?Wir sind besser als die anderen??

The paper applies social psychology??s results on the theory of social comparison to media content. The finding that people tend to evaluate themselves better than they evaluate others, even if there is no foundation for that in reality, presents the starting point of these considerations. Such an optimistic bias can also be observed in social groups. It is established and distributed in small groups by interpersonal communication and contributes to the individuals?? identification with the group and, thus, to the group??s stability. The paper argues that this phenomenon should be applicable to larger social groups such as religious and ethnic groups or social strata. In these cases, the optimistic bias would have to be communicatively distributed through the media. We introduce a theoretical model that combines the role of media content, its individual reception and processing, and the reciprocal effect of processing on social structure. Subsequently, first empirical evidence of optimistic-bias presentations in media discourses is presented, and resulting problems for future research are discussed.     

Specific taxation,asymmetric costs,and endogenous quality

This paper shows how a specific tax—in contrast to an ad valorem tax—alters industry structure and firm-level performance in a monopolistic competition framework, where firms chose product quality endogenously and differ exogenously in productivity (i.e., marginal production efficiency). Industry equilibrium mechanisms and selection based on productivity play a significant role: A specific tax shifts market shares and profits toward firms with costs and prices above the industry average at the expense of low-cost firms. This reallocation of market shares releases a novel scale effect such that low-cost firms may quality downgrade, while high-cost firms always quality upgrade. There exists a parameter subspace, where this combines to a decrease on average quality for the industry. In comparison: An ad valorem tax only reduces the number of firms/varieties in the industry due to demand absorption, but affects neither firm-level performance nor industry structure.     

Like it or not? How the economic and institutional environment shapes individual attitudes towards multinational enterprises

This paper analyses the determinants of people's attitudes towards foreign direct investment (FDI) using a survey‐based data set that covers a wide range of rich and poor countries. We find that both individual socioeconomic characteristics and macroeconomic and institutional factors shape agents’ attitudes towards multinational firms. Moreover, we find that the influence of an individual's characteristics—such as education and the status as an entrepreneur—on her/his perspective on multinationals depends on the respective country's per‐capita income. Our results confirm the conjecture that relative individual attitudes towards multinationals reflect distributional interests as suggested by economic theory.     

Wege zu einer st?rkeren Trennung von Investment- und Gesch?ftsbanking

In the United Kingdom, the United States, Australia and many other countries, ways to separate retail from investment banking are explored and put into practice. In Germany, there is great reluctance to undertake such steps. The main arguments against such a separation are the structure of the German banking sector, the universal banking system, and the claim that Lehman was (only) an investment bank, and its breakdown has triggered the subprime crises. These arguments, the authors show, are not convincing. The paper first discusses different views on a stronger separation of retail from investment banking and subsequently presents and analyses different proposals. Finally, the paper elaborates on the question of how to implement such a system in Germany.     

Expected versus Ex Post Profitability in the Cross‐Section of Industry Returns

Asset pricing theory predicts a positive cross‐sectional relation between expected profitability and expected returns. However, empirical studies typically use lagged ex post profitability as a proxy for expected profitability. In this article, we use out‐of‐sample combination forecasts to estimate expected industry‐level operating profit, gross profit, operating cash flow, and net income. We then construct real‐time industry‐rotation strategies based on high and low expected profitability. For each measure except gross profit, these predicted‐profitability strategies earn significant alpha net of transaction costs and outperform strategies based on ex post profitability.     

Religiosity and household income in Sekhukhune

Literature analysing the interrelation of religion and economic performance suggests religion to explain differences in household income. Religious communities foster economically conducive attitudes and are important sources of social capital, particularly under weak economic structures. This paper targets at investigating effects of religiosity on rural household income using survey data from Greater Sekhukhune in the Limpopo Province of South Africa. Using insights from religious studies within a conceptual framework of rural household decision-making, the authors estimate an income equation that includes measures for religious affiliation. While church membership per se does not reveal a significant effect on household income, the results show a positive and robust relationship for membership in the Zion Christian Church and the practice of African traditional religion.     

ON THE GAME‐THEORETIC FOUNDATIONS OF COMPETITIVE SEARCH EQUILIBRIUM*

We provide a unified directed search framework with general production and matching specifications that encompass most of the existing literature. We prove the existence of subgame perfect Nash equilibria in pure firm strategies in a finite version of the model. We use this result to derive a more complete characterization of the equilibrium set for the finite economy and to extend convergence results as the economy becomes large to general production and matching specifications. The latter extends the microfoundations for the standard market utility assumption used in competitive search models with a continuum of agents to new environments.     

Financial integration,specialization, and systemic risk

This paper studies the implications of cross-border financial integration for financial stability when banks' loan portfolios adjust endogenously. Banks can be subject to sectoral and aggregate domestic shocks. After integration they can share these risks in a complete interbank market. When banks have a comparative advantage in providing credit to certain industries, financial integration may induce banks to specialize in lending. An enhanced concentration in lending does not necessarily increase risk, because a well-functioning interbank market allows to achieve the necessary diversification. This greater need for risk sharing, though, increases the risk of cross-border contagion and the likelihood of widespread banking crises. However, even though integration increases the risk of contagion it improves welfare if it permits banks to realize specialization benefits.