{"title":"Corporate Disclosure Quality and Institutional Investors' Holdings During Market Downturns","authors":"Hua Cheng, Dayong Huang, Yan Luo","doi":"10.2139/ssrn.3248246","DOIUrl":"https://doi.org/10.2139/ssrn.3248246","url":null,"abstract":"Abstract We examine institutional investors' responses to corporate disclosure quality conditional on market states. Transient institutions react more positively to corporate disclosure quality during market downturns than during normal market periods, as better disclosure practices lower information asymmetry and are thus associated with reduced uncertainty, enhanced liquidity, and weakened impacts of crises, which are the most desirable features of assets during market downturns. Dedicated institutions are insensitive to corporate disclosure quality in both normal and market downturn periods, as they have access to inside information and rely less on public disclosures. Their reliance on corporate disclosures in market downturns, however, increases sharply after the implementation of Regulation Fair Disclosure, which removes their inside information advantage. We further show that corporate disclosure reduces information asymmetry to a greater extent in market downturns than in normal market periods and that transient ownership in market downturns provides strong price support and stabilizes return volatility, whereas dedicated ownership does not possess such functions. Finally, we show that the results are not simply driven by endogeneity and are robust to alternative corporate disclosure quality measure and to the control of other determinants of institutional holdings.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"12 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128949191","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Integrating Formal and Informal Institutions: Towards a Healthy Community in the Pacific","authors":"Lhawang Ugyel","doi":"10.2139/ssrn.3216239","DOIUrl":"https://doi.org/10.2139/ssrn.3216239","url":null,"abstract":"The role of institutions, both formal and informal, are important for the development of a country. While existing literature tends to focus primarily on formal institutions, informal institutions play a vital role in the delivery of public services in countries where formal institutions are weak. This paper analyses the integration of formal and informal institutions, using the Bougainville Healthy Communities Program’s (BHCP) delivery of public health services in the Autonomous Region of Bougainville in Papua New Guinea (PNG) as a case study. It examines how an operative framework that combines formal and informal institutions is able to determine positive outcomes. The integrations take place at various levels between government and non-government sectors, as well as between formal and informal institutions. While the findings can be applied to PNG and other, similar, countries, particularly developing and post-conflict countries, this case study is important for Bougainville itself. In the next year or two, Bougainville will have a referendum on its future status, and the need for a strong governance system at the national and community levels will be of paramount importance.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"66 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-07-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126208893","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Toward a Market Epistemology of the Platform Economy","authors":"L. Kiesling","doi":"10.2139/ssrn.3229917","DOIUrl":"https://doi.org/10.2139/ssrn.3229917","url":null,"abstract":"The platform economy reflects the business model of some of the largest and fastest-growing firms in the economy. Platform business models emerge and thrive because of the potential profit in taking advantage of transactions cost reductions to connect people for mutual benefit, and this value creation is best understood by thinking about the epistemology of decentralized market processes. Three essential aspects of knowledge are relevant to platform business models: (1) knowledge can be private and diffuse; (2) knowledge can be contextual; and (3) knowledge may not exist outside of the economic process. After defining and analyzing the technology, economic, and institutional aspects of platforms the author defines and applies market epistemology to explore how platforms harness technological and organizational features to create value-enhancing market platforms by exploiting the epistemic benefits of technology-enabled decentralized market processes. The author concludes by using this epistemic framework to propose an electricity distribution platform business model – the retail electricity industry is undergoing a process of technological dynamism, and as a regulated infrastructure industry, evolving into a decentralized market industry is presenting challenges to which this epistemic framework can bring increased understanding.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-07-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122572360","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"IQ and Economic Volatility","authors":"R. Hafer","doi":"10.2139/ssrn.3202328","DOIUrl":"https://doi.org/10.2139/ssrn.3202328","url":null,"abstract":"Do countries with higher levels of national IQ have less volatile growth of real economic output compared with lower-IQ countries? This issue has not been addressed. Using a large sample of countries, a simple bivariate correlation indicates that IQ and economic volatility are negatively related. Estimating a regression model of volatility that includes IQ with a number of control variables, the estimated coefficient on IQ is consistently negative and significant. On average, a one-standard deviation increase in IQ is associated with about a 30 percent reduction in economic volatility. The evidence indicates that higher IQ countries have more stable economies.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"16 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127944308","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"When Roving Bandits Settle Down: Club Theory and the Emergence of Government","authors":"A. Young","doi":"10.2139/ssrn.3200023","DOIUrl":"https://doi.org/10.2139/ssrn.3200023","url":null,"abstract":"How does a government arise from anarchy? In a classic article, Mancur Olson (1993) theorized that it could occur when a roving bandit decides to settle down. This stationary bandit comes to recognize an encompassing interest in its territory, improving its lot by providing governing and committing to stable rates of theft (taxation). The bandits highlighted by Olson (1993) are not individuals but rather groups organized to act collectively. I provide a club-theoretic (Buchanan 1965) analysis of bandits. I characterize the (actual or threats of) violence as a club good, i.e., one that is non-rival but from which out-group members can be excluded. I elaborate on the changes in the club’s group interest and in-group that will likely accompany the roving-to-stationary transition. To illustrate the salient points of the analysis, I provide a case study of the Visigoths: their emergence as a roving confederacy in the late fourth century, their migration and subsequent settlement, and the establishment of the Visigothic Kingdom.