The Pre-1980 Roots of Neoliberal Financial Deregulation

U.S. financial deregulation is often popularly presented as a fundamental attack on financial regulation that began with neoliberalism's Big Bang in 1980. This paper argues this position is wrong in two ways. First, it is a process that stretches back decades before 1980. Textbook mentions of 1970s precursor "financial innovations" fall far short of presenting the breadth and duration of the pre-1980 attack on the system of regulation. Second, it has not been an across-the-board attack on financial regulation in the name of market efficiency as required by its ideology and claimed by its advocates, but rather a focused attack on only one of the five pillars of the system of regulation. This paper develops both of these assertions through a presentation of the five central pillars of the pre-1980 system of financial regulation, and the four major attacks on the three different aspects of the restrictions on financial competition.

Response to the Discussion of "The Effect on Financial Reporting Quality of an Exemption From the SEC Reporting Requirements for Foreign Private Issuers"

We appreciate the thorough discussion provided by Professor Yuan Ding. His comments raise legitimate issues. In this response, we offer clarifications and suggest avenues for future research. Our response follows the structure of the discussant’s paper and elaborates on each point separately.

The Effect on Financial Reporting Quality of an Exemption From the SEC Reporting Requirements for Foreign Private Issuers

We test for differences in financial reporting quality between companies that are required to file periodically with the SEC and those that are exempted from filing reports with the SEC under Rule 12g3-2(b). We examine three earnings quality measures: conservatism, abnormal accruals, and the predictability of earnings. Our results, for all three measures, show different financial reporting quality for companies that file with the SEC than for companies exempt from filing requirements. This paper provides empirical evidence of a link between filing with the SEC and financial reporting quality for foreign firms.

Changes in annual reporting rituals of financial services firms in periods of market crisis

This paper examines accounting and financial reporting as ceremonial rituals. Its specific focus is upon changes in annual reporting rituals of financial services firms during periods of market crisis. Our preliminary findings suggest that several of the firms in our study may have made changes in their reporting rituals to construct alternative realities in an attempt to mask conflict, preserve stability, foster unity, and reinforce new social norms, core values, and corporate identities.

Chief Audit Executives’ Evaluations of Whistle-Blowing Allegations

This study examines the effects of the source of whistle-blowing allegations and potential for allegations to trigger concerns about reputation threats on Chief Audit Executives’ handling of whistle-blowing allegations. The participants for this study, 79 Chief Audit Executives (CAEs) and deputy CAEs, evaluated whistle-blowing reports related to financial reporting malfeasance that were received from either an anonymous or a non-anonymous source. The whistle-blowing reports alleged that the wrongdoing resulted from either the exploitation of substantial weaknesses in internal controls (suggesting higher responsibility of the CAE and internal audit) or the circumvention of internal controls (suggesting lower responsibility of the CAE or internal audit). Findings indicate that CAEs believe anonymous whistle-blowing reports to be significantly less credible than non-anonymous reports. Although CAEs assessed lower credibility ratings for the reports alleging wrongdoing by the exploitation of substantial weaknesses in internal controls, they allocated more resources to investigating these allegations.

The Financial Rate of Profit: What Is It, and How Has It Behaved in the United States?

This work contributes to the almost nonexistent literature on the profit rate of the financial sector. It updates the single study to include financial variables to cover the past decade, compares this profit rate to the (almost unpublished) Weisskopf and NIPA financial profit rates, compares the financial and nonfinancial sector rates, and details the procedure to construct the profit rate in the financial sector including relevant financial variables which capitalists consider to make profit-rate decisions. JEL Classification: B50, E11

Non-State United States Support For The Contras During The Reagan Era

Under President Ronald Reagan, the White House pursued a complex foreign policy towards the Contras, rebels in trying to overthrow the Sandinista regime in Nicaragua, in Nicaragua. In 1979, the leftist Sandinista government seized power in Nicaragua. The loss of the previous pro-United States Somoza military dictatorship deeply troubled the conservatives, for whom eradication of communism internationally was a top foreign policy goal. Consequently, the Reagan Administration sought to redress the policy of his predecessor, Jimmy Carter, and assume a hard line stance against leftist regimes in Central America. Reagan and the conservatives within his administration, therefore, supported the Contra through military arms, humanitarian aid, and financial contributions. This intervention in Nicaragua, however, failed to garner popular support from American citizens and Democrats. Consequently, between 1982 and 1984 Congress prohibited further funding to the Contras in a series of legislation called the Boland Amendments. These Amendments barred any military aid from reaching the Contras, including through intelligence agencies. Shortly after their passage, Central Intelligence Agency Director William Casey and influential members of Reagan¿s National Security Council (NSC) including National Security Advisor Robert McFarlane, NSC Aide Oliver North, and Deputy National Security Advisor John Poindexter cooperated to identify and exploit loopholes in the legislation. By recognizing the NSC as a non-intelligence body, these masterminds orchestrated a scheme in which third parties, including foreign countries and private donors, contributed both financially and through arms donations to sustain the Contras independently of Congressional oversight. This thesis explores the mechanism and process of soliciting donations from private individuals, recognizing the forces and actors that created a situation for covert action to continue without detection. Oliver North, the main actor of the state, worked within his role as an NSC bureaucrat to network with influential politicians and private individuals to execute the orders of his superiors and shape foreign policy. Although Reagan articulated his desire for the Contras to remain a military presence in Nicaragua, he delegated the details of policy to his subordinates, which allowed this scheme to flourish. Second, this thesis explores the individual donors, analyzing their role as private citizens in sustaining and encouraging the policy of the Reagan Administration. The Contra movement found non-state support from followers of the New Right, demonstrated through financial and organizational assistance, that allowed the Reagan Administration¿s statistically unpopular policy in Nicaragua to continue. I interpret these donors as politically involved, but politically philanthropic, individuals, donating to their charity of choice to further the principles of American freedom internationally in a Cold War environment. The thesis then proceeds to assess the balance of power between the executive and other political actors in shaping policy, concluding that the executive cannot act alone in the formulation and implementation of foreign policy.

