Optimal reinsurance arrangements in the presence of two reinsurers

In this paper, we investigate the optimal form of reinsurance from the perspective of an insurer when he decides to cede part of the loss to two reinsurers, where the first reinsurer calculates the premium by expected value principle while the premium principle adopted by the second reinsurer satisfies three axioms: distribution invariance, risk loading, and preserving stop-loss order. In order to exclude the moral hazard, a typical reinsurance treaty assumes that both the insurer and reinsurers are obligated to pay more for the larger loss. Under the criterion of minimizing value at risk (VaR) or conditional value at risk (CVaR) of the insurer's total risk exposure, we show that an optimal reinsurance policy is to cede two adjacent layers, where the upper layer is distributed to the first reinsurer. To further illustrate the applicability of our results, we derive explicitly the optimal layer reinsurance by assuming a generalized Wang's premium principle to the second reinsurer.     

Lumpy Investment and Corporate Tax Policy

In the presence of both convex and nonconvex capital adjustment costs in a dynamic general equilibrium model, corporate tax policy generates both intensive and extensive margin effects via the channel of marginal Q. Its impact is determined largely by the strength of the extensive margin effect, which, in turn, depends on the cross‐sectional distribution of firms. Depending on the initial distribution of firms, the economy displays asymmetric responses to tax changes. Moreover, an anticipated increase in the future investment tax credit reduces investment and adjustment rate initially.     

Is China’s Manufacturing Industry Efficient? Evidence from an Energy-Rebound Effect Perspective

Majority of the increase in global energy consumption is from China; hence, studying energy issues, especially in China’s manufacturing industry (CMI), is worthwhile and of much interest in the academic field. Based on the translog cost function, we develop a research framework to study the rebound effect of CMI. Considering the effect of asymmetric energy price, we augment the energy-cost function with asymmetric influence constraint of energy price. Again, we add time series data of CMI’s capital, labor, energy, and mid-input to the model to calculate the direct rebound effect of CMI. We find that the rebound effect of CMI is 44.2%, and CMI still has large energy-conservation potentials. Based on the results of this study, some policy recommendations are provided.     

The Impact of Institutions and Exchange Rate Volatility on China’s Outward FDI

Over the past decade, China’s outward foreign direct investment (OFDI) has rapidly increased. However, its characteristics are not sufficiently studied. In this article, we explore the host country’s determinants of China’s OFDI, with a focus on institutional quality, exchange rate volatility, and natural resources by performing an econometric analysis for the period 2003–2013 for a sample of 49 countries. Our results reveal that China’s OFDI is invested in countries with relatively poor institutional quality and abundant natural resources. Exchange rate variability has a dampening effect on China’s OFDI and that the appreciation of the Chinese renminbi enhances OFDI flows.     

Women’s empowerment boosts the gains in dietary diversity from agricultural technology adoption in rural Kenya

Using new survey data from rural Kenya, this paper assesses the moderating effect of women’s empowerment on the relationship between agricultural technology adoption and women’s dietary diversity. We use a multiple treatment endogenous switching regression framework to control for potential endogeneity of women’s empowerment and technology adoption. We find that women’s empowerment has a positive and significant effect on the women’s dietary diversity score regardless of technology adoption status. We further show that women’s empowerment enhances the positive effects of technology adoption on women’s dietary diversity. Although technology adoption has a positive impact on women’s dietary diversity regardless of empowerment status, its effect is stronger for households with empowered vs. disempowered women. Study results suggest that individual and household welfare could be enhanced to a greater degree through interventions that promote women’s empowerment and technology adoption simultaneously rather than separately.     

On dividends in the phase–type dual risk model

The dual risk model assumes that the surplus of a company decreases at a constant rate over time, and grows by means of upward jumps which occur at random times with random sizes. In the present work, we study the dual risk renewal model when the waiting times are phase-type distributed. Using the roots of the fundamental and the generalized Lundberg’s equations, we get expressions for the ruin probability and the Laplace transform of the time of ruin for an arbitrary single gain distribution. Then, we address the calculation of expected discounted future dividends particularly when the individual common gains follow a phase-type distribution. We further show that the optimal dividend barrier does not depend on the initial reserve. As far as the roots of the Lundberg equations and the time of ruin are concerned, we address the existing formulae in the corresponding Sparre-Andersen insurance risk model for the first hitting time, and we generalize them to cover also the situations where we have multiple roots. We do that working a new approach and technique, approach we also use for working the dividends, unlike others, it can be also applied for every situation.     

