Africa and the International Criminal Court

Although three African countries have recently announced their withdrawals from the International Criminal Court (ICC), a mass exodus does not appear imminent. Perceptions of the Court's bias towards African member-states are exaggerated, and it has begun to challenge major powers. Exceptions to the ICC's prosecutorial obligations allowing member-states greater flexibility to accommodate conflict resolution efforts among other situations could make African member-states less hostile to the Court.     

Explaining the failure of the ASEAN economic community: the primacy of domestic political economy

All reliable indicators suggest that ASEAN's (Association of Southeast Asian Nations) Economic Community (AEC) will not be successfully established by its 2015 deadline. Why? Against technocratic, realist and constructivist accounts, this article offers an explanation rooted in the political economy of ASEAN's member-states. Economic liberalisation agreements promote the rescaling of economic governance, involving regulatory changes that may radically redistribute power and resources. Consequently, they are heavily contested between coalitions of social and political forces, without outcomes reflecting the outcome of these struggles. The argument is demonstrated by exploring the uneven sectoral liberalisation achieved under the AEC, the constrained integration of ASEAN's energy markets, and the limited deregulation of skilled labour migration.     

China's dual strategy of coercion and inducement towards ASEAN

ABSTRACT

This article contributes to the discussion about China's divisive influence on the Association of Southeast Asian Nations (ASEAN). It argues that recent China–ASEAN relations are based on Beijing's successful implementation of a dual strategy of coercion and inducement. The effectiveness of this strategy is tested against the South China Sea disputes – the issue that lies in the core of regional security and a key platform of power display. The article outlines Beijing's recent interaction with individual ASEAN member-states and its implications for the regional multilateral diplomacy. While by no means identical, Beijing's dual strategy of coercion and inducement with individual ASEAN states have resulted in an effective abuse of the ASEAN consensus principle – a tactic often referred to as ‘divide and rule’. Consequently, the group's internal discord has further eroded and affected the institutional confidence of ASEAN. This article draws attention to the psychological effect of coercion as a perception of punishment, and inducement as a perception of reward.     

US presidential elections and real GDP growth, 1961–2004

In this paper I show that, since 1960, an electoral cycle in US output growth can both be seen by the naked eye in the raw data and confirmed by a statistical analysis that allows for rational partisan effects as well as a wide range of control variables. That is, controlling for multiple lags of interest rate changes, inflation, money growth, energy prices, lagged output growth, government spending (or its growth) and temporary partisan effects, the timing of elections exerts a significant influence on quarterly real GDP growth.     

Gerrymandering and the Voting Rights Act of 1982: A public choice analysis of turnover in the U.S. House of Representatives

The present paper uses various data sets and statistical techniques to examine the outcome of gerrymandering under the Voting Rights Act of 1982 on turnover rates in the U.S. House of Representatives, as well as the competitiveness in Party primaries for House seats. Evidence presented here suggests that political redistricting at the federal level (namely for U.S. House seats) has tended to favor incumbents in both the Party primaries and general elections. In fact, some results suggest that turnover rates (for 1988) are between 8.9 and 10.3 percentage points lower within states that engaged in such redistricting efforts. Our findings generally support the main tenets of the public choice view of legislator behavior.     

Southern European Public Bureaucracies in Comparative Perspective

The public bureaucracies of Greece, Italy, Portugal and Spain may be set apart from the rest of West European bureaucracies. Until the mid-1990s, the former were distinguished from the latter by certain interrelated structural characteristics. These characteristics were extended politicisation of the top administrative ranks; enduring patronage patterns in recruitment to the public sector; uneven distribution of human resources; formalism and legalism; and, with the exception of Spain, absence of a typical European administrative elite. The characteristics were related to the type of capitalism and political development in Southern Europe. South European bureaucracies have started evolving towards decentralisation and privatisation. However, convergence with the bureaucracies of other EU member-states is an open question.     

