Theoretical and Applied Issues Edited by Andrew Ortony Jon Slack OlivieroStock NATO ASI Series Series F: Computer and Systems Sciences, Vol. 100 Communication from an Artificial Intelligence Perspective NATO ASI Series Advanced ...
This paper presents two projects concerned with the application of natural language processing technology for improving communication between Public Administration and citizens. The first project, GIST,is concerned with automatic multilingual generation of instructional texts for form-filling. The second project, TAMIC, aims at providing an interface for interactive access to information, centered on natural language processing and supposed to be used by the clerk but with the active participation of the citizen.
This paper concerns the familiar topic of whether we can have genuinely emotional responses such as pity and fear to characters and situations we believe to be fictional1. As is well known, Kendall Walton responds in the negative (Walton (1978); (1990): 195-204 and Chapter 7; (1997)). That is, he is an ‘irrealist’ about emotional responses to fiction (the term is Gaut’s (2003): 15), arguing that such responses should be construed as quasiemotions (Walton (1990): 245), of which their possessor imagines that (...) they are genuine emotions. This is not to deny that an experience in response to a fiction may have a phenomenology very like a given emotion, but to insist that, nonetheless, such responses are not real instances of the emotions which they resemble (Walton (1997)). So, in his most famous example, Charles, who experiences fear-like emotion in relation to a film which depicts the approach of evil slime, does not, despite appearances, experience genuine fear towards the slime, but only quasi-fear (Walton (1990): 195-204)2. Walton’s view presupposes the following view about the nature of emotion3. (shrink)
Recently, philosophers have identified certain fictional propositions with which one does not imaginatively engage, even where one is transparently intended by their authors to do so. One approach to explaining this categorizes it as 'resistance', that is, as deliberate failure to imagine that the relevant propositions are true; the phenomenon has become generally known (misleadingly) as 'the puzzle of imaginative resistance'. I argue that this identification is incorrect, and I dismiss several other explanations. I then propose a better one, that (...) in central cases of imaginative failure, the basis for the failure is the contingent incomprehensibility of the relevant propositions. Why the phenomenon is especially commonplace with respect to moral propositions is illuminated along the way. (shrink)
In his article ‘ Fantasy, Imagination and the Screen ’ , Roger Scruton offers an account of fantasy, arguing that it is directed away from reality in some important sense, and that cinema is its natural representational medium. I address certain problems with Scruton’s basic account, thereby producing a signifi cantly amended version, though one that owes a great debt to his. I explain why, as he says, much fantasy is signifi cantly directed away from reality; and conclude with some (...) brief remarks about.. (shrink)
Leading young scholars present a collection of wide-ranging essays covering central problems in meta-aesthetics and aesthetic issues in the philosophy of mind, as well as offering analyses of key aesthetic concepts, new perspectives on the history of aesthetics, and specialized treatment of individual art forms.
The issues tackled in this volume include what sort of thing a work of music is; the nature of the relation between a musical work and versions of it; the ...
This book collects new studies of the work of F. H. Bradley, a leading British philosopher of the late nineteenth and early twentieth century, and one of the key figures in the emergence of Anglo-American analytic philosophy. Well-known contributors from Britain, North America, and Australia focus on Bradley's views on truth, knowledge, and reality. These essays contribute to the current re-evaluation of Bradley, showing that his work not only was crucial to the development of twentieth-century philosophy, but illuminates contemporary debates (...) in metaphysics, logic, and epistemology. (shrink)
A popular approach to defining fictive utterance says that, necessarily, it is intended to produce imagining. I shall argue that this is not falsified by the fact that some fictive utterances are intended to be believed, or are non-accidentally true. That this is so becomes apparent given a proper understanding of the relation of what one imagines to one's belief set. In light of this understanding, I shall then argue that being intended to produce imagining is sufficient for fictive utterance (...) as well. (shrink)
A half-billion years ago, a few species of single-celled protozoa stumbled irreversibly from loose social interaction into a tight, specialized interdependence. They became multi-celled metazoa, and human beings are one sort. Metazoa greatly transcend their constituent cells in lifetime, abilities, experiences and even materials (like bone). New kind of beings emerged out of the interactions of the old.
