WHAT IS HAPPENING TO THE IMPACT OF FINANCIAL DEEPENING ON ECONOMIC GROWTH?

Although the finance‐growth relationship is now firmly entrenched in the empirical literature, we show that it is not as strong in more recent data as it was in the original studies with data for the period from 1960 to 1989. We consider several explanations. First, we find that the incidence of financial crises is related to the dampening of the effect of financial deepening on growth. Excessive financial deepening or too rapid a growth of credit may have led to both inflation and weakened banking systems which in turn gave rise to growth‐inhibiting financial crises. Excessive financial deepening may also be a result of widespread financial liberalizations in the late 1980s and early 1990s in countries that lacked the legal or regulatory infrastructure to exploit financial development successfully. However, we find little indication that liberalizations played an important direct role in reducing the effect of finance. Similarly, there is little evidence that the growth of equity markets in recent years has substituted for debt financing and led to a reduced role of financial deepening on growth. (JEL E44, G10, O40)     

A Class of Convolution‐Based Models for Spatio‐Temporal Processes with Non‐Separable Covariance Structure

Abstract. In this article, we propose a new parametric family of models for real‐valued spatio‐temporal stochastic processes S ( x , t ) and show how low‐rank approximations can be used to overcome the computational problems that arise in fitting the proposed class of models to large datasets. Separable covariance models, in which the spatio‐temporal covariance function of S ( x , t ) factorizes into a product of purely spatial and purely temporal functions, are often used as a convenient working assumption but are too inflexible to cover the range of covariance structures encountered in applications. We define positive and negative non‐separability and show that in our proposed family we can capture positive, zero and negative non‐separability by varying the value of a single parameter.     

Governing the transnational organic cotton network from Benin

In this article, we attempt to conceptualize the historical development and the governance structure of the transnational organic cotton network from Benin. We aim to discover how the organic cotton production‐consumption network is governed locally and internationally. Existing bodies of literature on international agricultural production networks, in particular the Global Value Chains (GVC) perspective, focus on economic dimensions, but find it difficult to incorporate the sustainability dimension. We favour widening the concept of GVCs beyond economics by acknowledging and including environmental rationalities and the representatives of their interests, not as external elements, but rather as co‐governing or co‐structuring factors (or actors) of sustainable value chains. Our findings reveal that beyond the traditional producer versus buyer dualism, intermediate stakeholders, namely transnational and local environmental NGO networks, are instrumental in the construction, maintenance and transformation of the organic cotton network. It is also apparent that farmers' leaders play an important role in mediating and (re)building trust among organic farmers, though they exert insufficient vertical power in the organic cotton network to control it.     

Construction and Deconstruction of Essence in Representating Social Groups: Identity Projects, Stereotyping, and Racism

Projecting essence onto a social category means to think, talk, and act as if the category were a discrete natural kind and as if its members were all endowed with the same immutable attributes determined by the category's essence. Essentializing may happen implicitly or on purpose in representing ingroups and outgroups. We argue that essentializing is a versatile representational tool (a) that is used to create identity in groups with chosen membership in order to make the group appear as a unitary entity, (b) that outsiders often draw on a group's essentialist self-construal in their judgements about the groups, (c) that judgements about members of forced social categories are often informed by essentialist thinking that easily switches to discrimination and racism, and (d) that under certain historical and political conditions members of social categories and groups may contest their essentialized identity, such as parts of the feminist movement, or that they may attempt to reconstruct an essentialized identity, such as parts of the homosexual movement or the largely defunct European nobility. Besides explicit political and power interests, we see communication processes and language use as a tacit force driving essentialization of social categories.     

Reception Centres: an Index of Social Service Inadequacy

Summary This article examines reception centres, evaluates the adversecriticism there has been of them and suggests that it has divertedattention from the more important issue that the continued existenceand changed role of reception centres indicates the inadequacyof other health and social services     

Are We Thinking Straight? The Politics of Straightness in a Lesbian and Gay Social Movement Organization

Daniel Cortese's book, ‘Are we thinking straight: Thepolitics of straightness in a lesbian and gay social movementorganization’ examines the political strategies of theUSA organization, the Straight and Gay Alliance (SAGA), andits efforts to promote ‘safe schools’ for lesbian,gay, bisexual and trans youth (LGBT). The book's main focusis on how SAGA deploys the involvement of ‘straight’or heterosexually-identified individuals as part of SAGA's publicpolitical agenda. As a national organization with numerous localchapters across the United States, SAGA encourages parents,teachers and students to work together to ensure that schoolsactively protect LGBT students from homophobic     

Probabilistic Insurance

Probabilistic insurance is an insurance policy involving a small probability that the consumer will not be reimbursed. Survey data suggest that people dislike probabilistic insurance and demand more than a 20% reduction in the premium to compensate for a 1% default risk. While these preferences are intuitively appealing they are difficult to reconcile with expected utility theory. Under highly plausible assumptions about the utility function, willingness to pay for probabilistic insurance should be very close to willingness to pay for standard insurance less the default risk. However, the reluctance to buy probabilistic insurance is predicted by the weighting function of prospect theory. This finding highlights the potential role of the weighting function to explain insurance.