Taxation and the Veil of Ignorance – A Real Effort Experiment on the Laffer Curve

In this paper we address the role of theveil of ignorance on work incentives andtax rates in a two-person real effortexperiment. We find that effort levelsdecrease with a rise in tax rates. Taxrevenues peak at intermediate tax rates of50% to 65%, supporting the existence of aLaffer curve in taxation. Tax authoritiesdo not exploit their power to tax in full,which is compatible both with revenuemaximizing but also fair behavior. Behindthe veil of ignorance, subjects care morefor efficiency and restrict the power totax more than in case their position(taxpayer or tax authority) is fixed inadvance.     

Migration and public trust in the commonwealth of independent states

Since the collapse of the Soviet Union, the post-Soviet space has seen regional integration in the framework of the Commonwealth of Independent States (CIS). The CIS while moribund has affected migration in the post-Soviet space. Despite its persistence and effect on migration, few studies have sought to explore public perceptions towards the CIS. We address this limitation by developing several arguments, anchored on the literature on public opinion and European integration, to explain how perceptions towards migrants and employment status affect public trust in the CIS. Our analyses make use of the sixth wave of the World Values Survey that includes seven CIS member-states and finds strong support for our hypotheses. Our contribution lies in the investigation of public attitudes in a non-EU setting while applying arguments from EU literature and the wide coverage of our study compared to the extant literature on the CIS and public opinion.     

Budget deficits and interest rates in the United States

In this paper, an attempt has been made to reexamine the effect of budget deficits in the United States on interest rates. Unlike the previous studies which use only one definition of the dependent variable, we have used all three, namely, the nominal and the ex-post and the ex-ante real interest rate. Further, unlike previous studies, we considered both short-term and long-term interest rates. Our results provide absolutely no support for the proposition that federal deficits affect interest rates and thus contradict the recent findings by Cebula (1987) and Kolluri and Giannaros (1987). Finally, the paper provides some further support for the inverted Fisher hypothesis proposed by Carmichael and Stebbing (1983).Thanks are due to Zheng Wei for research assistance.     

State mortgage foreclosure policies and lender interventions: Impacts on borrower behavior in default

Due to the rise in foreclosure filings, policymakers are increasingly concerned with helping families in financial distress keep their homes. This paper tests the extent to which distressed mortgage borrowers benefit from three types of state foreclosure polices: (1) judicial foreclosure proceedings, (2) statutory rights of redemption, and (3) statewide foreclosure‐prevention initiatives. Based on an analysis of borrowers in default who reside in 22 cross‐state metropolitan statistical area pairs, state policies generally have weak effects. Both judicial foreclosure proceedings and foreclosure prevention initiatives are associated with modest increases in loan modification rates. Using a matching procedure, a lender's letter promoting mortgage default counseling was associated with increases in loan modifications, decreases in loan cures, and decreases in foreclosure starts. The effects of the letter were also stronger in states with judicial proceedings. © 2011 by the Association for Public Policy Analysis and Management.     