In Art as Performance , David Davies identifies certain properties relevant to artistic appreciation of artworks that, he suggests, are naturally construed as belonging to the artist’s creative performance rather than to any product of that performance (the “work-product”). He further argues, against an anticipated opponent, that such properties cannot be excluded as irrelevant to artistic appreciation in any principled way. I argue that the cited properties can be intelligibly construed as properties of the associated work-product, whether or not they (...) are relevant to artistic appreciation; but that some are not relevant to artistic appreciation. In doing so, I offer a principle determining when a property of an artwork is relevant to artistic appreciation. I conclude that, on its own, Davies’s argument offers no good grounds to abandon our practice of thinking of the artwork as the product of an artist’s activity, rather than the activity itself. (shrink)
The claim that the functions of art liable to change over time appears to suggest that any attempt to define art in terms of a limited set of functions will fail. Robert Stecker has offered a functionalist definition which seeks to accommodate this criticism by making the functions which are relevant to an artwork's status those which are 'standard or correctly recognized' for some art form. I argue that Stecker does not offer a clear enough distinction between the 'standard or (...) correctly recognized' and the accidental functions of an art form; that his account of the 'standard or correctly recognized' functions of an art form does not exhaust important artistic functions; and that his proposed definition is neither necessary nor sufficient for an object to count as an artwork. For these reasons I suggest that Stecker's functionalist account of art should be rejected. (shrink)
This collection of specially written papers on F. H. Bradley's philosophy makes accessible the writings of one of England's greatest philosophers. The contributors, finding in Bradley's writings arguments that extend topics currently at the forefront of philosophical thought, aim to show the relevance of Bradley's work to contemporary issues in logic, metaphysics, and moral and political philosophy.
The epimeleia tês psyches, that is, the formation and purification of the soul, is an important topic in Ancient Philosophy. As the soul is immaterial it can be difficult to understand what is meant by the idea of a formation of the soul. Many philosophers in Antiquity try to explain the meaning of the formation of the soul by using linguistic imagery, that is, similes, metaphors and myths. In this paper some of these images, in particular, the images of the (...) painter and sculptor of the soul, are presented and analysed. The function of these linguistic forms in the logic of the text and the conceptual differences between the image of the painter and the image of the sculptor are discussed. (shrink)
In this paper I examine the frequently made claim that grasping a metaphor is a kind of ‘seeing-as’. I describe several ways in which it might be thought that metaphor-grasping is importantly similar to seeing-as, such that an extension of the latter category is though justified to include the former. For some of these similarities, I suggest they are illusory; for others, I argue that they are shared in virtue of the membership of both seeing-as and metaphor-grasping in some much (...) broader category, and so don’t obviously motivate thinking of metaphor-grasping as seeing-as. My aim is modest: not to deny that metaphor-grasping is a kind of seeing-as, but only to suggest that it should not be too quickly accepted. (shrink)
Thomas S. Kuhns Variante einer Theorie der Wissenschaftsgeschichte hat in einem Werk Ludwig Flecks (von 1935) einen wichtigen Vorläufer. Durch die Frage, wie es komme, daß die Flecksche Theorie seinerzeit nicht so bekannt wurde wie die Kuhnsche Bearbeitung etwa dreißig Jahre später, stellt sich das Problem der wissenschaftlichen Beachtung. Eine Theorie der wissenschaftlichen Beachtung muß zwei Dimensionen "thematischer Rahmen" und "wissenschaftliche Theorie" unterscheiden. Beachtung gefunden werden kann nur, wenn ein bestimmter Text sich innerhalb eines etablierten thematischen Rahmens befindet und wenn (...) die darin vertretene Theorie in Widerspruch zu Grundgesetzen etablierter Theorien steht. (shrink)
Wie entsteht eine Wahrnehmung? Wir betrachten einen derzeit nahezu vergessenen philosophischen wie psychologischen Ansatz, der eine solche Theorie entwickelte. Die Vorgeschichte dieser Theorie beginnt bei Alexius Meinongs Relationstheorie (1882) und dessen frühen Bemühungen zur Psychologie. Christian von Ehrenfels, aufbauend auf Meinongs Vorarbeiten sowie Ernst Machs Analyse der Empfindungen von 1886, gibt der Theoriegenese 1890 durch seine Arbeit über Gestaltqualitäten starken Auftrieb. Die Grazer Schule übernimmt das Thema unter dem Aspekt: Sind Gestalten als Ganzes erfaßbar, oder werden sie auf der Basis (...) elementarer Empfindungen erst durch einen psychischen Akt produziert? Anhand der geometrisch-optischen Täuschungen gehen zunächst Stephan Witasek und später Vittorio Benussi dieser Frage ab 1894 auch experimentell nach. Zunächst kann ausgeschlossen werden, daß solche Täuschungen Urteilstäuschungen sind, daß sie also Vorstellungstäuschungen sein müssen. Als wichtig für die psychologische Theorie der Vorstellungsproduküon erweist sich Meinongs philosophische Konzeption der Gegenstände höherer Ordnung. Rudolf Ameseder legt 1904 eine gegenstandstheoretische Skizze der Produktionstheorie vor. Benussi zeigt ebenfalls 1904 wiederum am Beispiel der optischen Täuschungen, daß diese keine Empfindungstäuschungen sind (was Witasek angenommen hatte), sondern Produktionstäuschungen. Damit ist experimentell belegt, daß es psychische Produktionen gibt. (shrink)
