New estimates of U.S. currency abroad,the domestic money supply and the unreported economy

Despite financial innovations that have created important new substitutes for cash usage, per capita holdings of U.S. currency amount to $2950. Yet American households and businesses admit to holding only 15% of the currency stock, leaving the whereabouts of 85% unknown. Some fraction of this unaccounted for currency is held abroad (the dollarization hypothesis) and some is held domestically undeclared, as a store of value and a medium of exchange for transactions involving the production and distribution of illegal goods and services, and for transactions earning income that is not reported to the IRS (the unreported economy hypothesis). We find that the percentage of U.S. currency currently held overseas is between 30 and 37% rather than the widely cited figure of 65%. This finding is based on the official Federal Reserve/Bureau of Economic Analysis data which is a proxy measure of the New York Federal Reserve’s (NYB) “confidential” data on wholesale currency shipments abroad. We recommend that the NYB data be aggregated so as to circumvent confidentiality concerns, and be made readily available to all researchers in order to shed greater light on the questions of how much U.S. currency is abroad and on the particular location of overseas U.S. dollars. The newly revised official estimates of overseas currency holdings are employed to determine the Federal Reserve’s seigniorage earnings from 1964–2010, which have provided a $2950. Yet American households and businesses admit to holding only 15% of the currency stock, leaving the whereabouts of 85% unknown. Some fraction of this unaccounted for currency is held abroad (the dollarization hypothesis) and some is held domestically undeclared, as a store of value and a medium of exchange for transactions involving the production and distribution of illegal goods and services, and for transactions earning income that is not reported to the IRS (the unreported economy hypothesis). We find that the percentage of U.S. currency currently held overseas is between 30 and 37% rather than the widely cited figure of 65%. This finding is based on the official Federal Reserve/Bureau of Economic Analysis data which is a proxy measure of the New York Federal Reserve’s (NYB) “confidential” data on wholesale currency shipments abroad. We recommend that the NYB data be aggregated so as to circumvent confidentiality concerns, and be made readily available to all researchers in order to shed greater light on the questions of how much U.S. currency is abroad and on the particular location of overseas U.S. dollars. The newly revised official estimates of overseas currency holdings are employed to determine the Federal Reserve’s seigniorage earnings from 1964–2010, which have provided a 287 billion windfall for U.S. taxpayers. Overseas currency stock data are also used to derive estimates of the domestically held stock of currency as well as narrow and broad measures of domestic monetary aggregates. These domestic monetary aggregates are believed to be better predictors of future economic activity than traditional monetary aggregates and are tested to determine their ability to predict fluctuations in real output and prices. Domestic cash holdings are finally used to estimate the size of the U.S. unreported economy as measured by the amount of income that is not properly reported to the IRS. By 2010, we estimate that legal and illegal source unreported income” is $1.9–$1.9–2.4 trillion, implying a “tax gap” in the range of $400–$400–540 billion. Currently, we estimate that 18–23% of total reportable income is not properly reported to the IRS.     

Interaction orders of drug dealing spaces: local orders of sensemaking in a poor black American place

Based on ethnographic data, this essay analyzes the social order properties of a poor urban street, in a small city in the northeast United States, on which drug dealing is the principle occupation. Rather than treating drug dealing as an agent of disorder, we focus on the order properties of drug dealing and the ordered character of the local code of conduct that develops around it. Like Sudhir Venkatesh (American Journal of Sociology 103:82–111, 1997) we examine the interface between drug dealing and the neighborhood. However, in this small urban space the drug dealers are not outsiders, rather, they are long term residents: established insiders who are well integrated into community life. As such their work practices and the requirements they place on behavior in public spaces impact the neighborhood in comprehensive ways. We detail the phenomenon Elijah Anderson called the “code of the street” (Anderson 1999) as a set of practices and social markers, a local Interaction Order (Goffman, American Sociological Review 48:1–17, 1983; Rawls, Sociological Theory 2:136–149, 1987), that furnishes basic day to day sensemaking tools for residents (Rawls 2009). We propose that this order has a constitutive character that furnishes stable expectations (Garfinkel 1963, 1967) for meaningful social action and identity in the neighborhood. In a context of industrial decline and urban poverty, drug dealing careers constitute a major socialization factor, that touches everyone here—especially children.     

