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on Regulation |
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Issue of 2005‒09‒17
seven papers chosen by Christian Calmes Université du Québec en Outaouais, Canada |
| By: | Christoph Engel (Max-Planck-Institute for Research on Collective Goods) |
| Abstract: | Corporate actors differ from individuals in one important respect: technically, it may be possible to observe the formation of the corporate will from outside, and to impact on its formation. This feature can be exploited by regulators. One technology is inducing corporate actors to hire an interface actor, representing the regulatory cause at the interior of the firm. Regulators are corporate actors as well. Statutes usually do not fully determine their behaviour. Therefore, firms may induce the regulator to give an interface actor access to the regulatory arena. This interface actor has the task of representing the commercial cause in regulatory decision-making. The paper uses a principal-agent-supervisor model to analyse each of these cases separately, and to demonstrate how the reciprocal nature of the relationship may be exploited. |
| Keywords: | principal-agent-supervisor, corporate actor, corporate governance, regulatory procedure, governance, interface actor |
| JEL: | C72 D23 D73 K22 K23 K32 L51 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2005_15&r=reg |
| By: | Philipp Engler (Free University Berlin); Terhi Jokipii (Institute for International Integration Studies, Trinity College Dublin); Christian Merkl (Kiel Institute for World Economics and Kiel University); Pablo Rovira Kaltwasser (Catholic University of Leuven); Lúcio Vinhas de Souza (Kiel Institute for World Economics.) |
| Abstract: | This paper analyzes the role of bank capitalization on the transmission of monetary policy, using a quarterly dataset for Austrian banks spanning from 1997 to 2003. A substantial understanding of the transmission mechanism in different countries of the euro zone is not only of academic interest, but also an important prerequisite for central bankers to effectively accomplish their monetary policy goals. While we do find evidence in favor of the bank lending channel, with an important role active for capitalization, we are unable to confirm whether the bank capital channel is in force in Austria. Our results indicate some counter-cyclicality in lending activity, a finding that is in line with the existing Austrian literature. |
| Keywords: | Transmission of monetary policy; Bank capital regulation; Austria |
| JEL: | E4 E5 |
| Date: | 2005–05–23 |
| URL: | http://d.repec.org/n?u=RePEc:onb:oenbwp:99&r=reg |
| By: | Kolm, Ann-Sofie (Dept. of Economics, Stockholm University); Nielsen, Søren Bo (Department of Economics, Copenhagen Business School) |
| Abstract: | To examine the effects on labor market performance of government tax and enforcement policies, this paper develops an equilibrium model featuring tax evasion, matching frictions, and worker-firm wage bargains. In the wage bargains, workers and firms can agree on the amount of remuneration that should not be reported to the tax authorities. We find that increased taxation actually reduces unemployment, whereas more zealous enforcement has the opposite effect. |
| Keywords: | Unemployment; matching; wage bargaining; tax evasion |
| JEL: | H26 J41 J64 |
| Date: | 2005–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2005_0005&r=reg |
| By: | Stefan Voigt |
| Abstract: | Judicial independence is not only a necessary condition for the impartiality of judges, it can also endanger it: judges that are independent could have incentives to remain uninformed, become lazy or even corrupt. It is therefore often argued that judicial independence and judicial accountability are competing ends. In this paper, it is, however, hypothesized that they are not necessarily competing ends but can be complementary means towards achieving impartiality and, in turn, the rule of law. It is further argued that judicial accountability can increase per capita income through various channels one of which is the reduction of corruption. First tests concerning the economic effects of JA are carried out drawing on the absence of corruption within the judiciary as well as data gathered by the U.S. State Department as proxies. On the basis of 75 countries, these proxies are highly significant for explaining differences in per capita income. |
| Keywords: | Judicial Independence; judicial accountability; rule of law; economic growth; corruption; constitutional political economy. |
| JEL: | H11 K40 O40 P51 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:icr:wpicer:19-2005&r=reg |
| By: | Hongbin Cai; Hanming Fang; Lixin Colin Xu |
| Abstract: | Entertainment and Travel Costs (ETC) is a standard expenditure item for Chinese firms with an annual amount equal to about 20 percent of total wage bills. We use this objective accounting measure as a basis to analyze the composition of ETC and the effect of ETC on firm performance. We rely on the predictions from a simple but plausible model of managerial decision-making to identify components of ETC by examining how the total ETC responds to different environmental variables. In our empirical analysis we find strong evidence that firms. ETC consists of a mix that includes bribery to government officials both as “grease money” and “protection money,” expenditures to build relational capital with suppliers and clients, and managerial excesses. ETC overall has a significantly negative effect on firm performance, but its negative effect is much less pronounced for those firms located in cities with low quality government service, those who are subject to severe government expropriation, and those who do not have strong relationship with suppliers and clients. Our findings have important implications on how to effectively curb corruption. |
| JEL: | L2 O1 H2 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11592&r=reg |
| By: | Jennifer Hunt |
| Abstract: | Using detailed Peruvian data measuring bribery, I assess which types of public official are most corrupt and why. I distinguish between the bribery rate and the size of bribes received, and seek to explain the variation in each across public institutions. The characteristics of officials’ clients explain most of the variation for bribery rates, but none for bribe amounts. A measure of the speed of honest service at the institution explains much of the remaining variation for both bribery rates and amounts. The results indicate that the bribery rate is higher at institutions with bribe-prone clients, and that bribery rates and bribe amounts are higher where clients are frustrated at slow service. Faster and better service would reduce corruption. Overall, the judiciary and the police are by far the most corrupt institutions. |
| JEL: | K4 H4 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11595&r=reg |
| By: | Francisco Caravia (División de Estudios Mercados No Regulados, Fiscalía Nacional Económica de Chile.); Eduardo Saavedra (ILADES-Georgetown University, Universidad Alberto Hurtado) |
| Abstract: | La reciente liberalización del mercado de generación eléctrica para clientes regulados autoriza a las empresas distribuidoras a contratar energía a precios que pueden ser superiores al precio nudo fijado por el regulador, traspasándolos íntegramente a sus consumidores. Motivado en esta reforma legal, este artículo analiza el equilibrio que resulta de una subasta hipotética en que una empresa distribuidora contrataría su energía. El modelo supone dos empresas generadoras, una hidráulica y otra térmica, ambas aversas al riesgo, que compiten ofertando precio por la energía subastada de un único distribuidor, vendiendo o comprando en el mercado spot sus diferencias de producción. Se supone además que generación hidráulica es estocástica, mientras que por simpleza se supone que la generación térmica es segura. Se demuestra que si la subasta es competitiva, ésta se adjudica a la generadora que fija el precio del mercado spot del sistema cuando hay sequía. Así, la empresa térmica es la que margina cuando la sequía es moderada, ofertando un precio mayor que el precio nudo o promedio del costo marginal esperado del sistema. Por otro lado, si la sequía es extrema al punto de generar desabastecimiento, entonces será la firma hidráulica la que ofrecerá el menor precio en la subasta. Los resultados son robustos a suponer si la sequía extrema es o no fuerza mayor (artículo 99 bis de la Ley Eléctrica). Por último, se encuentra que si ambas generadoras fueran neutrales al riesgo ofrecerían el mismo precio en la subasta e igual al precio nudo regulado, haya o no riesgo de desabastecimiento en períodos secos. |
| Keywords: | Subasta, Energía, Abastecimiento incierto, Racionamiento Eléctrico |
| JEL: | D44 D81 L43 L94 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:ila:ilades:inv169&r=reg |