Dynamic adverse selection and debt

This paper argues that the strategic use of debt favours the revelationof information in dynamic adverse selection problems. Our argument is basedon the idea that debt is a credible commitment to end long term relationships.Consequently, debt encourages a privately informed party to disclose itsinformation at early stages of a relationship. We illustrate our pointwith the financing decision of a monopolist selling a good to a buyerwhose valuation is private information. A high level of (renegotiable)debt, by increasing the scope for liquidation, may induce the highvaluation buyer to buy early at a high price and thus increase themonopolist's expected payoff. By affecting the buyer's strategy, it mayreduce the probability of excessive liquidation. We investigate theconsequences of good durability and we examine the way debt mayalleviate the ratchet effect.

Optimal contracts, adverse selection and social preferences: An experiment

It has long been standard in agency theory to search for incentive-compatible mechanisms on the assumption that people care only about their own material wealth. However, this assumption is clearly refuted by numerous experiments, and we feel that it may be useful to consider nonpecuniary utility in mechanism design and contract theory. Accordingly, we devise an experiment to explore optimal contracts in an adverse-selection context. A principal proposes one of three contract menus, each of which offers a choice of two incentive-compatible contracts, to two agents whose types are unknown to the principal. The agents know the set of possible menus, and choose to either accept one of the two contracts offered in the proposed menu or to reject the menu altogether; a rejection by either agent leads to lower (and equal) reservation payoffs for all parties. While all three possible menus favor the principal, they do so to varying degrees. We observe numerous rejections of the more lopsided menus, and approach an equilibrium where one of the more equitable contract menus (which one depends on the reservation payoffs) is proposed and agents accept a contract, selecting actions according to their types. Behavior is largely consistent with all recent models of social preferences, strongly suggesting there is value in considering nonpecuniary utility in agency theory.

The adverse effects of environmental policy in green markets

We model green markets in which purchasers, either firms orconsumers, have higher willingness-to-pay for lesspolluting goods. The effectiveness of pollution reductionpolicies is examined in a duopoly setting. We show thatduopolists' strategic behaviour may increase pollutionlevels. Maximum emission standards, commonly used in greenmarkets, improve the environmental features of products.Nonetheless, overall pollution levels will rise becausegovernment regulation also affects market shares and bootsfirms' sales. Consequently, social welfare may be reduced.We also explore the effects of technological subsidies andproduct charges, including differentiation of charges.

Prevention of preterm delivery with vaginal progesterone in women with preterm labour (4P): randomised double-blind placebo-controlled trial.

OBJECTIVE: To evaluate the effectiveness of 200 mg of daily vaginal natural progesterone to prevent preterm birth in women with preterm labour. DESIGN: Multicentre, randomised, double-blind, placebo-controlled trial. SETTING: Twenty-nine centres in Switzerland and Argentina. POPULATION: A total of 385 women with preterm labour (24(0/7) to 33(6/7)  weeks of gestation) treated with acute tocolysis. METHODS: Participants were randomly allocated to either 200 mg daily of self-administered vaginal progesterone or placebo within 48 hours of starting acute tocolysis. MAIN OUTCOME MEASURES: Primary outcome was delivery before 37 weeks of gestation. Secondary outcomes were delivery before 32 and 34 weeks, adverse effects, duration of tocolysis, re-admissions for preterm labour, length of hospital stay, and neonatal morbidity and mortality. The study was ended prematurely based on results of the intermediate analysis. RESULTS: Preterm birth occurred in 42.5% of women in the progesterone group versus 35.5% in the placebo group (relative risk [RR] 1.2; 95% confidence interval [95% CI] 0.93-1.5). Delivery at <32 and <34 weeks did not differ between the two groups (12.9 versus 9.7%; [RR 1.3; 95% CI 0.7-2.5] and 19.7 versus 12.9% [RR 1.5; 95% CI 0.9-2.4], respectively). The duration of tocolysis, hospitalisation, and recurrence of preterm labour were comparable between groups. Neonatal morbidity occurred in 44 (22.8%) cases on progesterone versus 35 (18.8%) cases on placebo (RR: 1.2; 95% CI 0.82-1.8), whereas there were 4 (2%) neonatal deaths in each study group. CONCLUSION: There is no evidence that the daily administration of 200 mg vaginal progesterone decreases preterm birth or improves neonatal outcome in women with preterm labour.