Brian Stock (1980). In Search of Eriugena's Augustine. In Werner Beierwaltes (ed.), Eriugena: Studien Zu Seinen Quellen: Vorträge des Iii. Internationalen Eriugena-Colloquiums, Freiburg Im Breisgau, 27.-30. August 1979. C. Winter.score: 30.0
A intenção deste artigo é primàriamente exegética. Não pretende chegar a conclusães filosóficas substanciais nem fazer uma apreciação crítica. Pretende simplesmente esclarecer a versão de Russell quanto ao atomismo lógico, apresentando a sua teoria do juízo empírico num contexto histórico. A maior parte dos comentários contemporâneos falham neste ponto; contudo, afigura-se impossível compreender perfeitamente a teoria de Russell aeerca do conhecimento, bem como a Teoria das Descrições, como parte integrante daquela teoria, se não for encarada como uma tentativa para evitar (...) as consequencias de certas teorias alternativas do juízo. Pensa o autor que muitas críticas contemporâneas da Teoria das Descrições estão deslocadas, simplesmente por não conseguirem apreender o papel que aquela teoria devia desempenhar na análise russelliana do juízo empírico. A título de exemplo tenta o autor mostrar como as críticas de P. F. Strawson a respeito da Teoria das Descrições, como foram formuladas no seu artigo On Referring, não vêm a propósito (cf. Secção VT). A principal comparação histórica aqui apresentada refere-se à teoria idealista do juízo de F. H. Bradley. Contudo, parece também importante salientar o acordo que existe entre Russell e Bradley quanto a rejeitar como inadequado o tipo de análise do juízo apresentado por Leibniz e, numa primeira etapa da sua carreira, por G. E. Moore. Leibniz e Moore apresentaram, em moldes diversos, aquilo a que podíamos chamar teorias 'essencialmente genéricas' do juízo. Para Leibniz uma proposição é uma conexão analitica de conceitos, para Moore uma proposição é uma conexão sintética de conceitos. Tanto Russell como Bradley afirmam que é impossível formular uma teoria do juízo satisfatória, se concebermos a relação entre uma mente e uma proposição, implicada no juízo, como uma simples conexao de conceitos. O juízo deve ser apresentado como algo que implica experiência imediata pré-conceitual, experiência essa que, embora em si mesma não seja capaz de verdade ou falsidade, está pressuposta na própria possibilidade de qualquer juízo, verdadeiro ou falso, acerca da realidade. Dum modo geral, podíamos dizer que um juízo, cujo conteúdo é conceitual, é em virtude da experiência imediata que 'atinge a realidade' ('reaches right up to reality'). Contudo, embora Russell e Bradley concordem neste ponto, a análise da experiência imediata apresentada pelo primeiro é muito diferente da do segundo. Na medida em que se pode falar duma tese exegética positiva neste artigo, dir-se-ia que a análise russelliana da experiência imediata, contida na sua doutrina do 'conhecimento por experiência directa' dos particulares na sensação, é formulada especificamente (a) para ser compatível com a existência dum universo pluralista de particulares externamente relacionados e (b) para permitir uma versão da teoria de correspondência da verdade. Por outras palavras, a análise russelliana do juízo empírico, implicando necessàriamente um 'conhecimento por experiência directa' dos particulares na sensação, foi formulada especìficamente para evitar as consequências que, tanto Bradley como Russell, viram seeguir-se da análise idealista do juízo. Isto ilustra uma diferença fundamental entre o método filosófico de Russell e o de Bradley. Bradley aceita o monismo, a irrealidade das relações externas, e a teoria de coerência da verdade como consequência da sua teoria inicial do juízo. Russell, por outro lado, pensa que estas consequências se tornaram inaceitáveis perante a prática e as descobertas da ciência empírica; e tenta, por isso, construir uma teoria do juízo compatível com o tipo de metafísica e com a teoria da verdade, que lhe parece serem exigidos pela ciência empírica. (Resumo do Autor. Trad. A. M.). (shrink)
Die Reihe formaler Sprachen, die im Verständnis von M.J. Cresswell "sinnvoll" als Modelle für natüriiche Sprachen anzusehen sind und die dabei auch semantische Vagheiten zu erfassen gestatten, nämlich die dreiwertige Logik (U. Blau), die Superbewertung (B.C. van Fraassen, K. Fine, M. Pinkal, J. Ballweg) und die unscharfe Logik (L.A. Zadeh), legt nahe, daß bei der Sprachanalyse Zadehs "Prinzip der Inkompatibilität" gilt: Hohe Präzision ist inkompatibel mit hoher Komplexität. Je komplexer man das Vagheitsproblem angeht, desto verschwommener wird der benutzbare Geltungswert. Zudem (...) wird die Sprachanalyse auf Empirie verwiesen: Die Superbewertung erfordert eine Beschreibung von Kontexten, die unscharfe Logik eine sprachempirische Untersuchung aller Geltungswerte. (shrink)
