The Unanticipated Effects of Insider Trading Regulation

Using a sample of 2,827 firms from 21 countries we examine whether insider trading laws achieve the primary objective for which they are introduced – protecting uninformed investors from private information-based trading. We find that when control is concentrated in the hands of a large shareholder, insider trading regulation is less effective in reducing private information-based trading if investor protection is poor. We suggest that controlling shareholders who are banned from trading may resort to covert expropriation of firm resources, creating more information asymmetry and thereby encouraging private information trading by informed outsiders. Consistent with this, we find evidence that when the rights of controlling shareholders are high, insider trading restrictions are associated with greater earnings opacity.http://deepblue.lib.umich.edu/bitstream/2027.42/40081/3/wp695.pd

To steal or not to steal: Firm attributes, legal environment, and valuation

Newly released data on corporate governance and disclosure practices reveal wide within-country variation, with the variation increasing as legal environment gets less investor friendly. This paper examines why firms practice high-quality governance when law does not require it; firm attributes that are related to the quality of governance; how the attributes interact with legal environment; and the relation between firm valuation and corporate governance. A simple model, in which a controlling shareholder trades off private benefits of diversion against costs that vary across countries and time, identifies three relevant firm attributes: investment opportunities, external financing, and ownership structure. Using firm-level governance and transparency data on 859 firms in 27 countries, we find that firms with greater growth opportunities, greater needs for external financing, and more concentrated cash flow rights practice higher-quality governance and disclose more. Moreover, firms that score higher in governance and transparency rankings are valued higher in the stock market. Equally important, all these relations are stronger in countries that are less investor friendly, demonstrating that firms do adapt to poor legal environments to establish efficient governance practices.http://deepblue.lib.umich.edu/bitstream/2027.42/39939/3/wp554.pd

The Unanticipated Effects of Insider Trading Regulation

Using a sample of 2,827 firms from 21 countries we examine whether insider trading laws achieve the primary objective for which they are introduced – protecting uninformed investors from private information-based trading. We find that when control is concentrated in the hands of a large shareholder, insider trading regulation is less effective in reducing private information-based trading if investor protection is poor. We suggest that controlling shareholders who are banned from trading may resort to covert expropriation of firm resources, creating more information asymmetry and thereby encouraging private information trading by informed outsiders. Consistent with this, we find evidence that when the rights of controlling shareholders are high, insider trading restrictions are associated with greater earnings opacity.Insider Trading Regulation, Ownership, Private Information Trading, Earnings Opacity

Second harmonic generation at the edge of a two-dimensional electron gas

We show that driving a two-dimensional electron gas by an in-plane electric field oscillating at the frequency $\omega$ gives rise to an electric current at $2\omega$ flowing near the edge of the system. This current has both parallel and perpendicular to the edge components, which emit electromagnetic waves at $2\omega$ with different polarizations. We develop a microscopic theory of such an edge second harmonic generation and calculate the edge current at $2\omega$ in different regimes of electron transport and electric field screening. We also show that at high frequencies the spatial profile of the edge current contains oscillations caused by excitation of plasma waves.Comment: 8 pages, 6 figure

Pharmaceutical Toxicology is the Most Important Component of Preclinical Studies

The first principle for ensuring patient safety is to do no harm (primum non nocere). It clearly justifies why the legislative requirements for the safety of medicinal products should be strict and meticulous. The aim of preclinical safety evaluation     is to protect public health by preventing the clinical use of medicinal products with   a potentially unfavourable risk–benefit profile. Traditionally, toxicology is defined as the study of the adverse effects of chemical substances on living organisms. Toxicity studies are integral to preclinical programmes for new medicinal products. The role of toxicology in preclinical studies is explained in this interview by Corresponding Member of the Russian Academy of Sciences, Doctor of Medical Sciences, and Full Professor Andrey D. Durnev. Dr. Durnev is a laureate of the State Prize of the Russian Federation. He holds the positions of Head of the Pharmaceutical Toxicology Department of V.V. Zakusov Institute of Pharmacology, Chairman of the Commission of the Ministry of Health of the Russian Federation for the Certification of Experts for the Right to Perform Regulatory Evaluation of Medicinal Products for Human Use, and Deputy Chairman of the Interdepartmental Council of the Russian Academy of Sciences on the Scientific Substantiation and Maintenance of Drug Policy of the Russian Federation