The runaway taxpayer

In order to analyze the determinants of tax evasion, the existing literature on individual tax compliance typically takes a ‘prior-to-audit’ point of view. This paper focuses on a ‘post-audit, post-detection’—so far unexplored—framework, by investigating what happens after tax evasion has been discovered and noncompliant taxpayers are asked to pay their debts. We first develop a two-period dynamic model of individual choice, considering an individual that has been already audited and detected as tax evader, who knows that Tax Authorities are looking for her to cash the due amount. We derive the optimal decision of running away in order to avoid paying the bill, and show that the experience of a prior tax notice reduces the probability to behave as a scofflaw. We then exploit information on ‘post-audit, post-detection’ tax compliance provided by an Italian collection agency for the period 2004–2007 to empirically assess the relationship between prior tax notices and unlawful behavior. The evidence from alternative logit model specifications supports our theoretical prediction: successful tax notices are negatively correlated with the probability of running away.     

The evolution of sanctioning institutions: an experimental approach to the social contract

A vast amount of empirical and theoretical research on public good games indicates that the threat of punishment can curb free-riding in human groups engaged in joint enterprises. Since punishment is often costly, however, this raises an issue of second-order free-riding: indeed, the sanctioning system itself is a common good which can be exploited. Most investigations, so far, considered peer punishment: players could impose fines on those who exploited them, at a cost to themselves. Only a minority considered so-called pool punishment. In this scenario, players contribute to a punishment pool before engaging in the joint enterprise, and without knowing who the free-riders will be. Theoretical investigations (Sigmund et al., Nature 466:861–863, 2010) have shown that peer punishment is more efficient, but pool punishment more stable. Social learning, i.e., the preferential imitation of successful strategies, should lead to pool punishment if sanctions are also imposed on second-order free-riders, but to peer punishment if they are not. Here we describe an economic experiment (the Mutual Aid game) which tests this prediction. We find that pool punishment only emerges if second-order free riders are punished, but that peer punishment is more stable than expected. Basically, our experiment shows that social learning can lead to a spontaneously emerging social contract, based on a sanctioning institution to overcome the free rider problem.     

What is the future of cancer care? A technology foresight assessment of experts’ expectations

ABSTRACT

The aim of this paper is to generate qualified information on technologies that are expected to be relevant to cancer care over the next thirty years (2017–2037). Drawing on the concepts of technology foresight, a methodology was developed for future technology research. Future technologies were identified by consulting editorials of journals specializing in oncology. Nine technologies were selected with the potential to impact cancer care in the future. Additionally, a method was developed for consulting a large number of experts from articles indexed in Thomson Reuters Web of Science. In this survey, more than 83,000 cancer specialists were invited to answer a web survey in which they expressed their expectations about the future of cancer care. The questionnaire was answered by 2408 specialists, 56% of whom stated they were highly knowledgeable experts. Our results show that antibody-related therapies, molecular imaging, and tumor delivery systems are the technologies most likely to be used in cancer care in the next thirty years. The main reasons pointed out for the choice of these technologies were improvements in the prognosis of the disease and improved diagnostic reliability. Meanwhile, knowledge and scientific barriers were highlighted as the main obstacles to the development of the technologies deemed to have more limited chances of success.     

Macroeconomic Determinants of Investment under Inflation Targeting: Empirical Evidence from the Brazilian Economy

The use of interest rate as the main tool by which central banks implement inflation targets points to a strong link between private investment decisions and monetary policy. With the objective of contributing to the literature surrounding macroeconomic determinants of investment under inflation targeting, an empirical analysis through Generalized Method of Moments models for the Brazilian case is made. In a general way, the findings underscore the relevance of macroeconomic variables for the determination of investment. In particular, we find that success inflation targeting creates a stable macroeconomic environment that promotes private investment.     

