises that otherwise might be faced by these two entities in the general context of crisis tendencies in the UK socio-economic system. © 1997 Published by Elsevier Science LtdEditorial Note. Since preparing this version of the paper, Tony Puxty has died. Prior to his death, the paper had been sent back for relatively minor revisions. Although these were not undertaken, the reviewers and myself think that the paper should be published. We do this hoping that it will serve to remind us of a serious and thoughtful scholar of accounting whose wisdom and contributions are very much missed.     

An Empirical Comparison of Alternative Models of the Short-Term Interest Rate

We estimate and compare a variety of continuous-time models of the short-term riskless rate using the Generalized Method of Moments. We find that the most successful models in capturing the dynamics of the short-term interest rate are those that allow the volatility of interest rate changes to be highly sensitive to the level of the riskless rate. A number of well-known models perform poorly in the comparisons because of their implicit restrictions on term structure volatility. We show that these results have important implications for the use of different term structure models in valuing interest rate contingent claims and in hedging interest rate risk.     

No Job,No Money,No Refi: Frictions to Refinancing in a Recession

We study how employment documentation requirements and out-of-pocket closing costs constrain mortgage refinancing. These frictions, which bind most severely during recessions, may significantly inhibit monetary policy pass-through. To study their effects on refinancing, we exploit a Federal Housing Administration policy change that excluded unemployed borrowers from refinancing and increased others' out-of-pocket costs substantially. These changes dramatically reduced refinancing rates, particularly among the likely unemployed and those facing new out-of-pocket costs. Our results imply that unemployed and liquidity-constrained borrowers have a high latent demand for refinancing. Cyclical variation in these factors may therefore affect both the aggregate and distributional consequences of monetary policy.     

Discussion of “On the allocation of fixed and variable costs from service departments”

The Balachandran, Li and Magee (1987) (BLM) paper develops a positive purpose for cost allocations within the context of pricing the outputs of a central service facility. The line of argument is that, while the short-run price for a service should equal its short-run variable cost, there is a motivational purpose, relating to capacity acquisition, that can be served by allocating the fixed, or joint, costs of a service facility to its users. The authors establish some initial results and then, arguing that the issues considered in this paper relate to the more general problem of incentive compatibility, they compare their results to two extant models that deal with the topic of incentive compatibility.