Trends in the economic status of the elderly, 1976-2000

The economic well-being of elderly Americans (aged 65 or older) improved between 1976 and 2000. Overall, poverty rates fell during this period, median real income rose, and median income relative to the working-age population was relatively stable. Most population subgroups shared in the reduced poverty rates; however, the economic status of elderly Hispanics did not improve. This article attempts to explain those economic trends by identifying changes in five sources of income for the elderly and analyzing the changes in the context of demographic changes in the elderly populations over the past 25 years. As a result of increased longevity, for example, larger proportions of elderly men and women are now 80 or older, and smaller proportions are 65 to 69. Hispanics and Asian Americans make up a larger share of the elderly population and whites a smaller share. The fraction of women who are married has increased, the fraction who are widowed has fallen, and the fraction who are divorced has grown. Such demographic changes can greatly affect the economic status of subgroups as well as the overall elderly population. Of the five sources of income for the elderly, Social Security remains the most prevalent and important. While both the rate of receipt and the share of aggregate income from Social Security benefits stayed relatively steady over the past 25 years, the average real Social Security benefit increased because of rising wages. Income from assets, the second most important source of income for the elderly, fluctuated. Because the elderly are more likely to hold interest-bearing assets such as bonds rather than stocks, their asset income is responsive to changes in nominal interest rates and bond yields. Receipt of pension income increased during this period, although it leveled off during the 1990s. Factors contributing to this pattern include enactment of the Employee Retirement Income Security Act of 1974, which increased protections of pension benefits for spouses, and improved labor market opportunities for blacks and women. In recent years, defined contribution pension plans have become more prevalent than defined benefit plans, but the full effect of this change on pension income may not yet be apparent. After decades of decline, labor force participation rates of older men leveled out in the mid-1980s and then increased. For older women, the trend before the mid-1980s was flat, but since then rates have risen substantially. The increased use of part-time jobs or self-employment to ease the transition into retirement, the economic expansion of the 1990s, and the liberalization of the Social Security earnings test may all have contributed to those trends. Although the percentage of elderly people with earnings has increased only modestly in the past few years, the share of income from earnings has grown substantially--from 16 percent of income in 1984 to 23 percent in 2000. Finally, Supplemental Security Income (SSI) benefits are indexed for inflation but not for growth in real wages. As real incomes of the elderly rose, therefore, fewer elderly persons were eligible to receive SSI or, for those receiving SSI, were eligible for smaller benefits. The proportion of elderly persons receiving public assistance, primarily SSI, declined from 11 percent in 1976 to 5 percent in 2000.     

Does India's growth matter? Evidence from the SAARC nations

The study estimates the extent of spillover effects that India's real per capita gross domestic product (GDP) growth rate has on the growth rates of other countries in the South Asian Association for Regional Cooperation (SAARC) region for the period 2003–2016. It also identifies whether the conventional trade channel is the means through which growth is transmitted from India to her neighboring countries. Using a random effects model, we conclude that on average, a 1 percentage point increase in India's real per capita GDP growth rate results in 0.46 percentage point increase in the per capita GDP growth rates of other SAARC nations. However, this does not occur through the trade channel primarily due to low levels of intraregional trade. Also, using time dummies, the paper analyzes whether there has been any significant change in the degree of spillover effects in the postfinancial crisis period, where countries have been observed to insulate themselves to a certain extent.     

Real Denial Rates: A New Tool to Look at Who Is Receiving Mortgage Credit

ABSTRACT

The observed mortgage denial rate (ODR), calculated from Home Mortgage Disclosure Act (HMDA) data, is often used to measure mortgage credit availability, but it does not account for shifts in applicants’ credit profiles. In this article, we develop an additional tool, which we call the real denial rate (RDR), as a way to account for credit differences and hence more consistently measure denial rates and mortgage credit accessibility. We match HMDA data with CoreLogic proprietary data to obtain both borrower demographic information (e.g., income and race and ethnicity) and mortgage credit characteristics (e.g., loan-to-value ratios, debt-to-income ratios, and credit scores). We account for shifts in applicants’ credit profiles by considering only the denial rate of low-credit-profile applicants. Our RDR results show that conventional mortgages have higher denial rates than government mortgages do, racial and ethnic differences are smaller than the ODR indicates but are not eliminated, and small-dollar mortgages have higher RDRs, particularly in the government loan channel.     

Keeping College Options Open: A Field Experiment to Help all High School Seniors Through the College Application Process

Recent research suggests that the college application process itself prevents access. This paper reports results from a school‐based experiment in which application assistance is incorporated into the high school curriculum for all graduating seniors at low‐transition schools. Over three workshops, students were guided to pick programs of interest that they were eligible for, apply for real, and complete the financial aid application. The goal was to create a real college option for exiting students to make the transition easier and more salient. Among all graduating seniors, the program increased application rates by 15 percentage points, and college going rates by 5 percentage points. Among those not taking advanced‐level courses, college enrollment increased by 9 percentage points. The program generated significant effects for a wide range of heterogeneous groups, including both males and females, those from urban and rural schools, and those with above and below average grades. While more intensive than other tested approaches, in‐class application assistance may provide a more effective approach for bridging the gap towards higher education.     

