A choice modelling case study on climate change involving two-way interactions

Choice Modelling applications can be designed to estimate main effects only or multiple-way interactions between attributes. It has been reported that higher order effects generally account for less than 10% of the choice explanation. Nevertheless, the amount of applications testing for interactions among attributes in environmental valuation is very limited. This paper reports a Choice Modelling exercise valuing climate change impacts on plant cover, land erosion and fire risk in Spanish shrublands. Two out of three two-way interactions were found significant and to account for more than 20% of the choice model explanation. Their contribution to the log-likelihood value was comparable to the one of the main effects variables. Moreover, accounting for second order interactions significantly altered the estimates of the implicit prices of attributes compared to the main effects specifications.     

Self‐Financing Trading Strategies for Sliding, Rolling‐Horizon, and Consol Bonds

The time evolution of a sliding bond is studied in discrete‐ and continuous‐time setups. By definition, a sliding bond represents the price process of a discount bond with a fixed time to maturity. Examples of measure‐valued trading strategies (introduced by Bjork et al. 1997a, 1997b) which are based on the price process of a sliding bond are discussed. In particular, a self‐financing strategy that involves holding at any time one unit of a sliding bond is examined (the wealth process of this strategy is referred to as the rolling‐horizon bond). In contrast to the sliding bond, which does not represent a tradable security, the rolling‐horizon bond (or the rolling‐consol bond) may play the role of a fixed‐income security with infinite lifespan in portfolio management problems.     

Business or Basic Needs? The Impact of Loan Purpose on Social Crowdfunding Platforms

Journal of Business Ethics - Crowdfunding has created new opportunities for poor microentrepreneurs. One crucial question is the impact that the purpose of a loan—either business investment...     

Green Microfinance in Europe

As global warming continues to attract growing levels of attention, various stakeholders (states, general public, investors, and lobbyists) have put climate change on corporate agendas and expect firms to disclose relevant greenhouse gas (GHG) information. In this paper, we investigate the consistency of the GHG information voluntarily disclosed by French listed firms through two different communication channels: corporate reports (CR) and the Carbon Disclosure Project (CDP). More precisely, we contrast the amounts of GHG emissions reported and the methodological explanations provided (named ‘traceability’) in each channel. Consistent with a stakeholder theory perspective, we find that GHG amounts are significantly lower in the CR than in the CDP. We also find that firms increase the CR figures’ traceability when there is a discrepancy between disclosures in the two channels. We suggest that the aim of this greater traceability is to enhance information credibility across the different channels used.     

Fair bilateral pricing under funding costs and exogenous collateralization

Bielecki and Rutkowski introduced and studied a generic nonlinear market model, which includes several risky assets, multiple funding accounts, and margin accounts. In this paper, we examine the pricing and hedging of contract from the perspective of both the hedger and the counterparty with arbitrary initial endowments. We derive inequalities for unilateral prices and we study the range of fair bilateral prices. We also examine the positive homogeneity and monotonicity of unilateral prices with respect to the initial endowments. Our study hinges on results from Nie and Rutkowski for backward stochastic differential equations (BSDEs) driven by continuous martingales, but we also derive the pricing partial differential equations (PDEs) for path‐independent contingent claims of a European style in a Markovian framework.     

Estimating the revenue costs of tax treaties in developing countries

(12764) Petr Janský Marek Šedivý Tax treaties between countries influence how much tax revenues governments receive from multinational enterprises. These treaties often reduce the withholding tax rates on outgoing dividend and interest payments. We provide illustrative estimates of costs for these two taxes for 14 developing countries in sub‐Saharan Africa and Asia in a first multi‐country comparison of this kind. These might be overestimates because we assume that foreign direct investments are not influenced by the tax treaties. We estimate that the highest potential tax revenue losses are within hundreds of millions US$ and around 0.1% of GDP, with Philippines incurring the highest losses both in US$ and relative to GDP. We also find that around 95% of the losses is due to dividends and that only four investor countries—Japan, Netherlands, Switzerland and Singapore—are together responsible for more than half of the losses. We discuss the limitations of these estimates and how future research could improve their quality as well as coverage.     

Outsourcing and Innovative Activity of the Companies From the Visegrad Group

Outsourcing is a change from horizontal cooperation （coopetition） to a vertical one. That is, the company, which up to now could be considered as a competitor, changes into a supplier. It is worth remembering that the company that is to become a supplier can either create a new one or be an already existing one. This article is based on empirical data coming from the companies from the Visegrad Group that is Poland, the Czech Republic, Slovakia, and Hungary. The results presented here imply that outsourcing has a stimulating effect on innovative activity of a company both in terms of investment and implementation aspects. Also, innovative activity, in its investment and implementation aspects, positively influences the occurrence of outsourcing. This confirms the existence of feedback among these variables. It is worth noting however, that the probability of innovative activity among the companies using outsourcing is higher than the probability of outsourcing among the companies that are irmovatively active. It seems that the influence of outsourcing on innovative activity is stronger than the influence o f innovative activity on outsourcing.     

The Market Model of Interest Rate Dynamics

A class of term structure models with volatility of lognormal type is analyzed in the general HJM framework. The corresponding market forward rates do not explode, and are positive and mean reverting. Pricing of caps and floors is consistent with the Black formulas used in the market. Swaptions are priced with closed formulas that reduce (with an extra assumption) to exactly the Black swaption formulas when yield and volatility are flat. A two–factor version of the model is calibrated to the U.K. market price of caps and swaptions and to the historically estimated correlation between the forward rates.     

The social contract of work: Moving beyond the psychological contract

This paper develops the critique of psychologisation by going narrow and deep into the analysis of the concept of the psychological contract. In its early incarnation, the psychological contract literature explored key elements at the heart of the employment relationship. However, in the current mainstream psychological contract literature, there are four key problems. The paper shows that these problems match on to the wider problems associated with pyschologisation. The concept of the social contract of work is put forward as a way to return productively to the original focus of the field. The social contract of work is defined as workers' implicit, collective, and socially embedded understanding of the effort bargain at work.