Showing papers in "Social Science Research Network in 2015"
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TL;DR: In this article, the authors derive the prices of primitive securities from call options on aggregate consumption, and derive an equilibrium valuation of assets with uncertain payoffs at many future dates by using the Black-Scholes equation.
Abstract: This paper implements the time-state preference model in a multi-period economy, deriving the prices of primitive securities from the prices of call options on aggregate consumption. These prices permit an equilibrium valuation of assets with uncertain payoffs at many future dates. Furthermore, for any given portfolio, the price of a $1.00 claim received at a future date, if the portfolio's value is between two given levels at that time, is derived explicitly from a second partial derivative of its call-option pricing function. An intertemporal capital asset pricing model is derived for payoffs that are jointly lognormally distributed with aggregate consumption. It is shown that using the Black-Scholes equation for options on aggregate consumption implies that individuals' preferences aggregate to isoelastic utility.
1,911 citations
TL;DR: The results show that participation in CC is motivated by many factors such as its sustainability, enjoyment of the activity as well as economic gains, and suggest that in CC an attitude‐behavior gap might exist; people perceive the activity positively and say good things about it, but this good attitude does not necessary translate into action.
Abstract: Information and communications technologies (ICTs) have enabled the rise of so-called “Collaborative Consumption” (CC): the peer-to-peer-based activity of obtaining, giving, or sharing the access to goods and services, coordinated through community-based online services. CC has been expected to alleviate societal problems such as hyper-consumption, pollution, and poverty by lowering the cost of economic coordination within communities. However, beyond anecdotal evidence, there is a dearth of understanding why people participate in CC. Therefore, in this article we investigate people’s motivations to participate in CC. The study employs survey data (N = 168) gathered from people registered onto a CC site. The results show that participation in CC is motivated by many factors such as its sustainability, enjoyment of the activity as well as economic gains. An interesting detail in the result is that sustainability is not directly associated with participation unless it is at the same time also associated with positive attitudes towards CC. This suggests that sustainability might only be an important factor for those people for whom ecological consumption is important. Furthermore, the results suggest that in CC an attitudebehavior gap might exist; people perceive the activity positively and say good things about it, but this good attitude does not necessary translate into action.
1,496 citations
TL;DR: In this paper, the authors argue that the global financial cycle is not aligned with countries' specific macroeconomic conditions and propose a convex combination of targeted capital control, macroprudential control, and stricter limit on leverage for all financial intermediaries.
Abstract: There is a global financial cycle in capital flows, asset prices and in credit growth. This cycle co‐moves with the VIX, a measure of uncertainty and risk aversion of the markets. Asset markets in countries with more credit inflows are more sensitive to the global cycle. The global financial cycle is not aligned with countries’ specific macroeconomic conditions. Symp toms can go from benign to large asset price bubbles and excess credit creation, which are among the best predictors of financial crises. A VAR analysis suggests that one of the determinants of the global financial cycle is monetary policy in the centre country , which affects leverage of global banks, capital flows and credit growth in the international financial system. Whenever capital is freely mobile, the global financial cycle constrains national monetary policies regardless of the exchange rate regime. For the past few decades, international macroeconomics has postulated the “trilemma”: with free capital mobility, inde pendent monetary policies are feasible if and only if exchange rates are floating. The global financial cycle transforms the trilemma into a “dilemma” or an “irreconcilable duo”: independent monetary policies are possible if and only if the capital account is managed. So should policy restrict capital mobility? Gains to international capital flows have proved elusive whether in calibrated models or in the data. Large gross flows disrupt asset markets and financial intermediation, so the costs may be very large. To deal with the global financial cycle and the “dilemma”, we have the following policy options: ( a) targeted capital controls; (b) acting on one of the sources of the financial cyc le itself, the monetary policy of the Fed and other main central banks; (c) acting on the transmission channel cyclically by limiting credit growth and leverage during the upturn of the cycle, using national macroprudential policies; (d) acting on the transmission channel structurally by imposing stricter limit s on leverage for all financial intermediaries. We argue for a convex combination of (a), (c) and (d).