Cohort study of trials submitted to ethics committee identified discrepant reporting of outcomes in publications.

OBJECTIVES: To identify factors associated with discrepant outcome reporting in randomized drug trials. STUDY DESIGN AND SETTING: Cohort study of protocols submitted to a Swiss ethics committee 1988-1998: 227 protocols and amendments were compared with 333 matching articles published during 1990-2008. Discrepant reporting was defined as addition, omission, or reclassification of outcomes. RESULTS: Overall, 870 of 2,966 unique outcomes were reported discrepantly (29.3%). Among protocol-defined primary outcomes, 6.9% were not reported (19 of 274), whereas 10.4% of reported outcomes (30 of 288) were not defined in the protocol. Corresponding percentages for secondary outcomes were 19.0% (284 of 1,495) and 14.1% (334 of 2,375). Discrepant reporting was more likely if P values were <0.05 compared with P ≥ 0.05 [adjusted odds ratio (aOR): 1.38; 95% confidence interval (CI): 1.07, 1.78], more likely for efficacy compared with harm outcomes (aOR: 2.99; 95% CI: 2.08, 4.30) and more likely for composite than for single outcomes (aOR: 1.48; 95% CI: 1.00, 2.20). Cardiology (aOR: 2.34; 95% CI: 1.44, 3.79) and infectious diseases (aOR: 1.77; 95% CI: 1.01, 3.13) had more discrepancies compared with all specialties combined. CONCLUSION: Discrepant reporting was associated with statistical significance of results, type of outcome, and specialty area. Trial protocols should be made freely available, and the publications should describe and justify any changes made to protocol-defined outcomes.

Predictors and Moderators of Clinical Outcomes in Adolescents with Severe Mental Disorders After an Assertive Community Treatment.

Previous studies have shown that stressful life events (SLEs), gender, social functioning and pretreatment severity are some of the predictors and/or moderators of treatment outcome in psychiatric care. The current study explored the effect of these predictors and moderators on the treatment outcome related to assertive community treatment (ACT) proposed to young people with severe mental disorders. 98 patients were assessed for externalizing and emotional difficulties, at admission and then at discharge of an ACT. Analyses revealed significant improvements in terms of symptomatology. In particular, regression analyses showed that pretreatment severity is a significant predictor of the outcome on emotional symptoms and is moderated by SLE on the outcome on externalizing symptoms. Furthermore, higher social functioning proved to predict better outcome on externalizing symptoms. Our results further evidence that these factors can explain inter-individual differences in outcome related to ACT. The theoretical and clinical implications of these results are discussed.

Adverse events to antiretrovirals in the Swiss HIV Cohort Study: effect on mortality and treatment modification.

BACKGROUND: Antiretroviral therapy (ART) decreases morbidity and mortality in HIV-infected patients but is associated with considerable adverse events (AEs). METHODS: We examined the effect of AEs to ART on mortality, treatment modifications and drop-out in the Swiss HIV Cohort Study. A cross-sectional evaluation of prevalence of 13 clinical and 11 laboratory parameters was performed in 1999 in 1,078 patients on ART. AEs were defined as abnormalities probably or certainly related to ART. A score including the number and severity of AEs was defined. The subsequent progression to death, drop-out and treatment modification due to intolerance were evaluated according to the baseline AE score and characteristics of individual AEs. RESULTS: Of the 1,078 patients, laboratory AEs were reported in 23% and clinical AEs in 45%. During a median follow up of 5.9 years, laboratory AEs were associated with higher mortality with an adjusted hazard ratio (HR) of 1.3 (95% confidence interval [CI] 1.2-1.5; P < 0.001) per score point. For clinical AEs no significant association with increased mortality was found. In contrast, an increasing score for clinical AEs (HR 1.11,95% CI 1.04-1.18; P = 0.002), but not for laboratory AEs (HR 1.07, 95% CI 0.97-1.17; P = 0.17), was associated with antiretroviral treatment modification. AEs were not associated with a higher drop-out rate. CONCLUSIONS: The burden of laboratory AEs to antiretroviral drugs is associated with a higher mortality. Physicians seem to change treatments to relieve clinical symptoms, while accepting laboratory AEs. Minimizing laboratory drug toxicity seems warranted and its influence on survival should be further evaluated.

