Found 578 article(s) in category 'Regulation'

The Real Effects of Capital Controls: Firm-Level Evidence from a Policy Experiment

The Real Effects of Capital Controls: Firm-Level Evidence from a Policy Experiment. Laura Alfaro, June 2017, Paper, “This paper evaluates the effects of capital controls on firm-level stock returns and real investment using data from Brazil. On average, there is a statistically significant drop in cumulative abnormal returns consistent with an increase in the cost of capital for Brazilian firms following capital control announcements. Large firms and the largest exporting firms appear less negatively affected compared to external-finance-dependent firms, and capital controls on equity inflows have a more negative announcement effect on equity returns than those on debt inflows. Overall, the findings have implications for macro-finance models that abstract from heterogeneity at the firm level to examine the optimality of capital control taxation.Link

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Multinationals as Global Institution: Power, Authority and Relative Autonomy

Multinationals as Global Institution: Power, Authority and Relative Autonomy. John Gerard Ruggie, June 8, 2017, Paper, “This article aims to inform the long-standing and unresolved debate between voluntary corporate social responsibility and initiatives to impose binding legal obligations on multinational enterprises. The two approaches share a common feature: neither can fully specify its own scope conditions, that is, how much of the people and planet agenda either can expect to deliver. The reason they share this feature is also the same: neither is based on a foundational political analysis of the multinational enterprise in the context of global governance.Link

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Should Governments Invest More in Nudging?

Should Governments Invest More in Nudging? Cass Sunstein, June 5, 2017, Paper, “Governments are increasingly adopting behavioral science techniques for changing individual behavior in pursuit of policy objectives. The types of “nudge” interventions that governments are now adopting alter people’s decisions without coercion or significant changes to economic incentives. We calculated ratios of impact to cost for nudge interventions and for traditional policy tools, such as tax incentives and other financial inducements, and we found that nudge interventions often compare favorably with traditional interventions. We conclude that nudging is a valuable approach that should be used more often in conjunction with traditional policies, but more calculations are needed to determine the relative effectiveness of nudging.Link

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Harvard Business School Professor Explains the Most Important Problem We Have In Finance Today And How To Fix It

Harvard Business School Professor Explains the Most Important Problem We Have In Finance Today And How To Fix It. Mihir Desai, June 5, 2017, Video, “Mihir Desai, a professor of Harvard Business School and the author of “Wisdom of Finance” explains why having shareholders who are separate from the managers hold great danger for finance today. Following is a transcript of the video.Link

 

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The Economics (and Politics) of Trump’s Paris Withdrawal

The Economics (and Politics) of Trump’s Paris Withdrawal. Robert Stavins, June 6, 2017, Opinion, “The announcement on June 1 by President Donald Trump that he will withdraw the United States from the Paris climate agreement was misguided, and the justifications Trump provided were — at best — misleading and, to some degree, simply untruthful. Withdrawing from the Paris agreement will be damaging both to the United States and the world. Sadly, Trump’s withdrawal announcement makes clear that the president has little understanding of the nature of the agreement, the process for withdrawal, or the implications of withdrawal for the United States, let alone for the world.Link

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The Hazards of Expert Control: Chief Risk Officers and Risky Derivatives

The Hazards of Expert Control: Chief Risk Officers and Risky Derivatives. Frank Dobbin, May 31, 2017, Paper, “At the turn of the century, regulators introduced policies to control bank risk-taking. Many banks appointed chief risk officers (CROs), yet bank holdings of new, complex, and untested financial derivatives subsequently soared. Why did banks expand use of new derivatives? We suggest that CROs encouraged the rise of new derivatives in two ways. First, we build on institutional arguments about the expert construction of compliance, suggesting that risk experts arrived with an agenda of maximizing risk-adjusted returns, which led them to favor the derivatives. Second, we build on moral licensing arguments to suggest that bank appointment of CROs induced “organizational licensing,” leading trading-desk managers to reduce policing of their own risky behavior.Link

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How Laws and Culture Hold Back Socially Minded Companies

How Laws and Culture Hold Back Socially Minded Companies. George Serafeim, May 17, 2017, Paper, “Lots of business leaders want their organizations to have a positive social impact. They’d like to pursue a purpose and do good, not just deliver financial results. So why don’t they? In our conversations with business leaders we have heard two recurring obstacles: a culture of short-termism and the fact that corporate law puts shareholders first.Link

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Human Agency and Behavioral Economics Nudging Fast and Slow

Human Agency and Behavioral Economics: Nudging Fast and Slow. Cass Sunstein, 2017, Book, “This groundbreaking series is designed to make available in book form unique behavioral economic contributions. It provides a publishing opportunity for behavioral economist authors who have a novel perspective and have developed a special ability to integrate economics with other disciplines. It will allow these authors to fully develop
their ideas. In general, it is not a place for narrow technical contributions. Theoretical/conceptual, empirical, and policy contributions are all
welcome.Link

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