1,428 citations
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TL;DR: A discussion forum based around Thomas Piketty's book, Capital in the twenty-first century, with a number of economists from academia, public sector bodies and private sector institutions was held at the Centre for Economic Policy Research and the Bank of England.
Abstract: On 19 December 2014, the Centre for Economic Policy Research and the Bank of England hosted a discussion forum based around Thomas Piketty’s book, Capital in the twenty-first century, with a number of economists from academia, public sector bodies and private sector institutions. Four speakers presented research on various issues relating to inequality, including: access to education; wealth and taxation policy; and the role of governance and institutions. This article presents each speaker’s key arguments, and includes a summary of the open-floor debate that followed.
1,286 citations
TL;DR: In this paper, a strong negative relationship between firm-level capital investment and the aggregate level of uncertainty associated with future policy and regulatory outcomes is found, and the relation between policy uncertainty and capital investment is not uniform in the cross section, being significantly stronger for firms with a higher degree of investment irreversibility and for firms more dependent on government spending.
Abstract: Using the policy uncertainty index of Baker, Bloom, and Davis (2013), we document a strong negative relationship between firm-level capital investment and the aggregate level of uncertainty associated with future policy and regulatory outcomes. More importantly, we find evidence that the relation between policy uncertainty and capital investment is not uniform in the cross section, being significantly stronger for firms with a higher degree of investment irreversibility and for firms which are more dependent on government spending. Our results lend empirical support to the notion that policy uncertainty can depress corporate investment by inducing precautionary delays due to investment irreversibility.
1,164 citations
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TL;DR: An interpretive framework is presented that analyzes the definitional perspectives and the applications of big data, and a general taxonomy is provided that helps broaden the understanding ofbig data and its role in capturing business value.
Abstract: Big data has the potential to revolutionize the art of management. Despite the high operational and strategic impacts, there is a paucity of empirical research to assess the business value of big data. Drawing on a systematic review and case study findings, this paper presents an interpretive framework that analyzes the definitional perspectives and the applications of big data. The paper also provides a general taxonomy that helps broaden the understanding of big data and its role in capturing business value. The synthesis of the diverse concepts within the literature on big data provides deeper insights into achieving value through big data strategy and implementation.
1,024 citations
TL;DR: This article considers the issue of opacity as a problem for socially consequential mechanisms of classification and ranking, such as spam filters, credit card fraud detection, search engines, news trends, market segmentation and advertising, insurance or loan qualification, and credit scoring.
Abstract: This article considers the issue of opacity as a problem for socially consequential mechanisms of classification and ranking, such as spam filters, credit card fraud detection, search engines, news trends, market segmentation and advertising, insurance or loan qualification, and credit scoring. These mechanisms of classification all frequently rely on computational algorithms, and in many cases on machine learning algorithms to do this work. In this article, I draw a distinction between three forms of opacity: (1) opacity as intentional corporate or state secrecy (2) opacity as technical illiteracy, and (3) an opacity that arises from the characteristics of machine learning algorithms and the scale required to apply them usefully. The analysis in this article gets inside the algorithms themselves. I cite existing literatures in computer science, known industry practices (as they are publicly presented), and do some testing and manipulation of code as a form of lightweight code audit. I argue that recognizing the distinct forms of opacity that may be coming into play in a given application is key to determining which of a variety of technical and non-technical solutions could help to prevent harm.
928 citations
TL;DR: This paper employed an approximation that makes a nonlinear term structure model extremely tractable for analysis of an economy operating near the zero lower bound for interest rates, which can be used to summarize the macroeconomic effects of unconventional monetary policy.
Abstract: This paper employs an approximation that makes a nonlinear term structure model extremely tractable for analysis of an economy operating near the zero lower bound for interest rates. We show that such a model offers an excellent description of the data compared to the benchmark model and can be used to summarize the macroeconomic effects of unconventional monetary policy. Our estimates imply that the efforts by the Federal Reserve to stimulate the economy since July 2009 succeeded in making the unemployment rate in December 2013 1% lower, which is 0.13% more compared to the historical behavior of the Fed.
