Tainted museums: ‘selling out’ cultural institutions

• This paper examines the role of museums as repositories of cultural meaning and symbolic capital. As educational and cultural institutions, museums serve to legitimise works of art within the frame of an art historical context. However, our comparative case study reveals how the taken‐for‐granted role of the museum as an allegedly unbiased platform for disseminating the arts can be usurped for economic or political ends. Using the cultural settings of the Hong Kong Museum of Art and the Venezuelan art museum circuit, we examine via our case studies how legitimation in the arts may be jeopardised or misused if and when cultural institutions succumb to commercial and political pressures. By adopting a qualitative research design, we observe the macro‐context in which institutional roles are defined and played out, and demonstrate the ideological discourses at play in the role of these cultural institutions as meaning‐makers. Although they may be presented as neutral spaces, museums inadvertently serve to circulate socio‐political views. How the institution manages these views and unavoidable macro‐level forces will in turn influence the cultural credibility of the museum framework as a legitimising force on the cultural horizon. Attention is devoted to how these pressures can affect the production and consumption of art, offering an alternative perspective on the development of museum policies.

Copyright © 2015 John Wiley & Sons, Ltd.     

Advances in specification testing

Testing the specification of econometric models has come a long way from the t tests and F tests of the classical normal linear model. In this paper, we trace the broad outlines of the development of specification testing, along the way discussing the role of structural versus purely statistical models. Inferential procedures have had to advance in tandem with techniques of estimation, and so we discuss the generalized method of moments, non parametric inference, empirical likelihood and estimating functions. Mention is made of some recent literature, in particular, of weak instruments, non parametric identification and the bootstrap.     

EARLY WITHDRAWALS FROM RETIREMENT ACCOUNTS DURING THE GREAT RECESSION

Early withdrawals from retirement accounts are a double‐edged sword, because withdrawals reduce retirement resources, but they also allow individuals to smooth consumption when they experience demographic and economic shocks. Using tax data, we show that preretirement withdrawals increased between 2004 and 2010, especially after 2007, but early withdrawal rates are substantial (relative to new contributions) in all those years. Early withdrawal events are strongly correlated with shocks to income and marital status, and lower‐income taxpayers are more likely to experience the types of shocks associated with early withdrawals and more likely to have a taxable withdrawal when they experience a given shock. (JEL G23, H24, H31)     

COMPLEMENTARITY IN INPUT–OUTPUT ANALYSIS AND STOCHASTICS

The complementarity between the quantity and value systems of input–output analysis is shown to be the basis of the complementarity problem approach to computable general equilibrium. The numerical superiority of the latter to the linear programming approach facilitates stochastic analysis of input–output scenarios. For the example where Kyoto targets are underachieved to uncertain degrees, confidence intervals are derived for the associated consumption reductions.     

Institutional demand pressure and the cost of corporate loans

Between 2001 and 2007, annual institutional funding in highly leveraged loans went up from $32 billion to $426 billion, accounting for nearly 70% of the jump in total syndicated loan issuance over the same period. Did the inflow of institutional funding in the syndicated loan market lead to mispricing of credit? To understand this relation, we look at the institutional demand pressure defined as the number of days a loan remains in syndication. Using market-level and cross-sectional variation in time-on-the-market, we find that a shorter syndication period is associated with a lower final interest rate. The relation is robust to the use of institutional fund flow as an instrument. Furthermore, we find significant price differences between institutional investors’ tranches and banks’ tranches of the same loans, even though they share the same underlying fundamentals. Increasing demand pressure causes the interest rate on institutional tranches to fall below the interest rate on bank tranches. Overall, a one-standard-deviation reduction in average time-on-the-market decreases the interest rate for institutional loans by over 30 basis points per annum. While this effect is significantly larger for loan tranches bought by collateralized debt obligations (CDOs), it is not fully explained by their role.     

Downside risk of international stock returns

This paper investigates the downside risk exposure of international stock returns in 14 major industrialized economies around the world. For the period 1975–2010, we find that differences in returns on value and growth portfolios can be rationalized by assets’ reagibilities to market’s downside shocks. International value stocks are particularly sensitive to market’s permanent downside shocks, while international growth stocks are particularly sensitive to market’s temporary downside shocks. In line with recent evidence for the US, risk associated with unfavorable changes in market’s cash-flow innovations carries a premium which is pervasive and statistically significant.