Going concern modifications and related disclosures in the Italian stock market: do regulatory improvements help investors in capturing financial distress?

Journal of Management and Governance - This paper investigates the investor reaction to audit reports containing a going concern modification (GCM) in the Italian market following new amendments...     

CDS and rating announcements: changing signaling during the crisis?

In parallel with the development of credit derivatives market, researchers have begun to explore the relationship between Credit Default Swap (CDS) market and rating events. Many papers, via classical event-study methodology, show that CDS market is able to signal future negative rating events announced by credit rating agencies. In this work, we incorporate into the event-study methodology the ability of Markov switching models in modeling state-dependent means and variances. This approach allows to get over the drawbacks of the classical methodology, which ignores the heteroscedasticity and volatility clustering often affecting financial time series. The proposed methodology is applied to study the reactions of CDS quotes to reviews for downgrading and effective downgradings announced by the three major credit rating agencies (Fitch Ratings, Moody’s, Standard and Poor’s), in order to examine if and to what extent CDS market anticipates announcements related with a company’s creditworthiness. The analysis, focusing mainly on volatility, is performed on two periods, 2004–2006 and 2007–2009, in order to verify whether a change in the signaling power of CDS quotes can be ascribed to recent financial turmoils.     

Social and Economic Determinants of Reproductive Behavior Before the Fertility Decline. The Case of Six Italian Communities During the Nineteenth Century

In recent decades, main demographic historical research assessed the importance of bio-demographic components in human reproduction, before the diffusion of birth control and contraceptive techniques. According to this dominant view, before fertility decline, marital fertility was mainly regulated by biological and physiological factors and socio-economic factors played only a limited and indirect role. In order to demonstrate the importance of non-biological components, the present study focuses on six pre-transitional communities situated in different geographic areas of Italy. The work aims to demonstrate how fertility levels could significantly be affected by social and economic factors even in natural fertility populations, before the diffusion of contraceptives. Micro-level data are collected from several historical sources, and discrete-time event history models are applied to female reproductive careers in order to estimate effects of socio-economic status, household structure, and price fluctuations on marital fertility, controlling for several bio-demographic factors. Despite clear differences in geographic localization and environment, marital reproductive behavior appeared to be significantly and constantly affected by socio-economic status, household composition, and price levels in all the investigated communities.     

Emotional decision-makers and anomalous attitudes towards information

We use a simple version of the Psychological Expected Utility Model (Caplin and Leahy, Q J Econ 116:55–80, 2001) to analyze the optimal choice of information accuracy by an individual who is concerned with anticipatory feeling. The individual faces the following trade-off: on the one hand information may lead to emotional costs, on the other the higher the information accuracy, the higher the efficiency of decision-making. We completely and explicitly characterize how anticipatory utility depends on information accuracy, and study the optimal amount of information acquisition. We obtain simple and explicit conditions under which the individual prefers no-information or partial information gathering. We show that anomalous attitudes towards information can be more frequent and articulated than previously thought.