847 citations
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TL;DR: This article critically evaluated research on the incremental and construct validity of the multi-informant approach to clinical child and adolescent assessment, and identified crucial gaps in knowledge for future research, and provided recommendations for "best practices" in using and interpreting multi-Informant assessments in clinical work and research.
Abstract: Child and adolescent patients may display mental health concerns within some contexts and not others (e.g., home vs. school). Thus, understanding the specific contexts in which patients display concerns may assist mental health professionals in tailoring treatments to patients’ needs. Consequently, clinical assessments often include reports from multiple informants who vary in the contexts in which they observe patients’ behavior (e.g., patients, parents, teachers). Previous meta-analyses indicate that informants’ reports correlate at low-to-moderate magnitudes. However, is it valid to interpret low correspondence among reports as indicating that patients display concerns in some contexts and not others? We meta-analyzed 341 studies published between 1989 and 2014 that reported cross-informant correspondence estimates, and observed low-to-moderate correspondence (mean internalizing: r = .25; mean externalizing: r = .30; mean overall: r = .28). Informant pair, mental health domain, and measurement method moderated magnitudes of correspondence. These robust findings have informed the development of concepts for interpreting multi-informant assessments, allowing researchers to draw specific predictions about the incremental and construct validity of these assessments. In turn, we critically evaluated research on the incremental and construct validity of the multi-informant approach to clinical child and adolescent assessment. In so doing, we identify crucial gaps in knowledge for future research, and provide recommendations for “best practices” in using and interpreting multi-informant assessments in clinical work and research. This article has important implications for developing personalized approaches to clinical assessment, with the goal of informing techniques for tailoring treatments to target the specific contexts where patients display concerns.
815 citations
TL;DR: In this paper, the authors suggest ways in which top managers can help themselves learn to avoid crisis through continuous unlearning, and suggest ways to help themselves to learn from crisis situations.
Abstract: Crises force organizations to replace top managers, so top managers should try to avoid crises through continuous unlearning. The authors suggest ways in which top managers can help themselves unlearn.
749 citations
TL;DR: A five-factor model that adds profitability and investment factors to the three factor model of Fama and French (1993) largely absorbs the patterns in average returns is proposed in this article, which fails to capture fully the low average returns of small stocks whose returns behave like those of low profitability firms that invest aggressively.
Abstract: Average stock returns for North America, Europe, and Asia Pacific increase with the book-to-market ratio (B/M) and profitability and are negatively related to investment. For Japan the relation between average returns and B/M is strong, but average returns show little relation to profitability or investment. A five-factor model that adds profitability and investment factors to the three-factor model of Fama and French (1993) largely absorbs the patterns in average returns. As in Fama and French (2015a,b), the model’s prime problem is failure to capture fully the low average returns of small stocks whose returns behave like those of low profitability firms that invest aggressively.
TL;DR: In this paper, a five-factor model that adds profitability (RMW) and investment (CMA) factors to the three factor model of Fama and French (1993) suggests a shared story for several average-return anomalies.
Abstract: A five-factor model that adds profitability (RMW) and investment (CMA) factors to the three-factor model of Fama and French (1993) suggests a shared story for several average-return anomalies. Specifically, positive exposures to RMW and CMA (returns that behave like those of the stocks of profitable firms that invest conservatively) capture the high average returns associated with low market β, share repurchases, and low stock return volatility. Conversely, negative RMW and CMA slopes (like those of relatively unprofitable firms that invest aggressively) help explain the low average stock returns associated with high β, large share issues, and highly volatile returns.
TL;DR: This work analyzes restaurant reviews identified by Yelp's filtering algorithm as suspicious, or fake, and treats these as a proxy for review fraud, finding that a restaurant is more likely to commit review fraud when its reputation is weak, or it has recently received bad reviews.
