On the challenge to competitive authoritarianism and political patronage in Malaysia

In March 2008, Malaysia's political landscape was shaken by election results showing that the Barisan Nasional had won less than two thirds of the parliamentary seats and lost five states to the opposition. A two‐thirds supermajority had been seen as a sacred threshold for the coalition to ensure its continued legitimacy. It is conjectured here that the 2008 election represented a challenge to the competitive authoritarian regime and that this had direct effects on firms with ties to the ruling coalition. The empirical results show that firms with political patronage were indeed adversely affected by the electoral outcome. More specifically, firms with close ties to the Barisan Nasional experienced a significant negative value effect. Firms characterised by political patronage also saw their leverage reduced significantly more than other firms after the 2008 election, suggesting that their access to debt capital had become more restricted. Moreover, this effect was mainly driven by changes in long‐term debt. These results suggest a significant negative impact on connected firms as the political status quo was challenged in Malaysia.     

The World Is Not Enough! Small Open Economies and Regional Dependence

In this paper, we explicitly introduce regional factors into a global dynamic factor model. We combine new open economy factor models (emphasizing global shocks) with the recent findings of regional importance in the business cycle synchronization literature. The analysis is applied to a large panel of domestic data for four small open economies. We find that global and regional shocks explain roughly 30 and 20 percent, respectively, of the business cycle variation in all countries. While global shocks have most impact on trade variables, regional shocks explain a relatively large share of the variation in cost variables.     

The Headmaster Ritual: The Importance of Management for School Outcomes

We estimate the impact of individual principals on school outcomes by using panel data that allow us to track principals over time. We find that individual principals have a substantive impact on school policies, working conditions, and student outcomes. In particular, students who attend a school that has a one standard deviation better principal improve their achievement by between 0.05 and 0.1 standard deviations. Despite rich background information on principals, it is difficult to characterize successful management, suggesting that innate skills are central. We find that the scope for discretion is larger among voucher schools and in areas with school competition.     

Likelihood-based inference for cointegration with nonlinear error-correction

We consider a class of nonlinear vector error correction models where the transfer function (or loadings) of the stationary relationships is nonlinear. This includes in particular the smooth transition models.     

Does best practice HRM only work for intrinsically motivated employees?

The purpose of this study was to explore the relationships between perception of multiple best practice HRM and employee outcomes. Four cross-sectional surveys from different Norwegian service organizations of a total of 838 employees showed that several relationships between perceived empowerment and perceived information sharing and employee outcomes were moderated by intrinsic motivation. Implications for practice and directions for future research are discussed.     

A COMPARISON BETWEEN ACTUAL DISTRIBUTIONS OF ANNUAL AND LIFETIME INCOME: SWEDEN 1951–89

This paper uses register data on tax assessed income from 1951 to 1989 for a representative sample of Swedish men in order to compare the distributions of annual income and "lifetime" income. It is found that the dispersion of lifetime income is around 35 to 40 percent lower than typical cross-sections of annual income. It is income up to around 30 years of age that mainly explains this discrepancy in the magnitude of dispersions. From the age of 30 until 65 years the correlations between annual and lifetime income are quite high and the dispersion of annual income is not very much higher than the dispersion of lifetime income. An analysis of the evolution of income mobility shows that there is a slight tendency to rising mobility over time. This finding implies that the common approach to study the development of income distribution by using only annual income can be misleading.     

Life Insurance Liabilities at Market Value: An Analysis of Insolvency Risk, Bonus Policy, and Regulatory Intervention Rules in a Barrier Option Framework

This article takes a contingent claim approach to the market valuation of equity and liabilities in life insurance companies. A model is presented that explicitly takes into account the following: (i) the holders of life insurance contracts (LICs) have the first claim on the company's assets, whereas equity holders have limited liability; (ii) interest rate guarantees are common elements of LICs; and (iii) LICs according to the so‐called contribution principle are entitled to receive a fair share of any investment surplus. Furthermore, a regulatory mechanism in the form of an intervention rule is built into the model. This mechanism is shown to significantly reduce the insolvency risk of the issued contracts, and it implies that the various claims on the company's assets become more exotic and obtain barrier option properties. Closed valuation formulas are nevertheless derived. Finally, some representative numerical examples illustrate how the model can be used to establish the set of initially fair contracts and to determine the market values of contracts after their inception.     

Factors of electric vehicle adoption: A comparison of conventional and electric car users based on an extended theory of planned behavior

Increasing the share of battery electric vehicles (BEV) in the total car fleet is regarded as a promising way to reduce local car emissions. Based on online surveys in Denmark and Sweden, this study compares BEV users' (n = 673) and conventional vehicle (CV) users' (n = 1794) socio-demographic profiles, attitudinal profiles, and mobility patterns. In line with previous research, BEV users are typically male, highly educated, have high incomes, and often more than one car in their household. Additionally, BEV users perceive less functional barriers toward BEV use and have more positive attitudes and norms than CV users. The different profiles of these user groups suggest a separate analysis of potential factors of BEV adoption in both groups. In regression analyses, CV and BEV users' intention to use/purchase a BEV is modeled based on factors of the Theory of Planned Behavior extended by personal norm, perceived mobility necessities, and BEV experience. For CV users, symbolic attitudes related to BEVs are the most important factor of intention, while perceived functional barriers in terms of driving range are most relevant for BEV users' intention. How BEV users cope with trips of longer distance seems of particular relevance. In multiple car households, we found the percentage of actual BEV usage related to the type of other cars in the household, perceived functional barriers of BEVs as well as (successful) behavioral adaption to longer trips by BEVs. Based on the results, we discuss ways to increase BEV adoption for current users and non-users.     

Generalized extreme value discrete choice demand models : Existence and uniqueness of market equilibria

Generalized extreme value (GEV) random utility choice models have been suggested as a development of the multinomial logit models that allows the random components of various alternatives to be statistically dependent. This paper establishes the existence of and provides necessary and sufficient uniqueness conditions for the solutions to a set of equations that may be interpreted as an equilibrium of an economy, the demand side of which is described by a multiple-segment GEV random choice model. The same equations may alternatively be interpreted in a maximum likelihood estimation context. The method employed is based on optimization theory and may provide a useful computational approach. The uniqueness results suggest a way to introduce segregation/integration effects into logit type choice models. Generalization to non-GEV models are touched upon.     

A Socio-Dynamic Understanding of Markets

A bstract    Economic sociology furthers a healthy alternative to price-theory–oriented economics as it sets out to remedy the invisibility of the market within the latter. There is, however, no doubt that such a market-oriented sociology is still in its infancy, given among other issues its inability to shoulder market change. The void thus recognized opens up the potential for a market idea with both social and dynamic properties. There is good reason to believe that such an endeavor would benefit from the constructive blending of economic sociology and Austrian economics. This paper argues that such a "socio-Austrian" connection is in the position to enrich the socioeconomic discourse in general and its market conception in particular.