Endogenous Liquidity in Asset Markets

This paper analyzes a model in which long‐term risky assets are illiquid due to adverse selection. The degree of adverse selection and hence the liquidity of these assets is determined endogenously by the amount of trade for reasons other than private information. I find that higher productivity leads to increased liquidity. Moreover, liquidity magnifies the effects of changes in productivity on investment and volume. High productivity implies that investors initiate larger scale risky projects which increases the riskiness of their incomes. Riskier incomes induce more sales of claims to high‐quality projects, causing liquidity to increase.     

Is there a Pareto solution to the misaligned incentives and competing objectives of water grabbing in the Lao PDR?

‘Water grabbing’ in the Mekong River has been accelerating at a feverish pace. The stakes have never been greater. Talks between international socio‐environment groups, public–private dam partners, and Mekong countries are increasingly fractious and dysfunctional. The departure of the multilateral agencies, such as the World Bank and Asian Development Bank, from large‐scale infrastructure funding has allowed the private sector access to investment opportunities in hydropower, and as a result facilitated the promise of rapid hydropower growth in the Lao PDR. The antagonism of international social and environmental groups towards these dams is due primarily to the transboundary impacts of multiple constructions and modifications to the Mekong. We posit that the dilemma in the negotiations over the Mekong dams in Lao can be best understood from the perspective of misaligned incentives‐objectives. We examine the major stakeholders involved in contractual negotiations and group parties according to their aligned incentives‐objectives. We employ a criteria trade‐off framework to show that if talks take place over two rounds under particular rules, compromises of objectives and trading of incentives are possible. We stipulate that a Pareto‐optimal solution is indeed possible—if a non‐partisan, authoritative agent with retributory powers to design and enforce corrective incentives for all stakeholders takes part in both negotiation rounds.     

Labor market entry and earnings dynamics: Bayesian inference using mixtures‐of‐experts Markov chain clustering

This paper analyzes patterns in the earnings development of young labor market entrants over their life cycle. We identify four distinctly different types of transition patterns between discrete earnings states in a large administrative dataset. Further, we investigate the effects of labor market conditions at the time of entry on the probability of belonging to each transition type. To estimate our statistical model we use a model‐based clustering approach. The statistical challenge in our application comes from the difficulty in extending distance‐based clustering approaches to the problem of identifying groups of similar time series in a panel of discrete‐valued time series. We use Markov chain clustering, which is an approach for clustering discrete‐valued time series obtained by observing a categorical variable with several states. This method is based on finite mixtures of first‐order time‐homogeneous Markov chain models. In order to analyze group membership we present an extension to this approach by formulating a probabilistic model for the latent group indicators within the Bayesian classification rule using a multinomial logit model. Copyright © 2011 John Wiley & Sons, Ltd.     

„Der Kunde ist König“ — Subjektiv empfundene Kundendominanz als Erfolgsfaktor

Luxuri?s gestaltete Einkaufsumwelten liegen im Trend, wie verschiedene Neuer?ffnungen der letzte Jahre zeigen. Gerade in solchen hochwertig gestalteten Gesch?ften und Einkaufszentren ist die von den Konsumenten beim Einkauf verspürte Dominanz, also das Gefühl, „alles im Griff zu haben“, eine wesentliche Voraussetzung dafür, dass Konsumenten ein Gesch?ft oder ein Einkaufszentrum wertsch?tzen, eine vorteilhafte Einstellung insbesondere zu Preisen und Leistungen sowie eine positive Verhaltensabsicht entwickeln Diese Gefühl der Dominanz kann durch die Ladengestaltung und durch die Verk?ufer-K?ufer-Interaktion im Verkaufsgespr?ch positiv beeinfluss werden.     

Hidden consequences of a first-born boy for mothers

Women whose first child is a boy work less than women with first-born girls. After a first-born boy the probability that women have more children increases. Higher fertility is a possible explanation for the lower labor supply of mothers.     

Customer Personal Features as Determinants of the Formation Process of Corporate Social Responsibility Perceptions

The authors of this paper introduce three customer demographic features (age, gender, and educational level) and three psychological traits (support, collectivism, and novelty seeking) as moderators in a classic model to better explain the formation process of corporate social responsibility (CSR) perceptions. The results of the paper can assist CSR and marketing practitioners in better segmenting the market in order to adapt their CSR and communication strategies and make them more effective. The authors test a causal model that allows them to anticipate CSR perceptions based on customer evaluations of (1) the congruence between the company and its CSR strategy, (2) the motivations of the company to implement CSR activities, and (3) the corporate credibility in developing CSR programs. Results suggest that customer psychological features are more effective for marketing segmentation than demographic features because they explain more differences among customers in the formation of CSR perceptions. CSR support and novelty seeking are the most valuable characteristics that can be applied to marketing segmentation.