Islamic banking, based on the prohibition of interest, is well established throughout the Muslim world. Attention has now turned towards applying Islamic principles in equity markets. The search for alternatives to Western style markets has been given added impetus in Muslim countries by the turmoil in Asian financial markets in 1997. Common stocks are a legitimate form of instrument in Islam, but many of the practices associated with stock trading are not. In this paper the instruments traded and the (...) structure and practices of stock markets are examined from an Islamic perspective. Speculation is not acceptable in Islam and measures would have to be taken to control speculative trading. In addition short selling and margin trading are severely restricted. The use of stock index and equity futures and options are also unlikely to be acceptable within an Islamic market. Regulatory authorities in Muslim countries will therefore find a vast array of problems in attempting to structure a trading system that will be acceptable. (shrink)
The cognitive developmental theory of ethics suggests that there is a positive relationship between ethical reasoning and ethical behavior. In this study, we trained a sample of accounting and finance students in performing competitive stock trading in our state-of-the-art trading room. The subjects then performed trading of stocks under two experimental conditions: insider information, and no-insider information where significant performance-based financial awards were at stake. We also administered the Defining Issues Test (DIT). Ethical behavior, as the dependent variable was (...) measured in a binary scale: whether the subjects used insider information for trading of stocks or not. Ethical reasoning as measured by the DIT P-score indicated statistically significant effect on ethical behavior. The results have important implications for recruitment and training of professionals engaged in the use of financial markets for securities trading. (shrink)
Backdating of stock options is an example of an agency problem. It has emerged despite all the measures (i.e., new regulations and additional corporate governance mechanisms) aimed at addressing such problems? Beyond such negative controlling measures, a more positive empowering approach based on ethics may also be necessary. What ethical measures need to be taken to address the agency problem? What values and norms should guide the board of directors in protecting the shareholders' interests? To examine these issues, we (...) first discuss the role values and norms can play with respect to underlying corporate governance and the proper role of directors, such as transparency, accountability, integrity (which is reflected in proper mechanisms of checks and balances), and public responsibility. Second, we discuss various stakeholder approaches (e.g., government, directors, managers, and shareholders) by which conflicts of interest (i.e., the agency problem) can be addressed. Third, we assess the practice of backdating stock options, as an illustration of the agency problem, in terms of whether the practice is legally acceptable or ethically justifiable. Fourth, we proceed to an analysis of good corporate governance practice involving backdating options based on a series of ethical standards including: (1) trustworthiness; (2) utilitarianism; (3) justice; and (4) Kantianism. We conclude that while executive compensation schemes (e. g., stock options) were originally intended to help remedy the agency problem by tying together the interests of the executives and shareholders, these schemes may have actually become "part of the problem," and that the solution ultimately depends upon whether directors and executives accept that all of their actions must be based on a set of core ethical values. (shrink)
This paper examines the ethics of contemporary managerial compensation in the context of executive stock options. Economic considerations would dictate that executive stock options should be adjusted to eliminate the effect of overall stock market movements which are beyond the control of the executive. However, in practice, most executive stock options are not adjusted to control for these outside factors. Agency considerations are the most likely culprit. Adjusting for the influence of outside factors, such as a (...) generally rising stock market, from executive stock options sets a higher bar for managers to reach. Furthermore, traditional accounting standards permitted firms that did not adjust options to avoid reporting options as expenses. This presents CEOs and boards of directors with a major ethical dilemma. On the one hand, their duty to their shareholders and stakeholders dictates that executive stock options should be adjusted to eliminate outside noise from unrelated movements in the overall stock market. However, financial statements are presented in the language of accounting. If the overwhelming majority of the users of a language define a particular item in one way, then to deviate from the norm implies that the recipient of such a deviant statement may not properly interpret the statement. Likewise, if the standard practice is for firms to use unadjusted options and thus under-report expenses, to deviate from this industry norm risks that users of financial statements would not properly interpret the financial statements, with perhaps negative consequences for the shareholders. In short, if "everyone else does it," then it could be wrong for an individual firm to deviate from the norm as that would harm the shareholders. (shrink)