Abstract: Consumer reviews are now part of everyday decision-making. Yet, the credibility of these reviews is fundamentally undermined when businesses commit review fraud, creating fake reviews for themselves or their competitors. We investigate the economic incentives to commit review fraud on the popular review platform Yelp, using two complementary approaches and datasets. We begin by analyzing restaurant reviews that are identified by Yelp's filtering algorithm as suspicious, or fake ― and treat these as a proxy for review fraud (an assumption we provide evidence for). We present four main findings. First, roughly 16% of restaurant reviews on Yelp are filtered. These reviews tend to be more extreme (favorable or unfavorable) than other reviews, and the prevalence of suspicious reviews has grown significantly over time. Second, a restaurant is more likely to commit review fraud when its reputation is weak, i.e., when it has few reviews, or it has recently received bad reviews. Third, chain restaurants ― which benefit less from Yelp ― are also less likely to commit review fraud. Fourth, when restaurants face increased competition, they become more likely to receive unfavorable fake reviews. Using a separate dataset, we analyze businesses that were caught soliciting fake reviews through a sting conducted by Yelp. These data support our main results, and shed further light on the economic incentives behind a business's decision to leave fake reviews.
TL;DR: In this paper, the authors explore worker experiences within the on-demand economy and argue that Uber's digitally and algorithmically mediated system of flexible employment builds new forms of surveillance and control into the experience of using the system, resulting in asymmetries around information and power for workers.
Abstract: This empirical study explores labor in the on-demand economy using the rideshare service Uber as a case study. By conducting sustained monitoring of online driver forums and interviewing Uber drivers, we explore worker experiences within the on-demand economy. We argue that Uber’s digitally and algorithmically mediated system of flexible employment builds new forms of surveillance and control into the experience of using the system, which result in asymmetries around information and power for workers. In Uber’s system, algorithms, CSRs, passengers, semiautomated performance evaluations, and the rating system all act as a combined substitute for direct managerial control over drivers, but distributed responsibility for remote worker management also exacerbates power asymmetries between Uber and its drivers. Our study of the Uber driver experience points to the need for greater attention to the role of platform disintermediation in shaping power relations and communications between employers and workers.
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TL;DR: Using a recent IMF survey and expanding on previous studies, the authors document the use of macro-prudential policies for 119 countries over the 2000-13 period, covering many instruments.
Abstract: Using a recent IMF survey and expanding on previous studies, we document the use of macroprudential policies for 119 countries over the 2000-13 period, covering many instruments. Emerging economies use macroprudential policies most frequently, especially foreign exchange related ones, while advanced countries use borrower-based policies more. Usage is generally associated with lower growth in credit, notably in household credit. Effects are less in financially more developed and open economies, however, and usage comes with greater cross-border borrowing, suggesting some avoidance. And while macroprudential policies can help manage financial cycles, they work less well in busts.
TL;DR: Most of the time, organizations generate actions unreflectively and nonadaptively as discussed by the authors, creating problems, successes, threats, and opportunities to justify their actions, creating ideological molecules that mix values, goals, expectations, perceptions, theories, plans, and symbols.
Abstract: Most of the time, organizations generate actions unreflectively and nonadaptively. To justify their actions, organizations create problems, successes, threats and opportunities. These are ideological molecules that mix values, goals, expectations, perceptions, theories, plans, and symbols. The molecules form while people are result watching, guided by the beliefs that they should judge results good or bad, look for the causes of results, and propose needs for action. Because Organizations modify their behavior programs mainly in small increments that make sense to top managers, they change too little and inappropriately, and nearly all organizations disappear within a few years.
TL;DR: In this article, the authors analyse the evolution of FinTech over the past 150 years, and on the basis of this analysis, argue against its too-early or rigid regulation at this juncture.
Abstract: “FinTech”, a contraction of “Financial technology”, refers to technology enabled financial solutions. It is often seen today as the new marriage of financial services and information technology. However, the interlinkage of finance and technology has a long history and has evolved over three distinct eras, during which finance and technology have evolved together: first in the analogue context then with a process of digitalization of finance from the late twentieth century onwards. Since 2008, a new era of FinTech has emerged in both the developed and developing world. This era is defined not by the financial products or services delivered but by who delivers them and the application of rapidly developing technology at the retail and wholesale levels. This latest evolution of FinTech, led by start-ups, poses challenges for regulators and market participants alike, particularly in balancing the potential benefits of innovation with the possible risks of new approaches. We analyse the evolution of FinTech over the past 150 years, and on the basis of this analysis, argue against its too-early or rigid regulation at this juncture.
