Bureaucratic Decision Costs and Endogenous Agency Expertise

This article analyzes the effect of the cost that an agencymust incur to adopt a new regulation (the "enactment cost")on the agency's incentive to invest in expertise. The effectof the enactment cost on agency expertise depends on whetherthe agency would regulate if it fails to acquire additionalinformation about the regulation's effects. If an uninformedagency would regulate, increasing enactment costs increasesagency expertise; if an uninformed agency would retain the statusquo, increasing enactment costs decreases agency expertise.These results may influence the behavior of an uninformed overseer,such as a court or legislature, that can manipulate the agency'senactment costs. Such an overseer must balance its interestin influencing agency policy preferences against its interestin increasing agency expertise. The article discusses the implicationsof these results for various topics in institutional design,including judicial and executive review of agency regulations,structure-and-process theories of congressional oversight, nationalsecurity, criminal procedure, and constitutional law.     

Managerial,organizational, and external drivers of sales effectiveness in export market ventures

The authors extend sales management theory by considering the role of export sales management in small- and medium-sized firms, and they develop an integrated model of export sales organization effectiveness. Specifically, the authors test 16 hypotheses that examine the relationships among export sales management control, export territory, psychic distance, export sales performance, and export sales organization effectiveness. Using a mail-survey approach, data were collected from U.K.-based export sales managers in 146 direct exporters of industrial products. Though certain anomalies are observed, the research findings support many of the hypothesized associations, confirming the robustness of existing sales management concepts and theories in an export-marketing context.

Intentions to Report Questionable Acts: An Examination of the Influence of Anonymous Reporting Channel,Internal Audit Quality,and Setting

The Sarbanes–Oxley Act of 2002 requires audit committees of public companies’ boards of directors to install an anonymous reporting channel to assist in deterring and detecting accounting fraud and control weaknesses. While it is generally accepted that the availability of such a reporting channel may reduce the reporting cost of the observer of a questionable act, there is concern that the addition of such a channel may decrease the overall effectiveness compared to a system employing only non-anonymous reporting options. The rationale underlying this concern involves the would-be reporter’s likelihood of reporting, the seriousness with which the organization treats an anonymous report, and the organization’s ability to thoroughly follow-up the report. Thus, we explore the extent to which the availability of an anonymous reporting channel influences intended use of non-anonymous reporting channels. Further, in response to Sarbanes–Oxley and the environment of financial scandals that led to its passage, many firms are strengthening their internal audit departments, and providing them with greater independence from upper management’s direct control. Accordingly, our examination tests whether the intended use of the internal audit department as an internal reporting channel is greater when the internal audit department is of “high” versus “low” quality. Finally, the study investigates intended reporting behavior across three different cases (e.g., settings). Results show that the existence of an anonymous channel does reduce the likelihood of reporting to non-anonymous channels, that generally the internal audit department quality does not affect reporting to non-anonymous channels, and that case-setting affects the type of channel to be used. Implications from the study are discussed.     

Keeping Public Institutions Invested in Tobacco

Increasingly through the 1990s, tobacco control advocates questioned the practice of public institutions investing in tobacco company stocks. The questioning was framed in at least three ways. First, is it ethical to fund public expenditures with profits from a product that causes addiction and disease? Second, is it sound social policy to derive public income from a product that increases healthcare costs and reduces worker productivity? Finally, is it sound fiscal policy to invest in an historically profitable industry facing multiplying legal and regulatory challenges? While the tobacco industry preferred to restrict discussion to the fiscal question, and offered an affirmative answer, its position was weakened by depressed stock prices brought on by actions of the industry as much as by tobacco control activism. As part of a campaign to restore its credibility as an investment vehicle with public fund managers, Philip Morris (PM) commissioned a report from the influential investment managers/advisors Wilshire Associates. However, Wilshire had only recently conducted such a study for the Washington State Investment Board (WSIB), assuring the board that the value tobacco stocks added to an investment portfolio – if any – was too small to be measured. Nonetheless, within a year, Wilshire produced a report for PM which appeared to laud the investment value of tobacco and to dismiss tobacco-excluded investment alternatives. This paper examines how Wilshire produced apparently diametrically opposed reports for clients with different interests. It reveals a pattern of potential conflicts of interest among tobacco companies, financial analysis firms, investment authorities, and institutional fund managers. It demonstrates substantial violations of two generally accepted ethical principles of business consulting: veracity and transparency.     

Long-term mortality following injury in working-age adults: a systematic review

Priorities for prevention activities and planning for services depend on comprehensive knowledge of the distribution of the injury-related burden in the community. The aim of this systematic review was to quantify the effect of being injured, compared with not being injured, on long-term mortality in working age adults. Cohort studies were selected that were population-based, measured mortality post-discharge from inpatient treatment, included a non-injured comparison group and related to working-age adults. Data synthesis was in tabular and text form with a meta-analysis not being possible because of the heterogeneity between studies. Eleven studies met the inclusion criteria. All studies found an overall positive association between injury and increased mortality. While the greatest excess mortality was evident during the initial period post-injury, increased mortality was shown in some studies to persist for up to 40 years after injury. Due to the limited number of injury types studied and heterogeneity between studies, there is insufficient published evidence on which to calculate population estimates of long-term mortality, where injury is a component cause. The review does suggest there is considerable excess mortality following injury that is not accounted for in current methods of quantifying injury burden, and is not used to assess quality and effectiveness of trauma care.     

The Log of Gravity at 15

Portuguese Economic Journal - We review the contribution of “The Log of Gravity” (Santos Silva and Tenreyro, Rev Econ Stat 88:641–658, 2006), summarize the main results in the...     

COMPETITION OR COOPERATION IN URBAN SERVICE DELIVERY?

ABSTRACT: Inter‐municipal cooperation is now as common among US local governments as for profit privatization. This article uses data from a national survey in 2007 to explore the benefits of cooperation – economies of scale, service coordination across the metropolitan region and greater community control. While privatization reforms have focused on harnessing the benefits of a competitive market, cooperation may be the new frontier where economies of scale and efficiency gains can be achieved with governments working together in a new form of collaborative service delivery.