INCOMPLETE SOCIAL CONTRACTS

There is a long normative ‘Social Contract’ tradition that attempts to characterize ex‐post income inequalities that are agreeable to all ‘behind a veil of ignorance.’ This paper takes a similar normative approach to characterize social decision‐making procedures. It is shown that quite generally some form of majority‐voting is preferred to unanimity ‘behind a veil of ignorance’ whenever society faces deadweight costs in making compensating transfers. Deviations from unanimity (or ex‐post Pareto optimality) are ex‐ante efficient to the extent that they economize on costly compensating transfers. Put another way, the optimal decision rule trades off the benefits of minority protection and those from greater flexibility. (JEL: H11, G33, G34, D63, P16, P48)     

International Business Cycles with Endogenous Incomplete Markets

Backus, Kehoe, and Kydland (1992), Baxter and Crucini (1995), and Stockman and Tesar (1995) find two major discrepancies between standard international business cycle models with complete markets and the data: In the models, cross‐country correlations are much higher for consumption than for output, while in the data the opposite is true; and cross‐country correlations of employment and investment are negative, while in the data they are positive. This paper introduces a friction into a standard model that helps resolve these anomalies. The friction is that international loans are imperfectly enforceable; any country can renege on its debts and suffer the consequences for future borrowing. To solve for equilibrium in this economy with endogenous incomplete markets, the methods of Marcet and Marimon (1999) are extended. Incorporating the friction helps resolve the anomalies more than does exogenously restricting the assets that can be traded.     

Chance Constrained Programming Approach to Empirical Analyses of Mutual Fund Investment Strategies*

Chance constrained programming concepts are used to formalize risk and return relations which are then modeled for use in an empirical study of mutual fund behavior during the period 1984 through 1988. The publicly announced strategies of individual funds are used to form ex ante risk classifications which are employed in examining ex post performance. Negative relations between risk and return held in every year of the period studied. The bearing of these negative risk-return findings for the Bowman paradox, as studied in the strategic management literature, are thus extended from the industrial firms studied by Bowman (and others) and shown to be present even in these investment oriented mutual funds in each of the years of the great bull market from 1984 through 1988. Finally, our use of chance constrained programming enables us to separate risk from return behavior and evaluate their relative strengths as sources of these negative relations, which are found to be more in the returns than the risks.     

Coordinated Action in the Massively Multiplayer Online Game World of Warcraft

In tandem with the technological advancement of immersive virtual environments, digital games have evolved into complex social worlds where people play collaboratively to achieve individual‐ and group‐oriented goals. The massively multiplayer online games genre has received international attention for the large numbers of users that commit a significant amount of time and effort to online play. Play styles within such game worlds are diverse, but “raiding” is generally considered among gamers and scholars alike to be the most challenging form of collaborative play. Like other forms of social activity, raiding is predicated on players' abilities to successfully coordinate individual lines of action. Yet the vast majority of raiders are not physically copresent during their collaborative efforts. Using Couch's theory of coordinated action as an interpretive frame, we explore the computer‐mediated process of raiding in the massively multiplayer online game World of Warcraft by analyzing ethnographic data and audio/visual recordings of gameplay. Our study expands Couch's theory of coordinated action in two ways. First, we demonstrate how individuals and groups simultaneously engage in multiple forms of coordinated activity (e.g., conflict and cooperation). Second, we reveal two semiotic layers of coordinated action—the “subject‐subject” (i.e., intersubjective) layer that is facilitated through the game's user interface, and the “subject‐object” layer that comprises players' interactions with the user interface itself. Our study thus considers the potential of Couch's theory for the study of computer‐mediated communication and nonhumans in interaction.     

Elitism and stochastic dominance

Stochastic dominance has been typically used with a special emphasis on risk and inequality reduction something captured by the concavity of the utility function in the expected utility model. We claim that the applicability of the stochastic dominance approach goes far beyond risk and inequality measurement provided suitable adaptations be made. We apply in this article the stochastic dominance approach to the measurement of elitism which may be considered the opposite of egalitarianism. While the usual stochastic dominance quasi-orderings attach more value to more equal and more efficient distributions, our criteria ensure that, the more unequal and the more efficient the distribution, the higher it is ranked. Two instances are provided by (i) comparisons of scientific performance across institutions like universities or departments, and (ii) comparisons of affluence as opposed to poverty between countries.     

Promoting walking among older adults living in retirement communities

The authors tested the feasibility and acceptability, and explored the outcomes, of 2 walking interventions based on ecological models among older adults living in retirement communities. An enhanced intervention (EI) was compared with a standard walking intervention (SI) among residents in 4 retirement facilities (N = 87 at baseline; mean age = 84.1 yr). All participants received a walking intervention including pedometers, printed materials, and biweekly group sessions. EI participants also received phone counseling and environmental-awareness components. Measures included pedometer step counts, activities of daily living, environment-related variables, physical function, depression, cognitive function, satisfaction, and adherence. Results indicated improvements among the total sample for step counts, neighborhood barriers, cognitive function, and satisfaction with walking opportunities. Satisfaction and adherence were high. Both walking interventions were feasible to implement among facility-dwelling older adults. Future studies can build on this multilevel approach.     

Linking human factors to corporate strategy with cognitive mapping techniques

For human factors (HF) to avoid being considered of "side-car" status, it needs to be positioned within the organization in such a way that it affects business strategies and their implementation. Tools are needed to support this effort. This paper explores the feasibility of applying a technique from operational research called cognitive mapping to link HF to corporate strategy. Using a single case study, a cognitive map is drawn to reveal the complex relationships between human factors and achieving an organization's strategic goals. Analysis of the map for central concepts and reinforcing loops enhances understanding that can lead to discrete initiatives to facilitate integration of HF. It is recommended that this technique be used with senior managers to understand the organizations` strategic goals and enhance understanding of the potential for HF to contribute to the strategic goals.     

Does ethnic origin determine integration success? A comparison of immigration policies in Germany and Japan

The paper analyzes public policy and public opinion responses toward immigrants in Germany and Japan, two countries whose immigration policies have relied on blood purity (jus sanguinis). The paper retraces the rationale for jus sanguinis and contends that it was adopted at the turn of the century in both countries out of political convenience. The principles and goals of immigration policies are compared cautioning that better principles must not mean better outcomes.

It is reiterated that Germany has made a politically motivated move away from the ethnic monocultural concept, whereas Japan still hangs on more or less to the old model of silent and subtle assimilation. The more dissuasive Japanese model of tight immigration control, deportation and monocultural assimilation isthen compared to the more permissive German immigration model. A comparison of identity discourses in the form of Japanese Nihonjinron and German Leitkultur shows that both countries struggle with identifying and asserting their core values and that this has a negative impact on integration issues. The paper concludes that Germany has failed to bear the full consequences of its ambitious plans by taking into account the values, beliefs and worldviews of its immigrants, whereas Japan continues to treat immigrants as temporary guests denying any need for long-term integration.