Organizations & Markets

We empirically analyze the illicit trade in cultural property and antiques, taking advantage of different reporting incentives between source and destination countries. We thus generate a measure of illicit trafficking in these goods based on the difference between imports recorded in United States' customs data and the (purportedly identical) trade as recorded by customs authorities in exporting countries.

This paper studies the value of external commitment to policy reforms in the case of WTO/GATT accessions. The accessions often entail reforms that go beyond narrowly defined trade liberalization, and have to overcome fierce resistance in the acceding countries, as reflected in protracted negotiations. We study the growth and investment consequences of WTO/GATT accessions, with attention to a possible selection bias. We find that the accessions tend to raise income, but only for those countries that were subject to rigorous accession procedures.

We introduce a "bad environment-good environment" technology for consumption growth in a consumption-based asset pricing model. Using the preference structure from Campbell and Cochrane (1999), the model generates realistic time-varying volatility, skewness and kurtosis in fundamentals while still permitting closed-form solutions for asset prices. The model not only fits standard salient asset prices features including means and volatilities for equity returns and risk free rates, but also generates a realistic variance premium and option prices.

The current work seeks to understand the relationship between luck beliefs and achievement motivation. We hypothesized and found evidence that belief in stable rather than fleeting luck positively relates to achievement motivation (Study 1). Furthermore, belief in stable luck affects achievement motivation via personal agency beliefs (Study 2). These findings add to our understanding of the causal beliefs associated with a sense of mastery and preference for challenging tasks.

Bicultural individuals vary in the degree to which their two cultural identities are integrated versus conflicting — Bicultural Identity Integration (BII). Past research on attribution biases finds that BII influences the way that biculturals shift in response to cultural primes: integrated biculturals shift assimilatively, whereas conflicted biculturals shift contrastively. Proposing that this reflects assimilation versus reactance responses, we tested whether it extends to shifts in self-perceived personality.

The rate of increase of longevity has varied considerably across U.S. states since 1991. This paper examines the effect of the quality of medical care, behavioral risk factors (obesity, smoking, and AIDS incidence), and other variables (education, income, and health insurance coverage) on life expectancy and medical expenditure using longitudinal state-level data. We examine the effects of three different measures of the quality of medical care. The first is the average quality of diagnostic imaging procedures, defined as the fraction of procedures that are advanced procedures.

This chapter discusses Markov Chain Monte Carlo (MCMC) based methods for estimating continuous-time asset pricing models. We describe the Bayesian approach to empirical asset pricing, the mechanics of MCMC algorithms and the strong theoretical underpinnings of MCMC algorithms. We provide a tutorial on building MCMC algorithms and show how to estimate equity price models with factors such as stochastic expected returns, stochastic volatility and jumps, multi-factor term structure models with stochastic volatility, time-varying central tendancy or jumps and regime switching models.

Financial openness is often associated with higher rates of economic growth. We show that the impact of openness on factor productivity growth is more important than the effect on capital growth. This explains why the growth effects of liberalization appear to be largely permanent, not temporary. We attribute these permanent liberalization effects to the role financial openness plays in stock market and banking sector development, and to changes in the quality of institutions. We find some indirect evidence of higher investment efficiency post-liberalization.

This paper examines liquidity and how it affects the behavior of mutual fund portfolio managers, who account for a significant portion of trading in many assets. We define an asset to be perfectly liquid if a portfolio manager can trade the quantity she desires when she desires at a price not worse than the uninformed expected value. A portfolio manager is limited by both what she needs to attain and the ease with which she can attain it, making her sensitive to three dimensions of liquidity: price, timing, and quantity.