TL;DR: It is argued that its widespread deployment will lead to expansion of a new subset of law, which is term Lex Cryptographia: rules administered through self-executing smart contracts and decentralized (autonomous) organizations.
Abstract: Just as decentralization communication systems lead to the creation of the Internet, today a new technology — the blockchain — has the potential to decentralize the way we store data and manage information, potentially leading to a reduced role for one of the most important regulatory actors in our society: the middleman. Blockchain technology enables the creation of decentralized currencies, self-executing digital contracts (smart contracts) and intelligent assets that can be controlled over the Internet (smart property). The blockchain also enables the development of new governance systems with more democratic or participatory decision-making, and decentralized (autonomous) organizations that can operate over a network of computers without any human intervention. These applications have lead many to compare the blockchain to the Internet, with accompanying predictions that this technology will shift the balance of power away from centralized authorities in the field of communications, business, and even politics or law.In this Article, we explore the benefits and drawbacks of this emerging decentralized technology and argue that its widespread deployment will lead to expansion of a new subset of law, which we term Lex Cryptographia: rules administered through self-executing smart contracts and decentralized (autonomous) organizations. As blockchain technology becomes widely adopted, centralized authorities, such as governmental agencies and large multinational corporations, could lose the ability to control and shape the activities of disparate people through existing means. As a result, there will be an increasing need to focus on how to regulate blockchain technology and how to shape the creation and deployment of these emerging decentralized organizations in ways that have yet to be explored under current legal theory.
TL;DR: The authors discusses the empirical literature on the economic consequences of disclosure and financial reporting regulation (including IFRS adoption), drawing on U.S. and international evidence, highlighting the challenges with quantifying regulatory costs and benefits, measuring disclosure and reporting outcomes, and drawing causal inferences from regulatory studies.
Abstract: This paper discusses the empirical literature on the economic consequences of disclosure and financial reporting regulation (including IFRS adoption), drawing on U.S. and international evidence. Given the policy relevance of research on regulation, we highlight the challenges with: (i) quantifying regulatory costs and benefits, (ii) measuring disclosure and reporting outcomes, and (iii) drawing causal inferences from regulatory studies. Next, we discuss empirical studies that link disclosure and reporting activities to firm-specific and market-wide economic outcomes. Understanding these links is important when evaluating regulation. We then synthesize the empirical evidence on the economic effects of disclosure regulation and reporting standards, including the evidence on IFRS adoption. Several important conclusions emerge. We generally lack evidence on market-wide effects and externalities from regulation, yet such evidence is central to the economic justification of regulation. Moreover, evidence on causal effects of disclosure and reporting regulation is still relatively rare. We also lack evidence on the real effects of such regulation. These limitations provide many research opportunities. We conclude with several specific suggestions for future research.
TL;DR: A new international blueprint for disaster risk reduction (DRR) has been adopted in Sendai, Japan, at the end of the Third UN World Conference on Disaster Risk Reduction (WCDRR, March 14-18, 2015).
Abstract: In March 2015, a new international blueprint for disaster risk reduction (DRR) has been adopted in Sendai, Japan, at the end of the Third UN World Conference on Disaster Risk Reduction (WCDRR, March 14-18, 2015). We review and discuss the agreed commitments and targets, as well as the negotiation leading the Sendai Framework for DRR (SFDRR) and discuss briefly its implication for the later UN-led negotiations on sustainable development goals and climate change.
TL;DR: It is confirmed that, in the early 1990s, analysts issue more pessimistic recommendations for firms with high CSR ratings, but analysts progressively assess these firms more optimistically over time.
Abstract: We explore the impact of corporate social responsibility (CSR) ratings on sell-side analysts’ assessments of firms’ future financial performance. We suggest that when analysts perceive CSR as an agency cost, due to the prevalence of an agency logic, they produce pessimistic recommendations for firms with high CSR ratings. Moreover, we theorize that over time, the emergence of a stakeholder focus, and the gradual weakening of the agency logic, shifts the analysts’ perceptions of CSR ratings and results in increasingly less pessimistic recommendations for firms with high CSR ratings. Using a large sample of publicly traded US firms over 15 years, we confirm that in the early 1990s, analysts issue more pessimistic recommendations for firms with high CSR ratings. However, in more recent years analysts progressively assess these firms less pessimistically, and eventually they assess them optimistically. Furthermore, we find that more experienced analysts and analysts at higher-status brokerage houses are the first to shift the relation between CSR ratings and investment recommendation optimism. We find no significant link between firms’ CSR ratings and analysts’ forecast errors, indicating that learning is unlikely to account for the observed shifts in recommendations.
