Diversification Benefits of iShares and Closed-End Country Funds

We study the performance and diversification of iShares and their rival closed‐end country funds from April 1996 to December 1999. International iShares are country‐specific series of securities that track the price and yield of a specific Morgan Stanley Capital Internation (MSCI) country index and, presumably, should provide diversification benefits. Our single‐index model demonstrates that iShares replicate the home index, showing some potential for diversification. However, our two‐factor model, which isolates the “true” diversification virtues, documents that both iShares and closed‐end country fund market prices maintain considerable exposure to the U.S. market. Furthermore, the net asset value returns of the closed‐end funds demonstrate a strong home country exposure, suggesting there is no substitute for direct foreign investment.     

Resolving International Conflict: What Role for Business?

This second 1996 Stockton Lecture focuses on poverty as a cause of international conflict - and on what businesses can do or avoid doing to reduce it. Poverty, Roddick argues, fuels revolution. And while the western armaments industry is especially to blame, big institutions like the World Bank and the multinationals have all contributed to causing conflict. Her answers to the problem include more "microenterprise" and fair trading initiatives by multinationals in local communities in the developing world. Her central message is that business "must not only avoid hideous evil; it must actively do good".     

Injury mortality in local communities in Sweden and in the three Baltic States: implications for prevention

This study provides a comparative time-trend evaluation of injury mortality in local communities in Sweden and the three Baltic States, considering their national socio-political and economic situations and with analysis of local injury prevention structures and activities. Data for the period from 1990 to 2002 were gathered from national statistical offices for the cities of Bor?s, Tartu, Jelgava and Kaunas and from WHO databases for national level analyses. The death rates for Bor?s remained relatively stable over the time period, while the Baltic communities had increasing rates until 1994 and seemed to stabilize after 1997. The differences in injury mortality in the studied communities were highest for the 0 - 19 year age group and especially in the 20 - 64 year age group, but not for the 65+ year age group. Local communities in the Baltic States should consider coordinated safety promotion and injury prevention programmes as a complement to national safety promotion framework.     

A longitudinal study of concern and judged risk: the case of Ebola in the United States, 2014–2015

The goal of the present study was to investigate whether playing a serious game concerning natural and man-made risks leads to increased risk awareness and additional information search. As an experimental task, we developed a serious board game. Fifty-six students participated in the experiment; half of them played the serious game whereas the other half only filled in a questionnaire at pretest and posttest (after two weeks). Participants who had played the game were more aware of risks in their own environment. Furthermore, playing the serious game counterbalanced the decline in self-efficacy as seen in the control condition. In both conditions, participants gathered more information on natural risks. This positive effect in the control condition is probably a side effect of the method used: a reasonably elaborate questionnaire in combination with a delay of two weeks. In all, the results provide a positive basis for further development of the game and to use it on a larger scale to empower citizens to take more responsibility for their own safety.     

Bargaining, search, and outside options

This paper studies a two-sided incomplete information bargaining model between a seller and a buyer. The buyer has an outside option, which is modeled as a sequential search process during which he can choose to return to bargaining at any time. Two cases are considered: In Regime I, both agents have symmetric information about the search parameters. We find that, in contrast to bargaining with complete information, the option to return to bargaining is not redundant in equilibrium. However, the no-delay result still holds. In Regime II, where agents have asymmetric information about the outside option, delay is possible. The solution characterizes the parameters for renegotiation and those for search with no return to the bargaining table.     

Equity with Warrants in Private Placements

We examine private equity with warrant (unit) placements and compare them with private equity placements. Firms making unit placements are smaller, younger, riskier, and characterized by higher information asymmetry than equity‐placing firms. Furthermore, unit‐placing firms experience good pre‐placement stock performance; however, their post‐placement performance is poor and worse than that of equity‐placing firms. We also find that very few of the placed warrants are in the money at expiration. Our results are consistent with the window of opportunity hypothesis and the theory that warrants are especially desirable to a clientele of overoptimistic investors.