A model of collateral, investment and adverse selection

This paper characterizes the relationship between entrepreneurial wealth and aggregate investmentunder adverse selection. Its main finding is that such a relationship need not bemonotonic. In particular, three results emerge from the analysis: (i) pooling equilibria, in whichinvestment is independent of entrepreneurial wealth, are more likely to arise when entrepreneurialwealth is relatively low; (ii) separating equilibria, in which investment is increasing inentrepreneurial wealth, are most likely to arise when entrepreneurial wealth is relatively highand; (iii) for a given interest rate, an increase in entrepreneurial wealth may generate a discontinuousfall in investment.

Strike outcomes and wage settlements in Spain

This paper analyzes collective bargaining using Spanish firm level data. Centralto the analysis are the joint determination of wage and strike outcomes in adynamic framework and the possibility of segregate wage equation for strike andnon-strike outcomes. Conditional to strikes taking place, we confirm a negativerelationship between strike duration and wage changes in a dynamic context.Furthermore, we find selection in wage equations induced by the strike outcome.In this sense, the possibility of wage determination processes being differentin strike and non-strike samples is not rejected by the data. In particular,wage dynamics are of opposite sing in both strike and non-strike equations.Finally, we find evidence of a 0.33 percentage points wage change strike premium.

Clinical evaluation of iron treatment efficiency among non-anemic but iron-deficient female blood donors: a randomized controlled trial.

ABSTRACT: Iron deficiency without anemia (IDWA) is related to adverse symptoms that can be relieved by supplementation. Since a blood donation can induce such an iron deficiency, we investigated the clinical impact of an iron treatment after blood donation. METHODS: One week after donation, we randomly assigned 154 female donors with IDWA aged <50 years to a 4-week oral treatment of ferrous sulfate vs. placebo. The main outcome was the change in the level of fatigue before and after the intervention. Also evaluated were aerobic capacity, mood disorder, quality of life, compliance and adverse events. Biological markers were hemoglobin and ferritin. RESULTS: Treatment effect from baseline to 4 weeks for hemoglobin and ferritin were 5.2 g/L (p < 0.01) and 14.8 ng/mL (p < 0.01) respectively. No significant clinical effect was observed for fatigue (-0.15 points, 95% confidence interval -0.9 to 0.6, p = 0.697) or for other outcomes. Compliance and interruption for side effects was similar in both groups. Additionally, blood donation did not induce overt symptoms of fatigue in spite of the significant biological changes it produces. CONCLUSIONS: These data are valuable as they enable us to conclude that donors with IDWA after a blood donation would not clinically benefit from iron supplementation. Trial registration: NCT00689793.

Carotid artery stenting compared with endarterectomy in patients with symptomatic carotid stenosis (International Carotid Stenting Study): an interim analysis of a randomised controlled trial.

BACKGROUND: Stents are an alternative treatment to carotid endarterectomy for symptomatic carotid stenosis, but previous trials have not established equivalent safety and efficacy. We compared the safety of carotid artery stenting with that of carotid endarterectomy. METHODS: The International Carotid Stenting Study (ICSS) is a multicentre, international, randomised controlled trial with blinded adjudication of outcomes. Patients with recently symptomatic carotid artery stenosis were randomly assigned in a 1:1 ratio to receive carotid artery stenting or carotid endarterectomy. Randomisation was by telephone call or fax to a central computerised service and was stratified by centre with minimisation for sex, age, contralateral occlusion, and side of the randomised artery. Patients and investigators were not masked to treatment assignment. Patients were followed up by independent clinicians not directly involved in delivering the randomised treatment. The primary outcome measure of the trial is the 3-year rate of fatal or disabling stroke in any territory, which has not been analysed yet. The main outcome measure for the interim safety analysis was the 120-day rate of stroke, death, or procedural myocardial infarction. Analysis was by intention to treat (ITT). This study is registered, number ISRCTN25337470. FINDINGS: The trial enrolled 1713 patients (stenting group, n=855; endarterectomy group, n=858). Two patients in the stenting group and one in the endarterectomy group withdrew immediately after randomisation, and were not included in the ITT analysis. Between randomisation and 120 days, there were 34 (Kaplan-Meier estimate 4.0%) events of disabling stroke or death in the stenting group compared with 27 (3.2%) events in the endarterectomy group (hazard ratio [HR] 1.28, 95% CI 0.77-2.11). The incidence of stroke, death, or procedural myocardial infarction was 8.5% in the stenting group compared with 5.2% in the endarterectomy group (72 vs 44 events; HR 1.69, 1.16-2.45, p=0.006). Risks of any stroke (65 vs 35 events; HR 1.92, 1.27-2.89) and all-cause death (19 vs seven events; HR 2.76, 1.16-6.56) were higher in the stenting group than in the endarterectomy group. Three procedural myocardial infarctions were recorded in the stenting group, all of which were fatal, compared with four, all non-fatal, in the endarterectomy group. There was one event of cranial nerve palsy in the stenting group compared with 45 in the endarterectomy group. There were also fewer haematomas of any severity in the stenting group than in the endarterectomy group (31 vs 50 events; p=0.0197). INTERPRETATION: Completion of long-term follow-up is needed to establish the efficacy of carotid artery stenting compared with endarterectomy. In the meantime, carotid endarterectomy should remain the treatment of choice for patients suitable for surgery. FUNDING: Medical Research Council, the Stroke Association, Sanofi-Synthélabo, European Union.

