Alternatives to prohibition illicit drugs: how we can stop killing and criminalising young Australians

This report follows from a Roundtable discussion held in July 2012 to consider new approaches to public policy about illicit drugs in Australia. An earlier Australia21 report launched in April 2012 had concluded that attempts to control drug use through the criminal justice system have clearly failed. They have also caused the needless and damaging criminalisation of too many young people, often with adverse life-changing consequences, including premature death from overdose

How to Increase Elaboration Levels: An Adapted Elaboration Likelihood Model

Persuasion is a topic that has been debated for centuries, yet scientific literature surrounding the topic has been almost non-existent until 50 years ago. A popular persuasion model thus far, the Elaboration Likelihood Model, provides a framework for studying persuasion but lacks ease of application. I suggest an improvement to the model by including self-referencing and interaction to clarify how to apply the research and provide a real-world application with this adapted model

How Big is the Tax Advantage to Debt?

This paper uses an option valuation model of the firm to answer the question, "What magnitude tax advantage to debt is consistent with the range of observed corporate debt ratios?" We incorporate into the model differential personal tax rates on capital gains and ordinary income. We conclude that variations in the magnitude of bankruptcy costs across firms can not by itself account for the simultaneous existence of levered and unlevered firms. When it is possible for the value of the underlying assets to junip discretely to zero, differences across firms in the probability of this jump can account for the simultaneous existence of levered and unlevered firms. Moreover, if the tax advantage to debt is small, the annual rate of return advantage offered by optimal leverage may be so small as to make the firm indifferent about debt policy over a wide range of debt-to-firm value ratios.

Debt Policy and the Rate of Return Premium to Leverage

Equilibrium in the market for real assets requires that the price of those assets be bid up to reflect the tax shields they can offer to levered firms.Thus there must be an equality between the market values of real assets and the values of optimally levered firms. The standard measure of the advantage to leverage compares the values of levered and unlevered assets, and can be misleading and difficult to interpret. We show that a meaningful measure of the advantage to debt is the extra rate of return, net of a market premium for bankruptcy risk, earned by a levered firm relative to an otherwise-identical unlevered firm. We construct an option valuation model to calculate such a measure and present extensive simulation results. We use this model to compute optimal debt maturities, show how this approach can be used for capital budgeting, and discuss its implications for the comparison of bankruptcy costs versus tax shields.

Constant gap length trees in products of thick Cantor sets

We show that products of sufficiently thick Cantor sets generate trees in the plane with constant distance between adjacent vertices. Moreover, we prove that the set of admissible gap lengths has non-empty interior. This builds on the authors' previous work on distance sets of products of Cantor sets of sufficient Newhouse thickness