Evaluation of Collaborative Strategies Used in the Management of Natural Parks in Rio de Janeiro

This paper presents the main conclusions of exploratory research aimed at analyzing the management of eight natural parks in the city of Rio de Janeiro. In view of the participative management guidelines proposed by Law 9985 (“NSCU”), the findings revealed that governmental agencies have, indeed, been making an effort to establish more participative management by means of advisory councils. Despite this, the initiatives have still been partially ineffective. The multiple case studies show that different forms of partnership are sustained with varied organizations; however, factors such as bureaucracy, lack of management autonomy, and the inadequate use of managing tools have hampered the expansion of such collaborative strategies.     

The Cognitive-Affective-Conative Model of Destination Image: A Confirmatory Analysis

ABSTRACT

Destination image influences tourist behavior before, during, and after travel, as it is an important instrument which contributes to tourists’ loyalty. Although Gartner (1993 Gartner, W. 1993. “Image formation process”. In Communication and channel systems in tourism marketing, Edited by: Uysal, M. and Fesenmaier, D. 191–215. New York, NY: The Haworth Press.  [Google Scholar]) advocates that the cognitive, affective, and conative dimensions of destination image are hierarchically interrelated, there is no empirical evidence to support the complete model. This study aims to test the hierarchical nature of the relationship between the dimensions of destination image. The results of structural equation modeling confirm Gartner's theoretical model, validating the theory that the influence of the cognitive component on the conative dimension is higher when mediated by the affective component, raising managerial implications.     

The Domestic Sources of Multilateral Trade Negotiations: Explaining Brazil's Negotiating Position in the Doha Round

This article investigates the effects of a transfer between two countries participating in a customs union. This analysis yields very paradoxical results which differ from the conclusions obtained by the traditional literature which has been developed in a two-country framework or in a multilateral world but with universal free trade. The compensation scheme adopted by the authorities of the customs union may create an overall terms of trade deterioration and induce an impoverishment for both member countries. Thus, transfers may not be an adequate instrument to redistribute the gains of economic integration between the members of a free trade association.     

Transparency,Value Creation,and Financial Crises

This article reports the findings of the authors' recent study of the impact of the level of corporate transparency on shareholder value creation during periods of financial crisis. Their sample consists of the companies comprising Spain's IBEX 35 stock index during the ten‐year period 2000–2010. The study uses three different measures of earnings management (EM) as inverse indicators of the quality of disclosure and carries out fixed effects regressions that adjust for firm and industry characteristics, two periods of financial crises, and the passage of time. The main findings of the study are that (1) companies with lower disclosure quality have generated less value for their shareholders over long time periods and that (2) the shareholders of companies that were more aggressive in managing their earnings experienced greater wealth destruction during the two financial crises of the last decade. Given the still unfolding impact of the recent global financial crisis, as reflected in the current debt crisis in Western European countries, the authors' study reinforces the importance of the current debate over the benefits and costs of increasing the regulation of financial markets, especially in the areas of transparency and disclosure requirements.     

Estimating the expropriation of minority shareholders: Results from a new empirical approach

Abstract

A novel methodological approach is proposed to estimate the effect of separation of ownership and control by dominant shareholders on firm value. The approach offers two major innovations. First, it frees the researcher from the necessity of having to make an ad hoc judgment call regarding which firms feature entrenched owners and which don’t. Under this approach, the main shareholder becomes entrenched when the Shapley Value (SV) of his voting rights crosses an unknown threshold that is estimated jointly with the other model parameters. This approach allows one to perform a test on the joint hypotheses that the incentive to expropriate held by the dominant shareholder impacts negatively the market performance of the firm if the main shareholder is entrenched but produces no impact otherwise. Secondly, it generates a market-based estimate of the critical level of power at which the main shareholder becomes entrenched. The method is applied to a sample of European firms and a threshold equal to 0.34 is estimated. Most firms from the UK have a main shareholder with a SV below the estimated threshold; in contrast, about half of the continental firms in the sample feature main shareholders whose power index is above the estimated threshold. A negative relationship is found between the incentive to expropriate and corporate valuation above the threshold, that is both statistically and economically significant; below the threshold, we find no evidence of a relationship.