Violently Possessed: Johnson as the Vehicle for limiting Sentencing Enhancement under the Armed Career Criminals Act

This commentary previews an upcoming Supreme Court case, Johnson v. United States in which the Court will decide whether conviction for mere possession of a short-barreled shotgun qualifies as a violent felony that warrants sentence-enhancement under the Armed Career Criminals Act. The Author argues that he plain text of the statute and the Court\u27s prior cases on the issue suggest tat convictions for mere possession do not satisfy the definition of violent felony and that the Court should overturn the Eighth Circuit\u27s ruling upholding Johnson\u27s sentence enhancement

Demutualization and enforcement incentives at self-regulatory financial exchanges

n the last few years, many of the world’s largest financial exchanges have converted from mutual, not-for-profit organizations to publicly-traded, for-profit firms. In most cases, these exchanges have substantial responsibilities with respect to enforcing various regulations that protect investors from dishonest agents. We examine how the incentives to enforce such regulations change as an exchange converts from mutual to for-profit status. In contrast to oft-stated concerns, we find that, in many circumstances, an exchange that maximizes shareholder (rather than member) income has a greater incentive to aggressively enforce these types of regulations

The Potential of Foreign Aid as Insurance

This paper quantifies the potential of foreign aid as an insurance mechanism against macroeconomic shocks. Within a dynamic model of aid flows between two endowment economies, we show that at least three-fourths of the large welfare costs of macroeconomic fluctuations in poor countries could be alleviated by a simple reallocation of aid flows across time. In developing countries subject to persistent macroeconomic shocks, the resulting welfare improvement is of first-order magnitude. Copyright 2006, International Monetary Fund

The Welfare Costs of Macroeconomic Fluctuations under Incomplete Markets: Evidence from State-Level Consumption Data

Existing estimates of the welfare cost of business cycles suggest that it is quite low and might well be minuscule. Many of these estimates are based on aggregated U.S. consumption data. Arguably, because markets are incomplete and risk-sharing is imperfect, the welfare costs computed with aggregate consumption data are likely underestimates. Yet, incomplete-market models have not yielded significantly greater cost figures. Previous incomplete-market studies, however, have relied on model-generated consumption series that reflect optimal decsions in models calibrated using individual income data. In this paper, we maintain the assumption of incomplete markets but use observed consumption streams instead. Using state-level retail sales figures, we show that the welfare cost of macroeconomic volatility is in fact very substantial. In one half of the U.S. states, the welfare gain from the removal of business cycles can in fact exceed the gain from receiving an extra percentage point of consumption growth in perpetuity. In short, our results indicate that macroeconomic volatility has first-order welfare implications.Incomplete markets, consumption volatility, growth, welfare

Regional Financial Interlinkages and Financial Contagion within Europe

The ongoing global financial turmoil has increased the importance of understanding the potential spillover effects brought about by financial interlinkages. This article focuses on such interlinkages within Europe and potential contagion channeled through these interlinkages. It discusses the increased role of external financing as a source of funding for credit growth before the turmoil; analyzes potential channels of contagion through financial linkages; and assesses the magnitude of cross-border exposures between emerging and advanced European economies. Based on the stylized facts on these exposures, the article provides indices of exposure to regional contagion that could help identify the likely pressure points and capture potential spillover effects and propagation channels of a regional shock originating from a given country.financial linkages, contagion, cross-border flows, spillover effects, credit growth, Central Eastern Southeastern Europe

Mixed-Race Studies; Misstep or the next step for Ethnic Studies in a blending nation?

In January of 2011, the New York Times reported that 2010 U.S. Census data shows that younger generations are self-reporting their racial identity as multiracial or mixed-race in higher numbers than ever before¹. Classes in higher education that engage with race and ethnicity, often but not always as part of Ethnic Studies programs in universities, discuss and critique the categorizations of race and ethnicity. However, there is a social, political and economic power and privilege that groups have in being recognized as part of a categorized racial and/or ethnic group that mixedrace or multiracial identified individuals do not have when their identity is underrepresented or unrepresented. There is a very small number (under ten) universities in the U.S. that offer courses or programs that focus their study on a mixed-race identity. The potential problem in this change is a growing mixed-race identified population is the possibility that a growing number of students in classes that will not find a curriculum that centers on their racial experiences. That is the question I will address - are the racial experiences and understandings of mixed-race identified people being addressed in classes that engage with and critique race? I survey a small sample of students currently enrolled in classes which engage with race and ethnicity at Oregon universities about their racial experiences to find out if they see mixed-race studies as having a place in the future of ―Ethnic Studies‖ classes in higher education. Faculty Mentor: Dr. Ann Musse

Leland & Pyle Meet Foreign Aid? Adverse Selection and the Procyclicality of Financial Aid Flows

Official development assistance (grants and subsidized loans from foreign aid agencies) is the main source of external finance in developing countries. These financial aid flows are positively correlated with the recipients' business cycles, which is puzzling because it reinforces already strong and costly macroeconomic fluctuations in the recipient countries. We propose an explanation related to a familiar corporate finance theory of inside equity commitments. We assume that donor agencies and recipient governments value projects differently, and that donors know less than recipients do about projects. We show that donors can make an aid recipient idientify high-return projects by conditioning aid on the recipient's committing some of its own funds to the selected projects. This commitment makes recommending bad projects costly. Contributing "counterpart funds" is more difficult during economic downturns, however - which leads to aid procyclicality. This simple model of investment financing and aid provision produces aid contracts consistent with those used by aid agencies, rationalizes observed aid flow patterns, and yields a rich set of testable empirical predictions.Aid, Altruism, Adverse selection, Counterpart funds, Capital flow procyclicality