Aid, governance and corruption control: a critical assessment

If the OECD??s Development Co-operation Report for 2009 is correct in its claim that ??The international aid effort now adds up to less than the sum of its parts??, then continued rapid growth in aid transfers is likely to contribute to further aid absorption problems, as well as institutional atrophy and deteriorating governance and corruption control among aid recipients. This article considers aid for good governance and anti-corruption, using Tanzania as an example. ??The supply side of aid?? sketches the bigger picture in which such aid is located, stressing collective action problems facing the aid industry in the current period of growth and diversification. ??The consequences of aid proliferation on corruption control in an aid-dependent state?? provides some empirics from Tanzania. ??Conclusions: whither ??corruption control????? draws some conclusions for the future of aid for governance and corruption control. A key message is that donor-driven governance and corruption control initiatives have failed to address the governance weaknesses that excessive and uncoordinated aid has helped to create.     

Ready to leave the ivory tower?: Academic scientists’ appeal to work in the private sector

This study investigates the factors that shape the attitudes of scientists toward starting their own business or working in a private sector firm. The analysis is based on data collected from scientists working in the German Max Planck Society, a research institution devoted to basic science. We find that the scientists’ attractiveness of working in a private sector firm or of starting their own business differ considerably according to their academic discipline and the self-reported commercial potential of their research. The ability to take risks, prior work experience in private firms, and personal experience in cooperating with industry lead to a positive attitude towards switching to private sector employment or entrepreneurship. Strong willingness to freely distribute research findings is related to a low appeal of private sector work.     

A Criminological Approach to Explain Chronic Drunk Driving

The purpose of this paper is to use criminological theories to explain chronic drunk driving. There is little criminological research explaining recidivist drunk driving with criminological theories. Instead, most researchers posit that repeat drunk driving is explained as a byproduct of substance abuse. Although substance abuse is likely correlated to chronic drunk driving, theoretical explanations need to go further to understand a broader set of social and psychological predictors. Factor analysis and linear regression techniques are used to estimate the relationship between items from two assessment instruments with a number of drunken driving offenses. The sample consists of nearly 3,500 individuals on probation and parole in a Southwestern state. The findings support our contention that criminological frameworks are helpful to understand chronic DUI. We found significant results for volatility, antisocial friends, teenage deviance, and negative views of the law, while controlling for age, gender, marital status, and race. DUIs are a serious problem for the criminal justice system and understanding the individual level correlates of repetitive DUI is crucial for policy development. Further, chronic DUI offers criminologists an opportunity to determine the ability of criminological theories to explain this type of behavior.     

Do bone elasticity and postmortem interval affect forensic fractographic analyses?

Forensic fractographic features of bone reliably establish crack propagation in perimortem injuries. We investigated if similar fracture surface features characterize postmortem fractures. Experimentally induced peri- and postmortem fractures were used to assess if fractographic features vary as bone elasticity decreases during the postmortem interval (PMI). Thirty-seven unembalmed, defleshed human femoral shafts from males and females aged 33–81 years were fractured at varying PMIs with a drop test frame using a three-point bending setup and recorded with a high-speed camera. Vital statistics, cause of death, PMI length, temperature, humidity, collagen percentage, water loss, fracture energy, and fractography scores were recorded for each sample. Results showed that fractographic features associated with perimortem fractures were expressed in PMIs up to 40,600 accumulated degree hours (ADH), or 60 warm weather days. Hackle was the most consistently expressed feature, occurring in all fractures regardless of ADH. The most variable characteristics were wake features (78.4%) and arrest ridges (70.3%). Collagen percentage did not correlate strongly with ADH (r = −0.04, p = 0.81); however, there was a strong significant correlation between ADH and water loss (r = 0.74, p < 0.001). Multinomial logistic regression showed no association between fractographic feature expression and ADH or collagen percentage. In conclusion, forensic fractographic features reliably determine initiation and directionality of crack propagation in experimentally induced PMIs up to 40,600 ADH, demonstrating the utility of this method into the recent postmortem interval. This expression of reliable fractographic features throughout the early PMI intimates these characteristics may not be useful standalone features for discerning peri- versus postmortem fractures.