Entry and Exit in OTC Derivatives Markets

We develop a parsimonious model to study the equilibrium and socially optimal decisions of banks to enter, trade in, and possibly exit, an OTC market. Although we endow all banks with the same trading technology, banks' optimal entry and trading decisions endogenously lead to a realistic market structure composed of dealers and customers with distinct trading patterns. We decompose banks' entry incentives into incentives to hedge risk and incentives to make intermediation profits. We show that dealer banks enter more than is socially optimal. In the face of large negative shocks, they may also exit more than is socially optimal when markets are not perfectly resilient.     

Inference on Causal Effects in a Generalized Regression Kink Design

We consider nonparametric identification and estimation in a nonseparable model where a continuous regressor of interest is a known, deterministic, but kinked function of an observed assignment variable. We characterize a broad class of models in which a sharp “Regression Kink Design” (RKD or RK Design) identifies a readily interpretable treatment‐on‐the‐treated parameter (Florens, Heckman, Meghir, and Vytlacil (2008)). We also introduce a “fuzzy regression kink design” generalization that allows for omitted variables in the assignment rule, noncompliance, and certain types of measurement errors in the observed values of the assignment variable and the policy variable. Our identifying assumptions give rise to testable restrictions on the distributions of the assignment variable and predetermined covariates around the kink point, similar to the restrictions delivered by Lee (2008) for the regression discontinuity design. Using a kink in the unemployment benefit formula, we apply a fuzzy RKD to empirically estimate the effect of benefit rates on unemployment durations in Austria.     

THE INEFFICIENCY OF WORKER TIME USE

Much work is carried out in short, interrupted segments. This phenomenon, which we label task juggling, has been overlooked by economists. We study the work schedules of some judges in Italy documenting that they do juggle tasks and that juggling causally lowers their productivity substantially. To measure the size of this effect, we show that although all these judges receive the same workload, those who juggle more trials at once instead of working sequentially on few of them at each unit of time, take longer to complete their portfolios of cases. Task juggling seems to have no adverse effect on the quality of the judges' decisions, as measured by the percent of decisions appealed. To identify these causal effects we estimate models with judge fixed effects and we exploit the lottery assigning cases to judges. We discuss whether task juggling can be viewed as inefficient, and provide a back‐of‐the‐envelope calculation of the social cost of longer trials due to task juggling.     

Exploring the relationship between product-service system and profitability

Journal of Management and Governance - Over the last few decades there has been a significant change in the economic output worldwide, and services have become more and more important....     

Environmental changes to increase physical activity: perceptions of older urban ethnic-minority women

Despite the numerous benefits of physical activity, older adults continue to be more sedentary than their younger counterparts, and sedentary behavior is more prevalent among older racial and ethnic minorities than among Whites. This study used the nominal group technique (NGT) to examine participants' perceptions of what neighborhood environmental changes would encourage greater physical activity for older African American and Hispanic women. Participants age 50-75 years were recruited from 2 urban community health clinics. Nine NGT sessions (45 participants) were conducted. The women were asked what changes in their neighborhood environment would encourage them to become more physically active. Responses to the research question were tabulated, and qualitative analysis was used to identify themes and categories. Major categories were physical environment changes, safety, and activities/social support. Although the physical environment received the greatest number of points, concerns for personal safety cut across categories. Participants indicated the need for more facilities in which to be active.     

The Importance of Racial Socialization: School‐Based Racial Discrimination and Racial Identity Among African American Adolescent Boys and Girls

This study examined various parental racial socialization messages as mediators between school‐based racial discrimination and racial identity formation over 4 years for African American boys (N = 639) and African American girls (N = 711). Findings indicated that school‐based racial discrimination was associated with racial identity beliefs. For African American boys, behavioral racial socialization messages mediated the relation between school‐based racial discrimination and racial centrality over time. Mediation also resulted for African American girls, but for a different set of race‐related messages (negative messages and racial barriers) and racial identity beliefs. The developmental significance of the findings and implications for future research are discussed.     

‘Car Talk’: automobility and Chinese international students in Michigan

The apparent conspicuous consumption of luxury vehicles by Chinese international students attending a public Michigan University provides an opportunity to examine the convergence of different ideas about automobility. Upwardly mobile Chinese families send their children to Michigan, a state with a tradition of auto-production, for educational opportunities not available in China. The resulting ‘car talk’ of local residents about Chinese students and their cars speaks to broader anxieties about Michigan’s shifting relationship to the global economy. However, the paper focuses on the meanings of auto-owning created by Chinese students who make decisions about the purchase and use of their autos within a social world oriented primarily to other Chinese students and societal ideas about auto-owning circulating among friends, family and society in China. For Chinese students, car owning encompasses meanings of status, safety and sociability that are created within the context of study abroad.     

Establishing Safety in Emotionally Focused Couple Therapy: A Single‐Case Process Study

Emotionally Focused Couple Therapy (EFT) is an effective approach to working with distressed couples. It is not only effective in reducing relationship distress, but also in successfully maintaining gains over time. In the current study, we sought to understand the therapy processes that result in the creation of safety during stage one of EFT. Safety is a key ingredient in stage one, setting the stage for deeper interpersonal and intrapsychic work in later stages of treatment. In order to achieve the study aim, we analyzed video recordings of the first six sessions of a single couple case from an EFT randomized controlled trial. Using a theory building case study approach, results reveal that all expected components related to the creation of safety were achieved. Additional findings from our analyses indicate that the therapist was highly active, especially in seizing key moments in the therapy provided by this particular case, which shifted the couple in the direction of safety and deescalated their interactional cycle. Implications of key findings are discussed.     

Over‐indebtedness and microcredit in Cambodia: Moving beyond borrower‐centric frames

Over the past two decades, Cambodia has experienced an unprecedented credit boom, a growth in lending so rapid that the International Monetary Fund (IMF) referred to it as “one of the fastest financial deepening episodes by historical cross‐cultural standards” (IMF, 2016, p. 4). This deepening has been driven by the expansion of microcredit. In tandem, over‐indebtedness has increased among microcredit borrowers, and debt has become a significant political and economic concern. This article explores how over‐indebtedness is understood and explained by stakeholders across microcredit value chains. To do so, we draw on interviews with microfinance institution (MFI) executives, investors, branch managers, partners, financial literacy trainers, loan officers and borrowers in Siem Reap and Phnom Penh. We find that across the sector, dominant framings of over‐indebtedness privilege borrower‐centric explanations, while discounting the structural drivers of excessive lending and borrowing. As a consequence, current efforts to limit over‐indebtedness are unlikely to produce the kinds of solutions that are most needed to reduce the debt stress among borrowers. These arguments have implications across the Global South, particularly for contexts where microfinance is rapidly expanding.     

When is n large enough? Looking for the right sample size to estimate proportions

The central limit theorem indicates that when the sample size goes to infinite, the sampling distribution of means tends to follow a normal distribution; it is the basis for the most usual confidence interval and sample size formulas. This study analyzes what sample size is large enough to assume that the distribution of the estimator of a proportion follows a Normal distribution. Also, we propose the use of a correction factor in sample size formulas to ensure a confidence level even when the central limit theorem does not apply for these distributions.