FOREIGN AID AND THE BUSINESS CYCLE

In this paper, we document some key business cycle properties of foreign aid flows to developing countries. We identify two striking empirical regularities. First, aid flows are highly volatile over time -- on average, two to three times as volatile as the recipient's output. Second, for most African countries, net aid inflows are strongly positively correlated with their domestic output. Outside of Africa, we find a similar, if somewhat less pronounced, pattern of aid procyclicality.To see why these empirical regularities are important, recall that output fluctuations in developing countries are much stronger than in industrialized economies. Indeed, we document that the gross domestic product of an aid recipient is on average six times as volatile as that of a donor. For developing countries, though, customary ways to smooth out the impact of output fluctuations on domestic consumption are likely to be very onerous. For instance, moral hazard and repudiation risk imply that heavily indebted nations are often denied new loans (or are asked to repay old ones) precisely when their economies suffer adverse shocks -- see, e.g., Atkeson-1991). At the same time, foreign aid is a sizeable source of income to recipients, especially in Africa, where it averages 12.5% of gross domestic product and constitutes the main source of foreign capital. In such an environment, foreign aid flows have the potential to play a key role in smoothing out developing countries' output fluctuations. Our results imply that, all in all, aid does not play that role.Admittedly, it might be argued that, except for emergency relief, the chief purpose of foreign aid is not to act as an insurance device but, instead, to fuel economic development, in which case it is not clear a priori whether one should expect aid flows to be procyclical or countercyclical. It is well known, however, that output fluctuations affect growth negatively -- see, e.g., Hamilton (1989) and Ramey&Ramey (1995). Hence, even if aid were meant solely to help foster growth, serious concerns should nonetheless arise from the fact that aid disbursement patterns contribute to the volatility of developing countries' disposable income.Our findings are robust. Our data set comprises various yearly aid and output series for sixty-three recipient and eighteen donor countries between 1969 and 1995. We find few differences between the cyclical behavior of multilateral as opposed to bilateral aid disbursements, even though multilateral aid flows are relatively more volatile than their bilateral counterparts. Likewise, aid commitments fluctuate more than actual net disbursements, but both commitments and disbursements are procyclical. We also pay special attention to Africa, because it is the region where aid is largest relative to recipient GDP and aid procyclicality is most striking. We show that, regardless of the domestic output measure used, net aid receipts are procyclical for at least two-thirds of the thirty-eight countries in our African subsample and are countercyclical for, at most, two of them. Key components of African aid, such as grants or technical assistance, are as strongly procyclical as total aid flows. Finally, we can find no evidence that, among African countries, the procyclicality of aid might be a function of the recipient's former colonial power, choice of exchange rate regime or some other criterion.We complete the paper by analyzing the cyclical properties of aid flows from the donors' perspective. For almost all donor countries, we find that total aid disbursements are strongly positively correlated with the donor's output. In a clear majority of cases, however, those same donors' bilateral aid flows to the sample countries are not positively correlated with the donor's output. A corollary is that the procyclicality of aid inflows experienced by aid recipients is not the mere result of the conjunction of (i) positive comovements between North-South business cycles [Kouparitsas (1998); Agenor&Prasad (1999)] and (ii) a positive correlation between donors' aid policies and their business cycles.

Outcomes Based Assessment of Universities

This study summarizes recent and continuing research conducted by the Center for College Affordability and Productivity (CCAP) on the metrics used for measuring college performance. Unlike other rankings, this study does not concentrate on the inputs of college education such as endowment size, number of faculty, or the educational preparation of students as measured by SAT scores, etc. Instead, it focuses on the outputs, namely the success of students after graduation. Using the names of entrants in Marquis Publishing's 2008 edition of Who's Who in America as our standard for measuring high levels of success, we collected the names of over 5,200 individuals, along with their educational background.This is more than a 5 percent sampling of all names listed in this standard reference work. From this sample, we then calculated which colleges produced the most successful graduates. The results thus far have been both fascinating and surprising.We have found that while going to top ranked schools as measured by standard college rankings does correlate with success, it is a weaker relationship than many may have previously believed. The study reveals that the "industry standard," U.S. News & World Report (USNWR) rankings, on the whole, is only weakly related to graduate success. This suggests that the characteristics contributing to the value of a student's education differ substantially from what is typically assumed. The goal of this study is not to serve as a definitive source for ranking and comparing colleges. Rather, the research presented herein will hopefully serve as both an impetus and road ma

On the Potential of Foreign Aid as Insurance

In this paper, we argue that it would be fruitful to revisit foreign aid's potential as an insurance mechanism against macroeconomic shocks. In a simple model of aid flows between two endowment economies, we show that at least three fourths of the large welfare costs of macroeconomic fluctuations in poor countries could be alleviated by a simple reallocation of aid flows across time.Foreign aid, Consumption smoothing, Macroeconomic fluctuations, Welfare