Explaining the Rate Spread on Corporate Bonds

The purpose of this article is to explain the spread between rates on corporate and government bonds. We show that expected default accounts for a surprisingly small fraction of the premium in corporate rates over treasuries. While state taxes explain a substantial portion of the difference, the remaining portion of the spread is closely related to the factors that we commonly accept as explaining risk premiums for common stocks. Both our time series and cross-sectional tests support the existence of a risk premium on corporate bonds.     

Nationalism,socialism and planning: Influential ideas in the South

The paper discusses the origin of three influential ideas in the South, the reasons why they are found persuasive by Southern elites, and finally whether they are helpful in promoting modernization. It argues that all three ideas are Janus-faced, combining the ‘modern’ aspects of the rationalist Enlightenment with the partly ‘pre-modern’ rural nostalgia of the Romantic movement. But the ideas are dysfunctional in terms of the desired aims of ‘nation-building’ and attaining material progress. Nationalism, far from being an adhesive can become a disintegrative force in pluralistic societies. Planning becomes a means of suppressing the agents of the economic modernization that is desired. The waving of the Enlightenment and socialist banner of equality in suppressing the merchant, financier and entrepreneur is a smokescreen. The suppression reflects more atavistic impulses, which amount to a denial of the irreducible uncertainty that unavoidably attends commercialization, monetization and industrialization.     

Seeking greener pastures: a theoretical and empirical investigation into the changing trend of foreign direct investment flows in response to institutional and strategic factors

A generic theoretical model is proposed that provides a holistic conceptualization of the phenomenon of changing trend of FDI flows. Integrating both institutional and strategic factors, a rationale for such a change is provided, and the circumstances under which future shifts might take place are identified. A collection of criteria and incentives that various host governments and their agencies must provide to attract FDI are outlined. Several propositions that lead to empirically testable hypotheses are developed from this model. Statistical evidence is then provided of a shift in FDI flows, and the change in their determinants, by empirically analyzing investment by US multinational enterprises into Western Europe and Asia over the 20-year period, 1981–2000.     

Free Trade and Laissez Faire: Has the Wheel Come Full Circle?

This paper notes that there is a need to get to a fourth stage in the evolution of the relationship of free trade to laissez faire going beyond the three stages identified in Max Cordon's magisterial book Trade Policy and Economic Welfare. In the first stage free trade was a special case of the argument for laissez faire. In the second stage many arguments for protection arose with various qualifications to the case of free trade and laissez faire. In the third stage the link between free trade and laissez faire was broken and in the theory of domestic distortions it was noted that all arguments for protection except in the case of monopoly power in trade were second best arguments. Moreover, it was possible to devise measures such as taxes and subsidies that reduced the distortion through government intervention. But noting that government intervention itself carries with it problems of rent seeking and directly unproductive activities as well as the taking into the proper role of Government, laissez faire seems the best policy. Hence the need for a fourth stage in the evolution of free trade and laissez faire to link them together again.     

Authenticity and the authentication of heritage: dialogical perceptiveness

ABSTRACT

The dialogue on authenticity continues to evolve across different temporalities and disciplines. This editorial for the special issue summarizes contemporary progress made by scholars of heritage tourism and shares innovative corridors for deep deliberations. A broad spectrum of provocative ideas are touched upon, ranging from host–guest authentication and intangible heritage to knowledge transfer processes, authenticating heritage in fairytale settings, authenticity and anxiety in the smell of death and life, understanding the boundaries of authenticity, nostalgia, sustainability, marketing, destination competitiveness, and examining affective connotations of authenticity. Discursive insights are offered on how different authenticities are legitimized and critically deconstructed and re-constructed again in the authentication process, to underline the existence of power and authority interventions. Inspiring/innovative pathways, for future research, are also recommended.     

Globalisation, history and development: a tale of two centuries

This paper situates globalisation in historical perspectiveto analyse its implications for development. It sketches a pictureof globalisation during the late nineteenth and twentieth centuries.A comparison of these two epochs reveals striking parallels,unexpected similarities and important differences. It showsthat globalisation did not lead to rapid growth and economicconvergence in the world, either then or now. Indeed, growthslowed down, and income levels diverged, while the gap betweenthe industrialised and developing countries widened, in bothepochs. The story of globalisation, it turns out, does not conformto the fairy tale about convergence and development.