The interaction between the equity premium and the risk-free rate

The equity premium arises from the interaction between the atemporal risk premium for equity, the risk-free rate of intertemporal substitution and the impact of risk on the precautionary motive for saving. Depending on parameter values, the equity premium may either be increased or reduced by the presence of undiversifiable background risk. (C) 2000 Elsevier Science S.A. All rights reserved.

A comparison of model laws as a starting point for the development of an enforceable international consumer protection regime

This article is concerned primarily with an examination and comparison of select aspects of the model international consumer protection laws proposed by the United Nations (UN), the European Union (EU), and the Organisation for Economic Co-operation and Development (OECD), using the Trade Practices Act 1974 (Australia) as a basis for examination and comparison. As a secondary consideration, it also broadly examines the content of, and differences between, the model laws. The motive for this article is that any future enforceable international consumer protection regime (possibly in the form of an international treaty or convention) would need to take into account the UN, EU and OECD guidelines. A cross-comparison of those model laws, and a comparison of them with the consumer protection provisions of a well established national consumer protection law, should provide a useful starting point for the development of such a regime. The 'select aspects' of the model laws in question are the various provisions of those laws which could relate to situations involving the wrong delivery or non-delivery of goods.

Micro-meso-macro

Building on the ontology of evolutionary realism recently proposed by Dopfer and Potts (forthcoming), we develop an analytical framework for evolutionary economics with a micro-meso-macro architecture. The motive for reconception is to make clear the highly complex and emergent nature of existence and change in economic evolution. For us, the central insight is that an economic system is a population of rules, a structure of rules, and a process of rules. The economic system is a rule-system contained in what we call the meso. From the evolutionary perspective, one cannot directly sum micro into macro. Instead, we conceive of an economic system as a set of meso units, where each meso consists of a rule and its population of actualizations. The proper analytical structure of evolutionary economics is in terms of micro-meso-macro. Micro refers to the individual carriers of rules and the systems they organize, and macro consists of the population structure of systems of meso. Micro structure is between the elements of the meso, and macro structure is between meso elements. The upshot is an ontologically coherent framework for analysis of economic evolution as change in the meso domain - in the form of what we call a meso trajectory - and a way of understanding the micro-processes and macro-consequences involved. We believe that the micro-meso-macro analytical framework can greatly enhance the focus, clarity, and, ultimately, power, of evolutionary economic theory.

Motivations for group membership: The role of subjective importance and uncertainty reduction

An experiment was conducted to investigate the idea that an important motive for identifying with social groups is to reduce subjective uncertainty, particularly uncertainty on subjectively important dimensions that have implications for the self-concept (e.g., Hogg, 1996; Hogg & Mullin, 1999). When people are uncertain on a dimension that is subjectively important, they self-categorize in terms of an available social categorization and, thus, exhibit group behaviors. To test this general hypothesis, group membership, task uncertainty, and task importance were manipulated in a 2 x 2 x 2 between-participants design (N = 128), under relatively minimal group conditions. Ingroup identification and desire for consensual validation of specific attitudes were the key dependent measures, but we also measured social awareness. All three predictions were supported. Participants identified with their group (H1), and desired to obtain consensual validation from ingroup members (H2) when they were uncertain about their judgments on important dimensions, indicating that uncertainty reduction motivated participants towards embracing group membership. In addition, identification mediated the interactive effect of the independent variables on consensual validation (H3), and the experimental results were not associated with an increased sense of social awareness and, therefore, were unlikely to represent only behavioral compliance with generic social norms. Some implications of this research in the study of cults and totalist groups and the explication of genocide and group violence are discussed.