In Anti-Oedipus, Deleuze and Guattari claim that a general theory of society must be a generalised theory of flows. This is hardly a straightforward claim, and this paper attempts to examine the grounds for it. Why should socio-political theory be based on a theory of flows rather than, say, a theory of the social contract, or a theory of the State, or the questions of legitimation or revolution, or numerous other possible candidates? The concept of flow (and the related notions (...) of code and stock), I argue, is derived from contemporary economic theory, and most notably John Maynard Keynes. Deleuze and Guattari remained Marxists, not only because they held that contemporary political philosophy must inevitably be centred on the analysis of capitalism, but also because they held, following Marx himself, that the Marxist analysis of capital must constantly be transformed and adapted to new conditions. Thus, while certain aspects of Marx's analysis disappear from Capitalism and Schizophrenia, they are supplemented by the addition of new concepts adequate to the contemporary state of capitalism. The paper concludes, then, with an analysis of the role played by the concepts of flow, code and stock in Deleuze and Guattari's political philosophy. (shrink)
This book is for those interested in an extensive review of the field of bioethics. It is for philosophers who wish to understand the core conceptual issues in health care ethics, and for bioethicists who wish to better understand classical problems in philosophy that have a bearing on health care ethics. The Handbook of Bioethics: Taking Stock of the Field from a Philosophical Perspective: -presents a comprehensive survey of bioethics in one volume; -has 27 of the most prominent scholars (...) in the field take stock of the issues they helped define; -contains essays that outline areas where future research is needed; -identifies potential areas for fruitful collaboration between traditional philosophers and bioethicists; -is an ideal text for graduate or upper level undergraduate courses. (shrink)
This article is divided into two parts: in the first we explore the academic debate conducted at an international level about insider trading (IT). In particular, we exame IT on three grounds: economic, ethical and legal. In each section we present the arguments in favour of and against IT and then we give our personal opinion. In the second part we present the situation in the Athens Stock Exchange. We examine its past record on the issue of IT and (...) recent developments, and comment on the implications for the future. (shrink)
The stock market’s reaction to information disclosure of environmental violation events (EVEs) is investigated multi-dimensionally for Chinese listed companies, including variables such as pollution types, information disclosure sources, information disclosure levels, modernization levels of the region where the company locates, ultimate ownership of the company, and ownership held by the largest shareholder. Using the method of event study, daily abnormal return (AR) and accumulative abnormal return (CAR) are calculated under different event window for examining the extent to which the (...)stock market responds to the EVEs. Furthermore, statistical significance of the difference in stock market reaction is compared between event firms with different characteristics. The relationship between CAR and its impact factors is examined by multivariate analysis. The findings reveal that the average reduction in market value is estimated to be much lower than the estimated changes in market value for similar events in other countries, demonstrating that the negative environmental events of Chinese listed companies currently have weak impact on the stock market. (shrink)
This study adds to the empirical evidence supporting a significant connection between ethics and profitability by examining the connection between published reports of unethical behaviour by publicly traded U.S. and multinational firms and the performance of their stock. Using reports of unethical behaviour published in the Wall Street Journal from 1989 to 1993, the analysis shows that the actual stock performance for those companies was lower than the expected market adjusted returns. Unethical conduct by firms which is discovered (...) and publicized does impact on the shareholders by lowering the value of their stock for an appreciable period of time. Whatever their views on whether ethical behaviour is profitable, managers should be able to see a definite connection between unethical behaviour and the worth of their firm's stock. Stockholders, the press and regulators should find this information important in pressing for greater corporate and managerial accountability. (shrink)
Collectively, institutions own an increasing proportion of outstanding corporate equities. As an emergent force in shaping corporate America, the linkages between institutional ownership and corporate social performance (CSP) require empirical examination. Not only do corporate policy makers need to know those areas where social performance may lure or inhibit capital infusions, lawmakers also need a better understanding of the social forces guiding corporate policy. As anticipated, this study found a positive relationship between the amount of institutional ownership of corporate (...) class='Hi'>stock and a company's social responsiveness as measured by the representation of women on its board of directors; however, no statistically significant relationship with social responsibility as measured by charitable giving was found. The exemplar of social issues management — compliance with the Sullivan principles — showed an unexpected, negative relationship with the level of institutional ownership. (shrink)