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"56 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131654724","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Industry vs Services: Do Enforcement Institutions Matter for Specialization Patterns? Disaggregated Evidence from Spain","authors":"Juan S. Mora-Sanguinetti, R. Spruk","doi":"10.2139/ssrn.3169811","DOIUrl":"https://doi.org/10.2139/ssrn.3169811","url":null,"abstract":"Este documento estima el efecto de la calidad de las instituciones en el patron de especializacion productiva observado en Espana en el periodo 1999-2014 a nivel local. La investigacion parte de la observacion de que la actividad economica en Espana muestra un fuerte patron de especializacion geografica: las regiones menos especializadas en manufacturas o actividades industriales y orientadas al sector servicios en el sur (como Andalucia o Extremadura) contrastan con regiones mas industrializadas o con mayor intensidad manufacturera en el norte, como el Pais Vasco, Navarra o Aragon. Para realizar el analisis, construimos tasas de congestion judicial a nivel provincial para las jurisdicciones civil, administrativa y social y estimamos su efecto sobre el peso del sector manufacturero y el sector servicios en el PIB provincial. Para que la estimacion sea consistente, analizamos las diferencias historicas en la vigencia de Derecho foral o especial y las relacionamos con la eficacia del sistema judicial hoy. Tras utilizar diversas tecnicas de estimacion, los resultados muestran un efecto fuerte y persistente de la eficacia judicial sobre la especializacion productiva a nivel provincial. Mas en concreto, las provincias en las que historicamente ha \u0000habido vigencia de Derecho foral o especial tienen una probabilidad significativamente mayor de que la eficacia judicial sea mas alta hoy. A su vez, una mayor eficacia judicial facilita la especializacion de la provincia en actividades manufactureras de alta productividad y una menor eficacia fomenta la especializacion en el sector servicios. El efecto de la eficacia judicial sobre la especializacion productiva parece robusto en distintas verificaciones y parece ser causal. Por ultimo, las tres jurisdicciones serian relevantes para explicar la especializacion, si bien parece tener un impacto mas pronunciado la jurisdiccion administrativa que la laboral o la civil.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"8 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-04-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121260640","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Effects of Trade, Aid, and Investment on China's Image in Developing Countries","authors":"Vera Z. Eichenauer, A. Fuchs, Lutz Brückner","doi":"10.2139/ssrn.3147206","DOIUrl":"https://doi.org/10.2139/ssrn.3147206","url":null,"abstract":"One goal of China’s Go Out policy is to create goodwill in countries around the world. At the same time, China’s growing economic engagement has provoked much criticism. This paper is the first to study whether these activities change the attitudes of individuals in developing countries towards China at both the national and subnational level. Using repeated cross-sectional survey data from the Latinobarometro, we analyze whether and how growing amounts of exports, foreign aid, and foreign direct investment from China to Latin America affect opinions on China within 18 Latin American countries over the 2002-2013 period. We run instrumental-variables regressions by exploiting exogenous variation in the supply of Chinese exports, aid, and investment proxied by China’s market penetration of developing countries outside Latin America. In contrast to the widespread criticism, we do not find evidence that China’s growing economic activities in the respective countries deteriorate average attitudes towards China — neither at the national nor the provincial level. However, our results show that the young, educated, and economically privileged population develops more positive views of China. We interpret this as evidence that China’s economic engagement creates winners and losers.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"96 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129523951","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Cybersocialism: A Reassessment of the Socialist Calculation Debate","authors":"E. Limas","doi":"10.2139/ssrn.3117890","DOIUrl":"https://doi.org/10.2139/ssrn.3117890","url":null,"abstract":"This article presents a new approach to the socialist calculation debate. I focus particularly on the question of how to integrate information of consumers’ preferences and argue that the objections raised by Austrian economists against the socialist model proposed by Oskar Lange can be addressed within the current level of technological development. I propose that preferences of consumers can be revealed by their web search queries and also that, given the amount of information available, it would be possible to analyze consumers’ preferences in terms of hierarchical choices that distinguish between needs and subneeds.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"433 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-02-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122803215","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Public-Private Monopoly","authors":"Marian W. Moszoro","doi":"10.2139/ssrn.2383309","DOIUrl":"https://doi.org/10.2139/ssrn.2383309","url":null,"abstract":"This article presents comparative statics of organizational modes of natural monopoly in public utilities with a focus on co-ownership and co-governance. Private monopoly lowers output and increases the price to maximize profit; public monopoly incurs higher costs due to the lack of know-how; and a regulated monopoly results in regulation costs to overcome informational asymmetries. A public–private partnership arises as an efficient organization mode when it enables the internalization of private know-how and saves regulation costs due to correspondingly sufficient private and public residual control rights. Public–private partnerships support higher prices than marginal costs due to rent sharing, with its upper price frontier decreasing in private residual control rights.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"13 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124647964","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Exit, Voice, and Forking","authors":"Alastair Berg, C. Berg","doi":"10.2139/ssrn.3081291","DOIUrl":"https://doi.org/10.2139/ssrn.3081291","url":null,"abstract":"This paper offers a new framework to understand institutional change in human societies. An ‘institutional fork’ occurs when a society splits into two divergent paths with shared histories. The idea of forking comes from the open-source software community where developers are free to copy of a piece of software, alter it, and release a new version of that software. The parallel between institutional choice and software forking is made clear by the function and politics of forking in blockchain implementations. Blockchains are institutional technologies for the creation of digital economies. When blockchains fork they create two divergent communities with shared transaction ledgers (histories). The paper examines two instances of institutional forks. Australia can be seen as a successful fork of the United Kingdom. The New Australia settlement in Paraguay can be seen as an unsuccessful fork of Australia.","PeriodicalId":330992,"journal":{"name":"New Institutional Economics eJournal","volume":"57 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-12-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130839150","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}