Headline Impression Management in the Earnings Press Releases of TSX Venture Exchange Firms*

This paper explores firms traded on the Toronto Stock Exchange (TSX) Venture Exchange and their voluntary disclosure practices by focusing on earnings press releases (EPRs). We compare the characteristics of EPR issuers and non-issuers and investigate how the former group uses headline impression management in their EPRs to highlight firm performance. More precisely, we examine emphasis and tone management techniques in the headlines of over 1,300 EPRs by TSX Venture Exchange (TSX-V) firms. Our results show that the main determinants of the EPR disclosure choice are the achievement of positive revenue, an increasing trend in firm market value, and industry type. We find that EPR issuers reinforce and repeat positive results in the headlines of EPRs and use positive tone management to highlight positive financial performance. Our results confirm the association between firm performance and strategic placement of performance results, while illustrating that the strength of this association varies by industry and by EPR characteristics such as EPR length and numerical intensity. Overall, this paper sheds light on TSX-V firms, their disclosure practices, and potential violations of recommendations from regulators regarding avoiding exaggerated or promotional language in press releases.     

The impact of energy-exporting countries’ EPUs on China’s energy futures investors: Risk preference,investment position and investment horizon

This study brings some new insights into EPU risk management. By categorizing China’s energy futures (CEF) investors by risk preference, investment position and investment horizon, we identify how EPU in four energy-exporting countries affects CEF investors. The Russian EPU mainly produces influence on short-run investors and risk-seeking investors. The Australian EPU affects risk-seeking investors heavily, while the Brazilian EPU acts on risk-seeking investors with short positions. In terms of China’s coking coal futures, changes in Russian EPU generate the weakest impact on various types of investors, while the US EPU affects medium-run risk-averse and long-run investors. The Australian EPU’s impact on investor types covers a wide range, while the Brazilian EPU affects short-run risk-averse and long-run investors. Moreover, for medium-run CEF investors, energy-exporting countries’ EPU risk characteristics is most dynamic. Changes in the EPU risk impact type mainly occurred during the US-China trade war and the outbreak of COVID-19.     

Moral economics

An adequate normative economics – one that is consistent with recent developments in our discipline (and in philosophy and psychology) and that resonates with widely held moral intuitions – will have to address the following challenges. First, utility cannot be both the basis of our predictions of economic behaviour and the evaluation of the outcomes of this behaviour. Second, we need to conceive of individual well-being and other desiderata in ways that are interpersonally comparable and that go beyond efficiency and fairness. Third, the representation of the economy as a ‘morality-free zone’ (requiring that contracts, including employment contracts, are complete) must give way to a recognition of the unaccountable exercise of power by private actors, even in a perfectly competitive equilibrium, and the way that this may violate democratic principles and limit the freedom and compromise the dignity of other actors. Fourth, the commitment to ‘liberal neutrality’ (thereby sidestepping the evaluation of preferences) and the related assumption of ‘unrestricted preferences’ in mechanism design and public policy must be abandoned, making room for a concern about the nature of our preferences and the ways that institutions shape our values.     

浅析女装设计中的“儿童化”倾向

随着时代快速的发展,人们对于服装的要求已不简单是功能性与技术性,更加关注服装带给人的情感需要。"儿童化"的女装设计运用逆向思维将童趣理念载入服装中,形成一种稚趣、幽默、俏皮、轻松的设计风格,将成年女装实现了"减龄化",迎合了人们对服装的情感需要,在这个宣扬年轻的社会中为成年女性着装多提供了一种选择。本文分析了女装"儿童化"设计的造型特征、色彩与图案、材料、配饰几方面的表现手法,探讨了儿童语言在成年女装中的运用。