As far as we are aware, this study presents the first comparative analysis of the stock picking and market timing abilities of managers of conventional and socially responsible (SR) pension funds, and of their use of superior information. For the United Kingdom, the results obtained show a slight stock picking ability on the part of SR pension fund managers (although it disappears if multifactorial models are considered), and a negative market timing ability on the part of both SR (...) and conventional pension fund managers (these results hold for multifactorial models controlled by home bias). In relation to the management styles, both conventional and SR pension funds usually invest in small cap and growth values, although it is the SR pension funds that are the most exposed to these styles. We also observed that, while conventional pension fund managers make certain use of superior information to follow stock picking strategies, managers of SR pension funds use superior information to follow market timing strategies. (shrink)
Recent scandals at Enron, WorldCom and Global Crossing have put the ethical spotlight on corporate malfeasance as never before. However, these are the situations in which management knew that they made the wrong choice. As professor Joseph Badaracco of Harvard Business School points out, the real ethical dilemmas arise when people must choose between right and right — where both choices can be justified, yet one must be chosen over the other. Whether or not to reprice stock options represents (...) one such ethical dilemma. Repricing can help exodus of talented employees and motivate them to improve firm performance. However, it alienates shareholders and other workers of the company who are left unprotected from the adverse economic consequences of a stock price decline.In this paper we examine the ethics and the economics of stock option repricing. We find that repricing runs counter to two key tenets of business ethics — distributive justice and ordinary decency. To examine the economics of repricing, we draw upon agency theory to identify situations where repricing has the potential to benefit shareholders. However, a survey of empirical research reveals that these benefits do not translate into reality. Repricing does not improve employee retention or firm performance. In addition, managers benefit by opportunistically timing the repricing. Due to weaknesses in corporate governance such as lack of independence and conflicts of interest, the current repricing practice seems to be at odds with the objective of shareholder wealth maximization, and at a more fundamental level, a violation of board's fiduciary duty to shareholders. We offer suggestions that mitigate the ethically undesirable effects of repricing in the wider context of prevailing corporate governance and regulatory environment. We believe that these suggestions, if properly implemented, can transform repricing from a greed-inspired evil to a valuable compensation tool to retain employees, boost their morale, and enhance stockholder wealth. (shrink)
Recent changes to accounting standards for employee stock-based compensation with contingent features are examined. The implementation of FAS 123R by the Financial Accounting Standards Board in December 2005 now requires the fair value of such expenses to be recorded in net income. This accounting change is now impacting the reported financial statements of firms that have been substantial users of employee stock options. This provides an opportunity to directly observe the actual impact FAS 123R is having on such (...) firms. Arguments for and against mandatory expensing are reviewed and an assessment of the contrasting positions provided. Significant limitations of current reporting requirements for executive stock options identified in Poitras (2004) still have not been addressed. (shrink)
This paper addresses the impact of the unethical business conduct of a few individuals that shook the financial market in 1986. Specifically, in the study undertaken for this paper, the wealth status of the shareholders of securities firms was examined in relation to the public disclosure of the insider-trading scandals involving Dennis Levine, Ivan Boesky, and their confederates. It was hypothesized that the expected market-adjusted stock returns for the securities firms would be negative as a result of the scandals. (...) The findings of the study supported the hypothesis. (shrink)
This research examines whether having a readily available code of ethics on a corporation's website associates with either their auditor or stock exchange listing. As such, it is the first research that studies the association among readily available codes of ethics, client auditor and stock exchange listing on a longitudinal basis. In our data gathering, we went to the website of each corporation and searched for a readily available disclosure of its code of ethics at the beginning of (...) April 2006 through April 2009 – third-through-sixth anniversaries of the Sarbanes–Oxley Act. Our data indicate that the average readily available rate of codes of ethics for Ernst and Young's clients was significantly lower than the average readily available rate for the clients of Deloitte and Touche in 2006 and 2007 and PricewaterhouseCoopers in 2007. However, our data indicate no differences among the Big Four firms in 2008 and 2009. Our data indicate that the average readily available rates for the clients listed on the New York Stock Exchange (NYSE) were significantly higher than for clients that were not listed on the NYSE for all four observation points (2006–2009). (shrink)