TL;DR: This introduction to a special issue of "Telecommunications Policy" entitled "The Governance of Social Media" begins with a definition of social media that informs all contributions in the special issue, and synthesize definitions presented in the literature.
Abstract: This introduction to a special issue of "Telecommunications Policy" entitled "The Governance of Social Media" begins with a definition of social media that informs all contributions in the special issue. A section describing the challenges associated with the governance of social media is presented next, followed by an overview of the various articles included in the special issue.While the Internet and the World Wide Web have always been used to facilitate social interaction, the emergence and rapid diffusion of Web 2.0 functionalities during the first decade of the new millennium enabled an evolutionary leap forward in the social component of web use. This and falling costs for online data storage made it feasible for the first time to offer masses of Internet users access to an array of user-centric spaces they could populate with user-generated content, along with a correspondingly diverse set of opportunities for linking these spaces together to form virtual social networks.To define “social media” for our current purposes, we synthesize definitions presented in the literature and identify the following commonalities among current social media services:1) Social media services are (currently) Web 2.0 Internet-based applications,2) User-generated content is the lifeblood of social media,3) Individuals and groups create user-specific profiles for a site or app designed and maintained by a social media service,4) Social media services facilitate the development of social networks online by connecting a profile with those of other individuals and/or groups.Transformative communication technologies have always called for regulatory innovation. Theodor Vail’s vision of “one policy, one system, universal service” preceded more than one-hundred years of innovative regulations aimed at connecting all Americans to a single telephone network. The sinking of the Titanic, caused in part by “chaos in the spectrum” led to the Radio Act of 1912 and the creation of a command and control model designed to regulate broadcast radio. Safe-harbor hours were put in place after a father and son heard George Carlin’s “seven dirty words” routine over the radio in their car. The fairness doctrine and the minority tax certificate program were designed to address inequalities in the broadcast television industry. The Digital Millennium Copyright Act responded to intellectual property concerns raised by a global Internet and the FCC’s 700mhz auction was the result of demand for smarter mobile phones. Now we must consider the role of regulatory innovation in response to the emergence of social media.
TL;DR: In this article, the authors employed a systematic procedure to review the literature on universities-industry collaboration (UIC) and identified five key aspects, which underpinned the theory of UIC.
Abstract: The collaboration between universities and the industry is increasingly perceived as a vehicle to enhance innovation through knowledge exchange. This is evident by a significant increase in studies that investigate the topic from different perspectives. However, this body of knowledge is still described as fragmented and lacks efficient comprehensive view. To address this gap, we employed a systematic procedure to review the literature on universities-industry collaboration (UIC). The review resulted in identifying five key aspects, which underpinned the theory of UIC. We integrate these key aspects into an overarching process framework, which together with the review, provide a substantial contribution by creating an integrated analysis of the state of literature concerning this phenomenon. Several research avenues are reported as distilled from the analysis.
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TL;DR: In this paper, the authors argue that the critique of the smart city in its historical and geographical context should be paid to the actually existing smart city, rather than the exceptional or paradigmatic smart cities of Songdo, Masdar and Living PlanIT Valley.
Abstract: This paper grounds the critique of the ‘smart city’ in its historical and geographical context. Adapting Brenner and Theodore’s notion of ‘actually existing neoliberalism’, we suggest a greater attention be paid to the ‘actually existing smart city’, rather than the exceptional or paradigmatic smart cities of Songdo, Masdar and Living PlanIT Valley. Through a closer analysis of cases in Louisville and Philadelphia, we demonstrate the utility of understanding the material effects of these policies in actual cities around the world, with a particular focus on how and from where these policies have arisen, and how they have unevenly impacted the places that have adopted them.
