‘Relais actors’ and co-decision first reading agreements in the European Parliament : the case of the advanced therapies regulation

The processing of the advanced therapies regulation is of particular interest to scholars of the European Union's (EU) legislative process and students of the European Parliament (EP) because it provides a case study which throws light upon assumptions commonly made about the role of the EP's ‘relais actors’, the promotion of consensus-building within and between parliamentary committees, and the development of intraorganizational rules in response to early agreements in the co-decision procedure. An examination of the EP's processing of the advanced therapies dossier provides an ‘unusual’ but vivid illustration of how the identification of committee rapporteurs as the most important parliamentary ‘relais actors’ fails to capture the increasingly important roles performed by shadow rapporteurs. Significantly, the ‘unusual’ occurrences associated with the processing of the advanced therapies regulation came at a crucial juncture in the reconsideration of the EP's intraorganizational rules in relation to early agreements and the subsequent adoption of new Rules of Procedure in 2009

Make Versus Buy in Trucking: Asset Ownership, Job Design and Information

Explaining patterns of asset ownership in the economy is a central goal of both organizational economics and industrial organization. We develop a model of asset ownership in trucking, which we test by examining how the adoption of different classes of on-board computers (OBCs) between 1987 and 1997 influenced whether shippers use their own trucks for hauls or contract with for-hire carriers. We find that OBCs' incentive-improving features pushed hauls toward private carriage, but their resource-allocation-improving features pushed them toward for-hire carriage. We conclude that ownership patterns in trucking reflect the importance of both incomplete contracts (Grossman and Hart (1986)) and of job design and measurement issues (Holmstrom and Milgrom (1994)).

Pulling the Strings: Party Group Coordinators in the European Parliament

Since its post-Lisbon increase in (legislative and non-legislative) powers, the European Parliament (EP) is more relevant than ever in the geographically diversified multilevel system of the EU. Party group coordinators occupy a crucial position in collective decision-making within the EP. However, knowledge about these pivotal actors is absent. This raises the question as to who these party group coordinators are, what they do, and what indeed makes a good coordinator. A new data set shows that in 2012, more than one-fifth of coordinators of the three largest and most influential groups are German, with British and Spanish coordinators ranking a distant second before Romanians. Among coordinators from NMS, only one-eighth were newcomers

Firms, Courts, and Reputation Mechanisms: Towards a Positive Theory of Private Ordering

This Essay formulates a positive model that predicts when commercial parties will employ private ordering to enforce their agreements. The typical enforcement mechanism associated with private ordering is the reputation mechanism, in which a merchant community punishes parties in breach of contract by denying them future business. The growing private ordering literature argues that these private enforcement mechanisms can be superior to the traditional, less efficient enforcement measures provided by public courts. However, previous comparisons between public and private contractual enforcement have presented a misleading dichotomy by failing to consider a third enforcement mechanim: the vertically integrated firm. This Essay develops a model that comprehensively addresses three distinct types of enforcement mechanisms--firms, courts, and reputation-based private ordering. The model rests on a synthesis of transaction cost economics, which compares the efficiencies of firms versus markets, and the private ordering literature, which compares the efficiencies of public courts versus private ordering. It hypothesizes that private ordering will arise when agreements present enforcement difficulties, high-powered market incentives are important, and the costs of entry barriers are low. The Essay then conducts an illustrative test by comparing the model\u27s predictions to documented instances of private ordering

"What Do Banks Do? What Should Banks Do?"

Before we can reform the financial system, we need to understand what banks do; or, better, what banks should do. This paper will examine the later work of Hyman Minsky at the Levy Institute, on his project titled "Reconstituting the United States' Financial Structure." This led to a number of Levy working papers and also to a draft book manuscript that was left uncompleted at his death in 1996. In this paper I focus on Minsky’s papers and manuscripts from 1992 to 1996 and his last major contribution (his Veblen-Commons Award–winning paper). Much of this work was devoted to his thoughts on the role that banks do and should play in the economy. To put it as succinctly as possible, Minsky always insisted that the proper role of the financial system was to promote the "capital development" of the economy. By this he did not simply mean that banks should finance investment in physical capital. Rather, he was concerned with creating a financial structure that would be conducive to economic development to improve living standards, broadly defined. Central to his argument is the understanding of banking that he developed over his career. Just as the financial system changed (and with it, the capitalist economy), Minsky’s views evolved. I will conclude with general recommendations for reform along Minskyan lines.China; Hyman Minsky; Banks and Shadow Banks; Money Manager Capitalism; Finance Capital; Financial Instability Hypothesis; Global Financial Crisis; Debt Deflation Theory

Moral hazard and the financial crisis of 2007-9: An Explanation for why the subprime mortgage defaults and the housing market collapse produced a financial crisis that was more severe than any previous crashes (with exception of the Great Depression of 1929)

This paper examines the financial crisis in 2007-9 that was more severe than previous crashes, including the dot-com crash of 2001 and the market crash of 1987 (with the exception of the Great Depression of 1929). This severity was due to excessively risky speculative bets taken by the executives of financial institutions. When the ?housing bubble? burst, these speculative bets, which were based on the U.S. housing market and the subprime mortgages, triggered the financial systemic failures of the U.S. in June 2007 (the subprime mortgage crisis) and September 2008 (the shadow-banking crisis). The systemic financial failure of September 2008 (the shadow-banking crisis) was greatly amplified by excessively risky speculations and this led to a rapid deterioration of the entire global economy. This paper examines the potential for moral hazard in the financial system leading up to this crisis, and attempts to determine if this was a motivating factor in these risky bets.moral hazard, financial crisis of 2007-9, burst of the housing bubble, subprime mortgages crisis, shadow-banking crisis

Co-Determination in Germany: 1949-1979 and There Beyond: Bonding or Compulsion?

Co-determination refers to a set of rules and institutions which form an interlocking system and as such provide the unique structure of German corporate governance. This essay deals with the reasons responsible for bringing the structure about. In particular, the decision making process leading up to co-determination is carefully analyzed in terms of deciding the question, whether the participants were engaged in rent-seeking or in efficient legislation. Key words: co-determination, decisions under uncertainty, strategic legislative choice, human capital accumulation, joint stock companies, demountation, performance of institutionsindustrial organization ;

"What Should Banks Do? A Minskyan Analysis"

In this new brief, Senior Scholar L. Randall Wray examines the later works of Hyman P. Minsky, with a focus on Minsky’s general approach to financial institutions and policy. The New Deal reforms of the 1930s strengthened the financial system by separating investment banks from commercial banks and putting in place government guarantees such as deposit insurance. But the system’s relative stability, and relatively high rate of economic growth, encouraged innovations that subverted those constraints over time. Financial wealth (and private debt) grew on trend, producing immense sums of money under professional management: we had entered what Minsky, in the early 1990s, labeled the “money manager” phase of capitalism. With help from the government, power was consolidated in a handful of huge firms that provided the four main financial services: commercial banking, payments services, investment banking, and mortgages. Brokers didn’t have a fiduciary responsibility to act in their clients’ best interests, while financial institutions bet against households, firms, and governments. By the early 2000s, says Wray, banking had strayed far from the (Minskyan) notion that it should promote “capital development” of the economy.