Extending the work of Davidson and Worrell (1988), we further investigate the stock market''s reaction to announced corporate illegalities. We examine a sample of 535 announcements of corporate crime and obtain an overall insignificant stock market reaction. However, when the sample is divided by type of crime, we find that the stock market reacts significantly to announcements of bribery, tax evasion, and violations of government contracts. We also find a significantly negative reaction to announcements of corporate (...) crime when the company had been previously accused of other illegal activity. For companies accused of crime in the 1970s, 51% of them were accused again in the 1980s. (shrink)
The increased scrutiny of investors regarding the non-financial aspects of corporate performance has placed portfolio managers in the position of having to weigh the benefits of ' holding the market' against the cost of having positions in companies that are subsequently found to have questionable business practices. The availability of stock indexes based on sustainability screening makes increasingly viable for institutional investors the transition to a portfolio based on a Socially Responsible Investment (SRI) benchmark at relatively low cost. The (...) increasing share of socially responsible investments may play a role in providing incentives towards a continuous upgrading of sustainability standards to the extent that their performance is not systematically inferior to that of the other funds. This article examines whether these incentives have been so far detectable with particular reference to the Dow Jones Sustainability Stoxx Index (DJSSI) that focuses on the European corporations with the highest CSR scores among those included in the Dow Jones Stoxx 600 Index. The aim of the article is twofold. First, we analyse the performance of the DJSSI over the period 2001-2006 compared to that of the Surrogate Complementary Index (SCI), a new benchmark that includes only the components of the DJ Stoxx 600 that do not belong to the ethical index to evaluate more correctly the size of possible divergent performances. Second, we perform an event study on the same data set to analyse whether the stock market evaluation reacts to the inclusion (deletion) in the DJSSI. In both cases, the results suggest that the evaluation of the CSR performance of a firm is a significant criterion for asset allocation activities. (shrink)
Speculative bubbles present a problem for the development of sophisticated financial markets in developing economies. This paper discusses the evolution of regulatory institutions in Pakistan pertaining to the Karachi stock exchange and empirically tests for the presence of stock market bubbles in that stock market in recent years. A fundamental is estimated using a VAR approach, and residuals of this fundamental are tested for trends using Hamilton regime switching and Hurst rescaled range methods. Nonlinearities beyond ARCH are (...) also tested for using the BDS test. We are unable to reject the hypothesis of no bubbles or non nonlinearities during the period studied, indicating that Pakistan faces this difficult problem in developing appropriate regulations and institutions for the oversight of its financial markets. (shrink)
Prior research has examined several ethical questions related to executive compensation. The issues that have received most attention are whether executives' pay is fair and justified by performance. Since more recent studies show that stock options grants constitute the single largest component in executive compensation, we examine the relations of these grants to economic determinants and corporate governance for firms in the stagnant stage of their lifecycle. We find that, on average, stock options grants comprise a significant portion (...) of annual CEO compensation (26.4%) for stagnant firms. We also find that economic (corporate governance) factors explain less (or more) of the cross-sectional variation in stock options grants for stagnant firms than for growth firms. Furthermore, we document lower pay-performance sensitivity (i.e., weaker incentive alignment) and no improvement in future firm performance from past stock options grants to CEOs of stagnant firms. In particular, our study provides empirical evidence on some inefficiencies associated with stock options grants to CEOs of low potential (stagnant) firms, a long-standing concern of business ethics researchers (Moriarty, 2005; Nichols and Subramaniam, 2001; Perel, 2003). Our results also provide support for the corporate governance reforms discussed in Matsumura and Shin (2005), especially those proposed provisions that curtail the power of CEOs in the governance of firms. (shrink)
Textbooks increasingly reflect changes in our sociological stock of knowledge about the founders of the discipline. Richard Hamilton is unaware of this research and its documentation of the flaws in earlier accounts of the history of the profession. In an effort to expand his disciplinary understanding, I briefly review the extensive scholarship on the sociology of Harriet Martineau which has been published over the last quarter of a century.