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TL;DR: What it is and how it prompts managers to think about business practice in new and innovative ways is explained and a framework of three gamification principles—mechanics, dynamics, and emotions (MDE)—are presented to explain how gamified experiences can be created.
Abstract: There is growing interest in how gamification – defined as the application of game design principles in non-gaming contexts – can be used in business. However, academic research and management practice have paid little attention to the challenges of how best to design, implement, manage, and optimize gamification strategies. To advance understanding of gamification, this article defines what it is and explains how it prompts managers to think about business practice in new and innovative ways. Drawing upon the game design literature, we present a framework of three gamification principles – mechanics, dynamics, and emotions (MDE) – to explain how gamified experiences can be created. We then provide an extended illustration of gamification and conclude with ideas for future research and application opportunities.
TL;DR: In this article, the causality of the positive association between CSR expenditures and future firm performance differs from what is claimed in the vast majority of the literature and that corporate accountability reporting is another channel through which outsiders may infer insiders' private information about firms' future financial prospects.
Abstract: We document that corporate social responsibility (“CSR”) expenditures are not a form of corporate charity nor do they improve future financial performance. Rather, firms undertake CSR expenditures in the current period when they anticipate stronger future financial performance. We show that the causality of the positive association between CSR expenditures and future firm performance differs from what is claimed in the vast majority of the literature and that corporate accountability reporting is another channel through which outsiders may infer insiders’ private information about firms’ future financial prospects.
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TL;DR: In this paper, the authors examined the relationship between financial development, CO2 emissions, trade and economic growth using simultaneous-equation panel data models for a panel of 12 MENA countries over the period 1990-2011.
Abstract: This paper examines the relationship between financial development, CO2 emissions, trade and economic growth using simultaneous-equation panel data models for a panel of 12 MENA countries over the period 1990-2011. Our results indicate that there is evidence of bidirectional causality between CO2 emissions and economic growth. Economic growth and trade openness are interrelated i.e. bidirectional causality. Feedback hypothesis is validated between trade openness and financial development. Neutrality hypothesis is identified between CO2 emissions and financial development. Unidirectional causality running from financial development to economic growth and from trade openness to CO2 emissions is identified. Our empirical results also verified the existence of environmental Kuznets curve. These empirical insights are of particular interest to policymakers as they help build sound economic policies to sustain economic development and to improve the environmental quality.
TL;DR: The authors proposed a dynamic ordinal spatial model to estimate state ideal points from 1946-2012 on a single dimension that reflects state positions towards the U.S. led liberal order, and used information about the content of the UN's agenda to make estimates comparable across time.
Abstract: UN General Assembly votes have become the standard data source for measures of the degree to which states have common preferences over foreign policy. Almost without exception, those papers use dyadic indicators of voting similarity between states. We propose a dynamic ordinal spatial model to estimate state ideal points from 1946-2012 on a single dimension that reflects state positions towards the U.S. led liberal order. We use information about the content of the UN's agenda to make estimates comparable across time. Compared to existing measures, our estimates better separate signal from noise in identifying foreign policy shifts, have greater face validity, allow for better inter-temporal comparisons, are less sensitive to shifts in the UN's agenda, and are strongly correlated with measures of liberalism. We show that the choice of method is consequential with a replication of a prominent application to the democratic peace.
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TL;DR: In this paper, the authors examine how the international business literature has addressed social responsibility issues in the past 50 years, highlighting key developments and implications from a historical perspective, focusing on the Journal of World Business (JWB).
Abstract: This article examines how the international business (IB) literature has addressed social responsibility issues in the past 50 years, highlighting key developments and implications from a historical perspective. Specific attention is paid to the Journal of World Business (JWB), which has covered the whole period and published relevant articles related to these issues, in comparison to the Journal of International Business Studies (JIBS), the other long-standing IB journal. The article outlines that they illustrate different conceptualizations of IB and social responsibility. The 50-year review shows three subthemes: the (green) environment; ethics, rights and responsibilities; poverty and (sustainable) development. These are discussed consecutively, including main contributions and promising areas to further the field.