Some thoughts on the use and misuse of statistical inference

The abuse of techniques of statistical inference resulting from inadequate attention to the relationship between the model used and the real world problem being addressed, and inappropriate interpretation of conclusions in the light of that relationsip, are discussed. The basic principle underlying all statistical inference is that we attempt to distinguish between alternatives by comparing observed behavior with that predicted by predictive models of those alternatives. The use of predictive models which do not describe the behavior of the alternatives between which we wish to distinguish is a clear violation of that principle. The principle is illustrated in a discussion of sampling from an urn. The technique of causal inference through partial correlation analysis is discussed as an example of the violation of this principle. On the surface this technique appears to have wide applicability in analyses in support of policy studies, but further examination shows its applicability to be somewhere between highly questionable and totally specious.     

A General Pricing Model for a Mortgage Insurance Contract Considering the Effects of Multivariate Random Variables on Termination Probabilities and Loss Rate

This article describes the derivation of a general closed-form formula for determining a fair premium for both Federal Housing Administration (FHA) and private mortgage insurance (MI). Our model incorporates the regulations appearing in MI contracts, the changes in economic situations, the termination hazard rates (i.e., prepayment and default), and the loss rate given default. We then give an example to show how one uses our model to calculate an MI premium with FHA regulations by using real mortgage data. Our pricing formula can also be used to calculate the implied default hazard rates given the FHA's current MI. The comparison of this implied rate with the actual rate should help mortgage insurers decide whether the current MI premium should be adjusted. Further analysis shows how sensitive MI premiums are to changes in the model parameters, such as the volatility of the interest rate and the house price appreciation rate. Our pricing formula should make it easier for mortgage insurers to determine fair MI premiums and employ sophisticated risk-management procedures.     

The accumulation of lender-owned homes during the US mortgage crisis: examining metropolitan REO inventories

A key concern among policymakers and community developers in recent years has been the extent to which lender-owned homes, often called real estate owned or “REO” properties, accumulate in different local housing markets during the mortgage crisis. This paper describes the accumulation of REO properties in 356 metropolitan statistical areas (MSAs) from August 2006 to August 2008. It examines differences in both changes and static levels of REO activity across MSAs and compares changes in REO levels to changes in home values over the same period. Special attention is paid to 12 large MSAs with substantial levels of REO as of August 2008. A model of REO volume at the metropolitan level is estimated that includes differences in state foreclosure legal processes and timing among the independent variables. Finally, cluster analysis is used to identify a simple typology of MSAs based on REO levels and home price changes.     

The price of virtue

This article offers new evidence on the determinants of U.S. unwed birth rates from 1981 to 1990. We show that illegitimacy rates are positively and significantly correlated with payments under the Aid to Families with Dependent Children program over a period in which real AFDC payments declined. We attribute this result to a decline in the social sanctions for illegitimacy. Because social sanctions declined, so did the cost of deviance, as well as the price for which unwed women sold their virtue.     

Optimally Allocating Federal Money to Cities

The purpose of this article is to discuss some basic methods for optimally allocating federal money to cities. Optimally allocating in this context means using the quantitative methods of operations research, management science, and related fields in order to allocate federal money to cities in such a way as to (1) maximize benefits subject to a given budget, (2) minimize costs subject to a minimum satisfaction level, or (3) maximize benefits minus costs. The basic methods include (1) allocating by marginal rates of return, which partly relies or statistical regression analysis; and (2) allocating by part/whole percentages, which partly relies on ideas associated with multiattribute utility theory. The basic methods will be illustrated with the example of allocating anticrime dollars to cities, although one could easily reason by analogy to allocation in any subject matter area.