Understanding political risk in investment planning

In 1982, the Congress authorized $11 billion to modernize the nation's air traffic control system—one of the largest infrastructure investments since the building of the interstate highway system. Although this investment appears to offer a large and robust return, the economic results depend strongly on productivity gains through system consolidation. It is uncertain what balance the Congress will strike between the long-term, widely shared benefits of greater productivity and the immediate job losses from system consolidation. This risk can be included in the calculus of expected return through Monte Carlo analysis. When this is done, the expected return drops very close to the 10% hurdle rate that the government often uses for such projects. This method of integrating political risk can be applied to any investment, public or private, for which political action joins the customary economic and technical uncertainties in affecting the outcome.     

Fatal bromethalin poisoning

Bromethalin is a neurotoxin found in some rodenticides. A delusional 21-year-old male presented to a hospital with altered mental status the day after ingesting a bromethalin-based rodenticide. He died 7 days after his self-reported exposure to c. 17 mg bromethalin (equivalent to 0.33 mg bromethalin/kg). His clinicopathologic course was characterized by altered mental status, obtundation, increased cerebrospinal fluid pressure, cerebral edema, death, and diffuse histologic vacuolization of the white matter in the central nervous system seen on microscopic examination at autopsy. The presence of a demethylated form of bromethalin in the patient's liver and brain was confirmed by gas chromatography with mass spectrometry. Clinical signs and lesions observed in this patient are similar to those seen in animals poisoned with bromethalin. This case illustrates the potential for bromethalin ingestion to result in fatal human poisoning.     

Incremental Thinking: "Toward a Theory of Budgeting"

Editor's Note: V.O. Key's article bemoaning "The Lack of a Budgetary Theory" was reprinted in the previous issue of Public Budgeting & Finance. The problems identified by Key are normative; they go to the basic values arid purposes of society and, hence, cannot be resolved by budgetary solutions alone. But a dozen years after Key wrote, Verne Lewis sought to anchor a theory of budgeting in marginal analysis, His article, printed here by permission of the American Society for Public Administration, first appeared in the Public Administration Review in 1952, Rather than seeking a full-blown political philosophy. Lewis thought that budgetary choice could be rationalized at the margins, by comparing the marginal costs and benefits of competing claims on public resources, While his hopes for a theory of budgeting have not been fulfilled, Lewis laid the groundwork for forms of marginal analysis introduced by PPB and ZBB in later decades. Indeed, there is a remarkable affinity between the budgetary structure proposed by Lewis and the one used by zero-base budgeting in the 1970s.     

He sends rain upon the wicked: a panel study of the influence of religiosity on violent victimization

This research investigates low religiosity as a predictor of violent victimization. The theoretical framework the authors present here posits that religiosity should help structure daily activities in such a way as to (a) limit exposure to offenders by encouraging contact with peers who are less deviant, (b) lessen one's target suitability by inhibiting grievance-causing delinquent activity, and (c) enhance guardianship by fostering stronger bonds with parents and school. Thus, although researchers expect religion to be a bivariate predictor of violent victimization, its influence should be indirect. The authors investigate these claims using two waves from the public-use version of the National Longitudinal Study of Adolescent Health (Add Health). The results indicate that religiosity is a correlate of violent victimization. Consistent with these theoretical claims, the effect of religiosity is not direct, but instead occurs indirectly primarily through its influence on self-reported delinquency and peer deviance.