Climate change represents the grandest of challenges facing humanity. In the space of two centuries of industrial development, human civilization has changed the chemistry of the atmosphere and ...oceans, with devastating consequences. Business organizations are central to this challenge, in that they support the production of escalating greenhouse gas emissions but also offer innovative ways to decarbonize our economies. In this paper, we examine how businesses respond to climate change. Based on five in-depth case studies of major Australian corporations over a 10-year period (2005–2015), we identify three key stages in the corporate translation of climate change: framing, localizing, and normalizing. We develop a grounded model that explains how the revolutionary import of grand challenges is converted into the mundane and comfortable concerns of "business as usual." We find that critique is the major driver of this process by continuously revealing the tensions between the demands of the grand challenge and business imperatives. Our paper contributes to the literature on business and the natural environment by identifying how and why corporate environmental initiatives deteriorate over time. More specifically, we highlight the policy limitations of a reliance on business and market responses to the climate crisis.
Conventional wisdom among policymakers in both the US and Europe holds that weak and failing states are the source of the world's most pressing security threats today. The international community's ...leadership sees such states as an existential threat as well, evidenced in Kofi Annan's 2004 claim that “our defenses are only as strong as their weakest links.” This is not surprising. The most destructive attack on the US in its history originated in one of the world's poorest countries. Deadly communicable diseases seem to constantly emerge from the world's poorest regions, and transnational crime appears to flourish in weakly governed states. However, as this book shows, our assumptions about the threats posed by failed and failing states are based on anecdotal arguments, not on a systematic empirical analysis that traces the connections between state failure and transnational security threats. This book uses an Index of State Weakness as a basis for its findings. The book provides coverage of five key security threats: terrorism, transnational crime, WMDs, pandemic diseases, and energy insecurity. The basic conclusions may seem surprising. While many threats do emerge in failed states, more often than not those states' manifold weaknesses create misery for only their own citizenry. In other words, the problems that flow from Liberia's failures are more typical than those that spread from Afghanistan. Moreover, many of threats originate farther up the chain, in wealthier and more stable countries like Russia, China, and Venezuela. And generic state weakness is not a good threat predictor. Cultural and regional particularities as well as the degree of global integration all influence the threat level. Just as importantly, our tendency to extrapolate an all-encompassing theory connecting weak states and international security threats from turmoil in the Middle East and Southwest Asia is insufficient. The book argues for complexity and nuance, and will force policymakers to rethink what they assume about state failure and transnational insecurity.
We estimate the degree to which individual police officers practice racial discrimination. Using a bunching estimation design and data from the Florida Highway Patrol, we show that minorities are ...less likely to receive a discount on their speeding tickets than White drivers. Disaggregating this difference to the individual police officer, we estimate that 42 percent of officers practice discrimination. We then apply our officer-level discrimination measures to various policy-relevant questions in the literature. In particular, reassigning officers across locations based on their lenience can effectively reduce the aggregate disparity in treatment.
•Prior to the financial crisis, bonds traded by more levered firms were more liquid.•After the crisis, bonds traded by firms with more leverage became less liquid.•The more constrained a firm is ...post-crisis, the lower its client trades intermediation.•Buyers' and sellers' constraints have a similar impact on bond liquidity.
Do regulations decrease dealer ability to intermediate trades? Using a unique dataset of dealer-bond-level transactions, we link changes in liquidity of individual U.S. corporate bonds to dealers' transaction activity and balance sheet constraints. We show that, prior to the financial crisis, bonds traded by more levered institutions and institutions with investment bank like characteristics were more liquid but this relationship reverses after the financial crisis. In addition, institutions that face more regulations after the crisis both reduce their overall volume of trade and have less ability to intermediate customer trades.
We examine gender differences in misconduct punishment in the financial advisory industry. There is a “gender punishment gap”: following an incident of misconduct, female advisers are 20% more likely ...to lose their jobs and 30% less likely to find new jobs, relative to male advisers. The gender punishment gap is not driven by gender differences in occupation, productivity, nature of misconduct, or recidivism. The gap in hiring and firing dissipates at firms with a greater percentage of female managers and executives. We also explore the differential treatment of ethnic minority men and find similar patterns of “in-group” tolerance.
Abstract We analyze the effects of a reform of capital regulation for U.S. insurance companies in 2009. The reform eliminates capital buffers against unexpected losses associated with portfolio ...holdings of MBS, but not for other fixed-income assets. After the reform, insurance companies are much more likely to retain downgraded MBS compared to other downgraded assets. This pattern is more pronounced for financially constrained insurers. Exploiting discontinuities in the reform’s implementation, we can identify the relevance of the capital requirements channel. We also document that the insurance industry crowds outs other investors in the new issuance of (high-yield) MBS. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
Abstract
Two intermediary-based factors—a corporate bond dealer inventory measure and a broad intermediary distress measure—explain more than 40$\%$ of the puzzling common variation in credit spread ...changes beyond canonical structural factors. A simple intermediary-based model with partial market segmentation accounts for intermediary factors’ explanatory power and delivers three further implications with empirical support. First, whereas bond sorts on risk-related variables produce monotonic loading patterns on intermediary factors, non-risk-related sorts produce no pattern. Second, dealer inventory comoves with corporate-credit assets only, whereas intermediary distress comoves with both corporate-credit and non-corporate-credit assets. Third, dealers’ inventory responds to (instrumented) bond sales by institutional investors.
Hospital quality measures are crucial to a key idea behind health care payment reforms: “paying for quality” instead of quantity. Nevertheless, such measures face major criticisms largely over the ...potential failure of risk adjustment to overcome endogeneity concerns when ranking hospitals. In this paper, we test whether patients treated at hospitals that score higher on commonly used quality measures have better health outcomes in terms of rehospitalization and mortality. To compare similar patients across hospitals in the same market, we exploit ambulance company preferences as an instrument for hospital choice. We find that a variety of measures that insurers use to measure provider quality are successful: choosing a high-quality hospital compared to a low-quality hospital results in 10% to 15% better outcomes.
We use novel quarterly data of U.S. states to examine the dynamics of relative spending multipliers in the decade surrounding the Great Recession. While multipliers were around 1 in expansions, they ...reached values above 4 when a state was in a recession. Also a high (low) degree of household indebtedness augmented (lowered) a state's multiplier by 0.5 in expansions and 2 in recessions. We further document modest positive spillover effects across states and show that a mere redistribution of spending across states also had a significant influence on the aggregate U.S. economy due to cross-state heterogeneity of the effects.
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