The stabilization role of police spending in a neo-Keynesian economy with credit market imperfections

Motivated by a seemingly persistent “twin-high” phenomenon in Latin America, we present a novel theoretical framework that has linkages between three institutions (education, criminal justice, and credit) to study policy-pertinent research questions with regards to whether police spending has the potential to serve as an unconventional policy tool for macroeconomic management. Based on a stylized parameterization, we find formal and illegal human capital to share common cyclical properties, which can be "decoupled" under a rule-based regime to police spending. This nonetheless comes at a cost of a greater propagation of the credit friction-induced financial accelerator effect.     

Are All Private Benefits of Control Ineffective? Principal–Principal Benefits,External Governance Quality,and Firm Performance

Private benefits of control (PBC) are benefits that controlling shareholders consume, but that are not shared with minority shareholders. Research focusing on the value protection role of corporate governance typically frames PBC as principal–principal (PP) agency costs, and interprets them as a form of minority shareholder expropriation that decreases firm performance. Taking a value creation perspective of corporate governance, however, we propose a more nuanced role for PBC. Specifically, we see them also as PP agency benefits that compensate controlling shareholders for their monitoring and advisory services, which can increase firm performance. Since both PP costs and benefits affect firm performance, we theorize that PBC enhance firm performance at a diminishing rate. Furthermore, we show that the effect of PBC on firm performance is more positive when country‐level external governance mechanisms are strong.     

Corporate crime and the 'Management' of major hazards

This article is concerned with criminal activity in the context of the regulation of occupational safety and health; within this general concern is a more specific focus upon corporate crime, in the context of the management of major hazards. The article begins by, developing the argument that safety violations are indeed crimes, and ought to be treated as such. This leads on to a more general definitional discussion of the nature of corporate crime. The article then addresses the 'production' of

corporate crime in the context of the management of major hazards, This consideration begins by noting the principles of 'effective'—and hy implication lawful—safety management, before going on to discuss briefly the findings of case studies on the management of safety in contexts characterized by the operation of hazardous technologies. It is concluded that the management and organization ofsafep in these contexts might be labelled 'criminogenic'; a conclusion challenging arguments for increased self-regulation in the organization of safety in such contexts. More generally, it reinforces the claim that we need to consider hazardous technologies and their organizational and managerial contexts in terns of the possible production of safety crimes.     

Testing for autoregressive against moving average errors in the linear regression model

This paper presents a new approach to hypotheses testing problems which are non-nested in the classical sense and which concern the covariance matrix of the disturbance vector of the linear regression model. In particular, the application of the approach to testing for AR(1) disturbances against MA(1) disturbances is explored in some detail. Practical difficulties are discussed and selected upper bounds for the test's five percent significance points are tabulated. The small sample power of four versions of the new test are compared empirically and a clear conclusion is made in regard to the best overall test.     

The Investment in Housing As a Forward Market Transaction: Implications for Tenure Choice and Portfolio Selection

A model of tenure choice is presented which treats the benefits and costs of homeownership from a theory of finance perspective. The incremental benefits from homeownership over renting housing services are from two sources: protection against rental price risk (a forward transaction in the housing market) and from a possible capital gain from the eventual sale of a house (substitutes for portfolio investment). The cost of these benefits is higher initial outlay on housing, which reduces the funds available for portfolio investments. The comparative statics of this model is presented. It is shown that rental risk and portfolio risk add to the value of homeownership. Since homeownership is a partial substitute for portfolio investment, it is shown that the lower the covariance between portfolio returns and future home prices the more valuable is homeownership. In the presence of differential borrowing opportunities it is shown that the leverage available to housing significantly increases the value of homeownership.     

Consequences of measurement problems in strategic management research: the case of Amihud and Lev

Strategic management research has been characterized as placing less emphasis on construct measurement than other management subfields. To illustrate the consequences of measurement error, we revisit the debate on the causes of diversification. Our research suggests that the divergent findings between studies on this topic are largely the result of measurement error, and that prior work has underestimated the true effect of size in the relationships between variables. Copyright © 2004 John Wiley & Sons, Ltd.     

The Next Green Paper on Local Government Finance

What is the role of local government? David King claims that countries with strong local government are richer than those without, but argues that it could shed some of its functions to the market.