Does democracy cause growth? A meta-analysis (of 2000 regressions)

The relationship between democracy and economic growth has been widely debated in the social sciences with contrasting results. We apply a meta-analytical framework surveying 188 studies (2047 models) covering 36 years of research in the field. We also compare the effect of democracy on growth with the effect of human capital on growth in a sub-sample of 111 studies (875 models). Our findings suggest that democracy has a positive and direct effect on economic growth beyond the reach of publication bias, albeit weaker (about one third) of that of human capital. Further, the growth effect of democracy appears to be stronger in more recent papers not surveyed in Doucouliagos and Ulubaşoğlu (2008). Finally, we show that the heterogeneity in the reported results is mainly driven by spatial and temporal differences in the samples, indicating that the democracy and growth nexus is not homogeneous across world regions and decades.     

The True Meaning of ‘Social Justice’: A Catholic View of Hayek

Hayek's well‐known dismissal of the concept of ‘social justice’ is examined and questioned. While basically agreeing with Hayek's critique, the author argues that we should not entirely reject this concept, although it is often used in a vague and emotional way – ‘social justice talk’. Drawing on the tradition of classical liberalism and Catholic social teaching, he makes the case for the true meaning of social justice, which applies to the basic legal and institutional framework of a society rather than the distributional outcomes of market processes.     

基于因子分析法的物流供应商选择模型研究

为了解决在B2C交易实现过程中,由于物流配送供应商的选择不当,而出现配送周期长、费用高、退货退款率增加等问题,本文利用因子分析法探索选择物流配送供应商的合理方法,运用便捷有效的方法帮助电商选择适合自己的物流配送供应商。     

Who should sell stocks?

Never selling stocks is optimal for investors with a long horizon and a realistic range of preference and market parameters, if relative risk aversion, investment opportunities, proportional transaction costs, and dividend yields are constant. Such investors should buy stocks when their portfolio weight is too low and otherwise hold them, letting dividends rebalance to cash over time rather than selling. With capital gains taxes, this policy outperforms both static buy‐and‐hold and dynamic rebalancing strategies that account for transaction costs. Selling stocks becomes optimal if either their target weight is low or intermediate consumption is substantial.     

Educational Development in South Sudan: Conscious Design or Spontaneous Order?

Educational development is key to the future prosperity of South Sudan. Officially the situation appears bleak with up to 50 per cent of primary‐aged children out of school, high reported dropout rates and poor attainment. Those involved in the development of education, government departments, international agencies, individuals and communities are each following one of two different approaches as they seek to extend the reach of education. The article suggests that these different approaches arise because those involved hold to either a conscious‐design or a spontaneous‐order model for educational development. The article looks at the recent development of schools in Juba, the capital of South Sudan, in the light of these two theories and finds, despite the rhetoric of the official reports, that most growth is organic and that most recent educational development is emerging spontaneously.     

Defining Capitalism

This article aims to incorporate the essential features of capitalism in an operational definition that identifies capitalism per se (pure laissez‐faire capitalism), and clearly excludes variations such as welfare capitalism and crony capitalism. By concisely highlighting the fundamental structures and mechanisms of capitalism, this essential definition facilitates defences of it that are more robust than those ordinarily offered. It also clarifies the relation between capitalism and phenomena with which it is frequently associated, and suggests a straightforward way of identifying and measuring the extent of capitalism in mixed economies.     

STOCK‐BOND CO‐MOVEMENTS AND FLIGHT‐TO‐QUALITY IN G7 COUNTRIES: A TIME‐FREQUENCY ANALYSIS

This paper examines co‐movement between stock returns and changes in 10‐year government bond yields as well as flight‐to‐quality behaviour in G7 countries. We conduct the wavelet squared coherence analysis to explore the dynamics in both time and frequency domain. Our results provide evidence of positive co‐movements, which vary over time and across investment horizon. The higher co‐movement is found to be more concentrated in the lower frequency bands. We further analyse the dynamic nature of the scale‐dependent wavelet correlations and find that the correlations are highly volatile and significantly increase across different time scales during the episodes of equity market turbulence. The increase in correlations reflects flights from stocks to safer bond investments as a result of dramatic changes in investor sentiment and risk aversion at times of market stress.     

Foreign direct investment and economic growth: Is more financial development better?

We investigate the extent to which an increase in financial development affects the positive effect of foreign direct investment on economic growth. Although the financial sector is beneficial for economic growth, the effect of further financial development on growth is found to become insignificant. Using a dynamic panel threshold model on 62 middle- and high-income countries spanning the period 1987–2016, we re-examine the possible nonlinearity between finance, foreign direct investment, and growth. Consistent with the “vanishing effect” of financial development, we find significant evidence that foreign direct investment fosters growth in general, but the growth effect of foreign direct investment becomes negligible when the ratio of private sector credit to gross domestic product exceeds 95.6%. This finding is robust to different econometric methods, various subsamples and interaction analyses, and distinct financial development indicators.     

Wilhelm Röpke and Richard C. Koo On Secondary Deflations and Balance Sheet Recessions

The concept of a ‘secondary deflation’ was developed in the 1930s by the German economist Wilhelm Röpke, who saw it as something different from a normal depression. While a primary deflation is a necessary reaction to the inflation from a boom period, a secondary deflation is independent and economically purposeless. Röpke argued that secondary depressions occurred in the US, Germany, France and Switzerland during the 1930s, but was vague on what made them follow primary depressions. Recently, the Taiwanese–American economist Richard C. Koo has claimed to have discovered the ‘Holy Grail of macroeconomics’, that is, what made the Great Depression so deep and long. During the Great Depression, the bursting of the asset price bubble resulted in private sectors having more debt than assets; as they shifted from maximising profits to minimising debt, the consequent debt deflation shrank the economy. According to Koo, Western economies today are suffering from a similar ‘balance sheet recession’. Strengthened by the notion of a balance sheet recession, Röpke's long‐lost insights might advance our understanding of the business cycle in general and the present crisis in the US and the Eurozone in particular.     

A test of the different implications of the overconfidence and disposition hypotheses

Under both the overconfidence and disposition biases, a positive relationship is predicted between prior returns and subsequent trading volume. However, theoretically the overconfidence and disposition effects have different implications on the relationships between the long- and short-position gains of traders and their subsequent buying and selling activities. We examine a unique dataset obtained from the Taiwan Futures Exchange which records all account-level trades and orders. Our data and methodology have the advantage of being able to empirically differentiate these two effects and we demonstrate that different types of traders exhibit different types and levels of behavioral biases.