Effects Of Perceived Financial Accessibility Of Colleges And Universities On Studentsâ¿ Assesment Of Institutional Desirability

This study focused on the effects of socioeconomic exclusivity indicators on college students¿ attitudes toward a hypothetical private liberal arts university. Students enrolled in two undergraduate courses in Education at an elite private liberal arts university in the northeast were randomly presented with one of three versions of an admissions brochure describing a fictitious university. The three versions of the brochure varied in their portrayals of the institution¿s financial exclusivity, ranging from high exclusivity to low exclusivity. Each student was asked to review the brochure and respond to a questionnaire, containing items pertaining to the overall desirability of the institution, as well as its student culture, academic program, campus traditions, and alumni network. Based on Thorstein Veblen¿s theory of the leisure class and Pierre Bourdieu¿s theory of social reproduction, it was hypothesized that students would judge the institution most favorably in all areas under the high exclusivity condition and least favorably under the low exclusivity condition. It was further hypothesized that differences in students¿ ratings of institutional desirability would be mediated by their own financial aid statuses. Results of a two-way multivariate analysis of variance (MANOVA) revealed significant (p < .05) interactive effects of institutional exclusivity and student aid status on the perceived desirability of the academic program and campus traditions of the institution. While recipients of need-based financial aid tended to rate more socioeconomically exclusive institutions more favorably on these two variables, those who were not receiving need-based financial aid tended to rate such institutions less favorably. Implications of the findings for student affairs practice are discussed and recommendations for further research are presented.

The Dual Ownership Structure: a Model to Connect the Cooperative Model With Financial Markets

In business literature, the conflicts among workers, shareholders and the management have been studied mostly in the frame of stakeholder theory. The stakeholder theory recognizes this issue as an agency problem, and tries to solve the problem by establishing a contractual relationship between the agent and principals. However, as Marcoux pointed out, the appropriateness of the contract as a medium to reduce the agency problem should be questioned. As an alternative, the cooperative model minimizes the agency costs by integrating the concept of workers, owners and management. Mondragon Corporation is a successful example of the cooperative model which grew into the sixth largest corporation in Spain. However, the cooperative model has long been ignored in discussions of corporate governance, mainly because the success of the cooperative model is extremely difficult to duplicate in reality. This thesis hopes to revitalize the scholarly examination of cooperatives by developing a new model that overcomes the fundamental problem in the cooperative model: the limited access to capital markets. By dividing the ownership interest into financial and control interest, the dual ownership structure allows cooperatives to issue stock in the capital market by making a financial product out of financial interest.

The Effect of Chronic Estrogen Administration on Same-Sex Social Behavior and Central Oxytocin Levels in Prairie Voles (Microtus ochrogaster)

The purpose of our study is to investigate the effects of chronic estrogen administration on same-sex interactions during exposure to a social stressor and on oxytocin (OT) levels in prairie voles (Microtus orchrogaster). Estrogen and OT are two hormones known to be involved with social behavior and stress. Estogen is involved in the transcription of OT and its receptor. Because of this, it is generally thought that estrogen upregulates OT, but evidence to support this assumption is weak. While estrogen has been shown to either increase or decrease stress, OT has been shown to have stress-dampening properties. The goal of our experiment is to determine how estrogen affects OT levels as well as behavior in a social stressor in the voles. In addition, estrogen is required for many opposite-sex interactions, but little is known about its influence on same-sex interactions. We hypothesized that prairie voles receiving chronic estrogen injections would show an increase in OT levels in the brain and alter behavior in response to a social stressor called the resident-intruder test. To test this hypothesis, 73 female prairie voles were ovariectomized and then administered daily injections of estrogen (0.05 ¿g in peanut oil, s.c.) or vehicle for 8 days. On the final day of injections, half of the voles were given the resident-intruder test, a stressful 5 min interaction with a same-sex stranger. Their behavior was video-recorded. These animals were then sacrificed either 10 minutes or 60 minutes after the conclusion of the test. Half of the animals (no stress group) were not given the resident-intruder test. After sacrifice, trunk blood and brains were collected from the animals. Videos of the resident-intruder tests were analyzed for pro-social and aggressive behavior. Density of OT-activated neurons in the brain was measured via pixel count using immunohistochemistry. No differences were found in pro-social behavior (focal sniffing, p = 0.242; focal initiated sniffing p = 0.142; focal initiated sniffing/focal sniffing, p = 0.884) or aggressive behavior (total time fighting, p= 0.763; number of fights, p= 0.148; number of strikes, p = 0.714). No differences were found in activation of OT neurons in the brain, neither in the anterior paraventricular nucleus (PVN) (pixel count p= 0.358; % area that contains pixelated neurons p = 0.443) nor in the medial PVN (pixel count p= 0.999; % area that contains pixelated neurons p = 0.916). These results suggest that estrogen most likely does not directly upregulate OT and that estrogen does not alter behavior in stressful social interactions with a same-sex stranger. Estrogen may prepare the animal to respond to OT, instead of increasing the production of the peptide itself, suggesting that we need to shift the framework in which we consider estrogen and OT interactions.