This work presents a specific stock-effort dynamical model. The stocks correspond to two populations of fish moving and growing between two fishery zones. They are harvested by two different fleets. The effort represents the number of fishing boats of the two fleets that operate in the two fishing zones. The bioeconomical model is a set of four ODE's governing the fishing efforts and the stocks in the two fishing areas. Furthermore, the migration of the fish between the two patches (...) is assumed to be faster than the growth of the harvested stock. The displacement of the fleets is also faster than the variation in the number of fishing boats resulting from the investment of the fishing income. So, there are two time scales: a fast one corresponding to the migration between the two patches, and a slow time scale corresponding to growth. We use aggregation methods that allow us to reduce the dimension of the model and to obtain an aggregated model for the total fishing effort and fish stock of the two fishing zones. The mathematical analysis of the model is shown. Under some conditions, we obtain a stable equilibrium, which is a desired situation, as it leads to a sustainable harvesting equilibrium, keeping the stock at exploitable densities. (shrink)
Daily returns of stock markets in 27 emerging markets in Asia, Africa, South America, and Eastern Europe from the early 1990s through 2006 are analyzed for the possible presence of nonlinear speculative bubbles. The absence of these is tested for by studying residuals of VAR-based fundamentals, using the Hamilton regime-switching model and the rescaled range analysis of Hurst. For the first test absence of bubbles is rejected for 24 countries (except Mexico, Sri Lanka, and Taiwan), and for the second (...) it is rejected for 26 (except Malaysia). BDS testing on residuals after ARCH effects are removed fails to reject further nonlinearity in the residual series for all countries. (shrink)
This paper studies the relationship between personal stock donation by top executives and board of directors (insiders) of publicly traded corporations and their personal tax, shareholders' returns, and social responsibility. The study finds evidence that the timing of stock donations is driven by personal tax gain. The study further shows, comparing stock gift corporations relative to their non-stock gift cohorts, that personal stock gifts are associated with lower short-term and long-term stock returns to shareholders. (...) This implies that stock donation driven by insiders' personal gain adversely affects shareholder wealth. However, the likelihood and intensity of insiders to make personal stock donation is reduced when firms have strong corporate social responsibility (CSR). Agency theory explains insiders' opportunistic behavior, stakeholder theory is also supported by evidence that stock donation is negatively related to CSR, and stewardship theory offers a different view to explain the rationale behind insiders' stock donation and shareholders' reactions to stock gifts. (shrink)
A time series of the Shanghai stock index in China for the 1990s is studied for the possible existence of nonlinear speculative bubbles. Three alternative specifications of fundamentals are estimated using VAR models of domestic and international variables. These are subjected to regime switching tests and rescaled range analysis tests. Nulls of no persistence were mostly rejected, suggesting the strong possibility of bubbles. Nonlinearities beyond ARCH effects using the BDS test could not be rejected. The paper also discusses the (...) special circumstances of the stock market in an emerging transition economy. (shrink)
While many aspects of stock and option based compensation for corporate officers remain controversial, we suggest that the growingtrend for similar practices in favor of boards of directors will prove to be even more contentious. High-ranking corporate managers do not set their own salaries nor authorize their own stock options. By contrast, boards of directors do, in fact, set their own compensationpackages. Other potential conflicts of interest include setting option performance targets, stock buybacks, stock option resets (...) and reloads, consolidations (mergers and acquisitions). and service on multiple boards. As trust is the most valuable commodity in a capitalist society, we suggest that these potential conflicts of interest and related outcomes may ultimately serve to erode any anticipated benefits of director stock compensation. (shrink)
In this paper, we compare firm-specific attributes including outside director remuneration for two groups of firms. One of these groups consists of 96 firms that did not give stock options to the CEO during the sample period 1992 2001, while the other group of 571 firms granted stock options on a consistent basis during these years. Our results indicate that for the group with stock option grants, the remuneration to outside directors was significantly higher and the CEO (...) had longer tenure compared to the other group. These results are robust even after controlling for other economic attributes associated with the decision to grant stock options. (shrink)
The goal of this paper was to assess whether, given the opportunity, physicians/researchers would try to profit (by trading stocks) from information that only they were made privy to. The Annual ASCO (American Society of Clinical Oncology) Conference, the largest annual oncology conference, provided the perfect venue to fully explore this question. Up until 2008, ASCO abstracts were released exclusively to ASCO members (i.e., physicians, oncologists) two weeks prior to the conference, and many speculated about unusual trading patterns during these (...) two weeks. In 2008, in response to concerns about such illicit activities, ASCO changed this policy (by distributing these abstracts instead to the general public). We decided to take a closer look at these trading patterns to determine the true impact of ASCO's 2008 decision and whether the differences prior to and following 2008 reveal something about the likelihood of physicians/researchers to profit from “privileged information.”. (shrink)
Lockean natural rights theories have long been associated with laissez-faire policies on the part of the government, in large measure because of the sanctity they accord to individual rights, especially private property rights. However, I will argue that if one attempts to apply such theories to moral questions about pollution, they present a different face, one set so firmly against laissez-faire -- or laissez-polluer -- as to countenance serious restriction of what Lockeans have traditionally taken to be the proper sphere (...) of individual freedom. (shrink)
