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Banks and bonds: the impact of bank loan announcements on bond and equity prices

We study the effect of bank loan announcements on the borrowing firms' bond and equity prices. Our sample consists of 896 loan deals signed between 1997 to 2003 involving 364 different US firms. We report the first comprehensive evidence that also firm bond prices react to bank loan announcements. Using a two-day event window, we find significant abnormal bond credit spreads...

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English / 01/02/2014

The causal effect of house prices on mortgage demand and mortgage supply

We identify the causal effect of house prices on mortgage demand and supply in Switzerland by exploiting exogenous shocks to immigration and thereby to house prices. Detailed micro data allow us to observe multiple offers for each mortgage request. We find a 1% increase in house prices to raise the requested mortgage amount by 0.52%. Due to positive feedback effects, the entire...

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English / 01/02/2014

Drug-specific laterality effects on frontal lobe activation of atomoxetine and methylphenidate in attention deficit hyperactivity disorder boys during working memory

Background The catecholamine reuptake inhibitors methylphenidate (MPH) and atomoxetine (ATX) are the most common treatments for attention deficit hyperactivity disorder (ADHD). This study compares the neurofunctional modulation and normalization effects of acute doses of MPH and ATX within medication-naive ADHD boys during working memory (WM).

Method A total of 20 medication-...

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English / 01/02/2014

The promise of microfinance and women's empowerment: what does the evidence say?

The microfinance revolution has transformed access to financial services for low-income populations worldwide. As a result, it has become one of the most talked-about innovations in global development in recent decades. However, its expansion has not been without controversy. While many hailed it as a way to end world poverty and promote female empowerment, others condemned it as a...

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English / 01/02/2014

Unternehmen, Menschenrechte und Global Governance: Zur Umsetzung von Compliance auf Unternehmensebene

Wie die Unternehmenspraxis zeigt, greifen Compliance und CSR ineinander und werden regelmäßig gemeinsam betrachtet. Der Tagungsband vereint die aktuelle Diskussion dieser Themen, indem er die Idee von Compliance mit geltendem Recht mit der Forderung nach freiwilliger Mehrverantwortung im Sinne von CSR zusammenführt und die aktuellen Fragestellungen der Unternehmenspraxis mit der...

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Deutsch / 01/02/2014

Can utility optimization explain the demand for structured investment products?

In this paper, we first show that for classical rational investors with correct beliefs and constant absolute or constant relative risk aversion, the utility gains from structured products over and above a portfolio consisting of the risk-free asset and the market portfolio are typically much smaller than their fees. This result holds irrespectively of whether the investors can...

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English / 30/01/2014

Sacred values: Trade-off type matters

Previous psychological investigations revealed that sacred values (SVs; the belief that certain values are nonsubstitutable and may not be traded off, in particular, against secular economic values) modulates moral decision making depending on the type of SV infringement involved. Extending this research, we compared neurofunctional correlates determined from fMRI measurements during...

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English / 27/01/2014

Frontopolar cortex and decision-making efficiency: comparing brain activity of experts with different professional background during an exploration-exploitation task

An optimal balance between efficient exploitation of available resources and creative exploration of alternatives is critical for adaptation and survival. Previous studies associated these behavioral drives with, respectively, the dopaminergic mesocorticolimbic system and frontopolar-intraparietal networks. We study the activation of these systems in two age and gender-matched groups...

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English / 22/01/2014

Functional changes of the reward system underlie blunted response to social gaze in cocaine users

Social interaction deficits in drug users likely impede treatment, increase the burden of the affected families, and consequently contribute to the high costs for society associated with addiction. Despite its significance, the neural basis of altered social interaction in drug users is currently unknown. Therefore, we investigated basal social gaze behavior in cocaine users by...

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English / 21/01/2014

Private provision of public goods and asset prices

In capitalist societies it is the role of the state to establish the preconditions that promote societal well-being through proper functioning markets.
On the other hand enterprises have a right to provide goods and services in return for private profit. This sharp contrast between government and corporate responsibilities is created by a theoretical idealized first-best world...

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English / 01/01/2014

Reinsurance or Securitization: The Case of Natural Catastrophe Risk

We investigate the suitability of securitization as an alternative to reinsurance for the purpose of transferring natural catastrophe risk. We characterize the conditions under which one or the other form of risk transfer dominates using a setting in which reinsurers and traders in financial markets produce costly information about catastrophes. Such information is useful to insurers...

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English / 01/01/2014

Bankruptcy triggering asset value–continuous time finance approach

This paper utilizes means of game theory and option pricing to compute a bankruptcy triggering asset value. Combination of these two fields of economic study serves to separating the given problem into valuation of the payoffs, where we use option pricing and the analysis of strategic interactions between parties of a contract which could be designed and solved with the use of game...

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English / 01/01/2014

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