Contributions in Merlin

We use propensity score matching methods to quantify the effects of past self-employment experience on subsequent earnings in dependent employment using data on the population of Danish men observed between 1990 and 1996. Our results generally confirm existing studies in that we find that a spell of self-employment is associated with lower hourly wages compared to workers who were consecutively wage-employed. We also show, however, that this effect disappears—and even becomes positive in some settings—for formerly self-employed who find dependent employment in the same sector as their self-employment sector. Hence, the on average negative effect of self-employment is rather caused by sector switching than by the self-employment experience per se. Moreover, formerly self-employed who either enjoyed a high income or hired at least one worker during their self-employment spell receive wages in subsequent dependent employment that are at least as high as for individuals who have been consecutively wage-employed.

The present study examined the modality specificity and spatio-temporal dynamics of "what" and "where" preparatory processes in anticipation of auditory and visual targets using ERPs and a cue-target paradigm. Participants were presented with an auditory (Experiment 1) or a visual (Experiment 2) cue that signaled them to attend to the identity or location of an upcoming auditory or visual target. In both experiments, participants responded faster to the location compared to the identity conditions. Multivariate spatio-temporal partial least square (ST-PLS) analysis of the scalp-recorded data revealed supramodal "where" preparatory processes between 300-600 msec and 600-1200 msec at central and posterior parietal electrode sites in anticipation of both auditory and visual targets. Furthermore, preparation for pitch processing was captured at modality-specific temporal regions between 300 and 700 msec, and preparation for shape processing was detected at occipital electrode sites between 700 and 1150 msec. The spatio-temporal patterns noted above were replicated when a visual cue signaled the upcoming response (Experiment 2). Pitch or shape preparation exhibited modality-dependent spatio-temporal patterns, whereas preparation for target localization was associated with larger amplitude deflections at multimodal, centro-parietal sites preceding both auditory and visual targets. Using a novel paradigm, the study supports the notion of a division of labor in the auditory and visual pathways following both auditory and visual cues that signal identity or location response preparation to upcoming auditory or visual targets.

We present a new and general technique for obtaining closed-form expansions for prices of options in the Heston model, in terms of Black–Scholes prices and Black–Scholes Greeks up to arbitrary order. We then apply the technique to solve, in detail, the cases for the second-order and third-order expansions. In particular, such expansions show how the convexity in volatility, measured by the Black–Scholes volga, and the sensitivity of delta with respect to volatility, measured by the Black–Scholes vanna, impact option prices in the Heston model. The general method for obtaining the expansion rests on the construction of a set of new probability measures, equivalent to the original pricing measure, and which retain the affine structure of the Heston volatility diffusion. Finally, we extend the method to the pricing of forward-starting options in the Heston model.

This paper provides a new and systematic characterization of 488 universities, from 11 European countries: Finland, France, Germany, Hungary, Italy, Netherlands, Norway, Portugal, Spain, Switzerland and UK. Using micro indicators built on the integrated Aquameth database, we characterize the European university landscape according to the following dimensions: history/foundation of university, dynamics of growth, specialization pattern, subject mix, funding composition, offer profile and productivity.

DescriptionThe subprime crisis has shown that the sophisticated risk management models used by banks and insurance companies had serious flaws. Some people even suggest that these models are completely useless. Others claim that the crisis was just an unpredictable accident that was largely amplified by the lack of expertise and even naivety of many investors. This book takes the middle view. It shows that these models have been designed for "tranquil times", when financial markets behave smoothly and efficiently. However, we are living in more and more "turbulent times": large risks materialize much more often than predicted by "normal" models, financial models periodically go through bubbles and crashes. Moreover, financial risks result from the decisions of economic actors who can have incentives to take excessive risks, especially when their remunerations are ill designed. The book provides a clear account of the fundamental hypotheses underlying the most popular models of risk management and show that these hypotheses are flawed. However it shows that simple models can still be useful, provided they are well understood and used with caution.

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In parallel with liberalization, sector-specific regulation in network industries has become a widely discussed topic among academics, policy makers, industry economists and regulators themselves. The issue of these debates has usually been on whether such regulation is necessary and if so what its optimal design should be. Some argue for complete deregulation (i.e., the complete abolishment of sector-specific regulations), whereas others propose reregulations, that is the replacement of pre-existing (monopoly) regulations by new regulations aiming at safeguarding service levels and competition. The resulting compromise is often somewhere in between; the liberalization process usually entails the partial replacement and realignment of sector-specific regulatory intervention by the disciplining forces of competition protected by competition law. Consequently, competition law and sector-specific regulation play complementary roles. In this paper, we present a general economic framework to assess regulatory remedies in network industries. Therein, liberalization, or more generally market access regulation, can be assessed as well. It provides a foundation and explanation of current sector-specific regulations in place.

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