Correlation of O6-methylguanine methyltransferase (MGMT) promoter methylation with clinical outcomes in glioblastoma and clinical strategies to modulate MGMT activity.

Resistance to alkylating agents via direct DNA repair by O(6)-methylguanine methyltransferase (MGMT) remains a significant barrier to the successful treatment of patients with malignant glioma. The relative expression of MGMT in the tumor may determine response to alkylating agents, and epigenetic silencing of the MGMT gene by promoter methylation plays an important role in regulating MGMT expression in gliomas. MGMT promoter methylation is correlated with improved progression-free and overall survival in patients treated with alkylating agents. Strategies to overcome MGMT-mediated chemoresistance are being actively investigated. These include treatment with nontoxic pseudosubstrate inhibitors of MGMT, such as O(6)-benzylguanine, or RNA interference-mediated gene silencing of MGMT. However, systemic application of MGMT inhibitors is limited by an increase in hematologic toxicity. Another strategy is to deplete MGMT activity in tumor tissue using a dose-dense temozolomide schedule. These alternative schedules are well tolerated; however, it remains unclear whether they are more effective than the standard dosing regimen or whether they effectively deplete MGMT activity in tumor tissue. Of note, not all patients with glioblastoma having MGMT promoter methylation respond to alkylating agents, and even those who respond will inevitably experience relapse. Herein we review the data supporting MGMT as a major mechanism of chemotherapy resistance in malignant gliomas and describe ongoing studies that are testing resistance-modulating strategies.

Wechsel von einem mechanischen Mikrokeratom auf einen Femtosekunden-Laser zur Korrektur von Astigmatismus mittels LASIK: klinische Ergebnisse einer retrospektiven, konsekutiven Vergleichsstudie Moving from a Mechanical Microkeratome to a Femtosecond Laser for LASIK to Correct Astigmatic Patients: Clinical Outcomes of a Retrospective, Consecutive, Comparative Study.

Background: To evaluate outcomes after optimized laser in situ keratomileusis (LASIK) for astigmatism correction with flap created by a mechanical microkeratome or a femtosecond laser. Patients and Methods: In this retrospective study, a total of 102 eyes of 71 consecutive patients were enrolled undergoing optimized LASIK treatments using the Allegretto laser system (WaveLight Laser Technologie AG, Erlangen, Germany). A mechanical microkeratome for flap creation was used (One Use, Moria®) in 46 eyes (31 patients, spherical equivalent [SE] -4.44 D ± 2.4) and a femtosecond laser was used (LDV, Ziemer®) in 56 eyes (40 patients, spherical equivalent [SE] -3.07 D ± 3.3). The two groups were matched for inclusion criteria and were operated under similar conditions by the same surgeon. Results: Overall, the preoperative spherical equivalent was -9.5 diopters (D) to +3.37 D; the preoperative manifest astigmatism was between -1.5 D and -3.5 D. At 6 months postoperatively, the mean postoperative uncorrected distance visual acuity (UDVA) was 0.93 ± 0.17 (range 0.4 to 1.2) in the Moria group and 1.0 ± 0.21 (range 0.6 to 1.6) in the Femto group, which was statistically significant (p = 0.003). Comparing the cylinder power there was a statistical difference between the two groups (p = 0.0015). Conclusions: This study shows that the method of flap creation has a significant impact on postoperative astigmatism with a significantly better postoperative UDVA in the Femto group. These findings suggest that the femtosecond laser provides a better platform for LASIK treatment of astigmatism than the commonly used microkeratome.