Jaap W.B. Bos

Handling Losses in Translog Profit Models

In this article, we compare standard approaches used to handle losses in logarithmic profit models with a simple novel approach. We estimate translog stochastic profit frontiers, and discuss discriminatory power, rank stability and the precision of Profit Efficiency (PE) scores. Contrary to existing methods, our approach does not result in a loss of observations. Our new method enhances rank stability and discriminatory power, and improves the precision of PE scores.

A silent antipode: The making and breaking of psychoanalyst Wilhelm Stekel.

Wilhelm Stekel, one of Freuds earliest followers , was expelled from the psychoanalytic movement in 1912 ostensibly because he did not know how to behave himself. Although he remained active as a psychoanalyst, his post-1912 work was mostly neglected, and consequently his historic import is seriously undervalued. The author reviews recent literature, reexamines the Freud-Stekel break, and focuses on Stekels role as silent antipode. Freuds reference to an unnamed individual in his 1907 Gradiva paper (S. Freud, 1907/1959b) - commonly believed to be Jung - is now identified as Stekel. This not - unimportant correction of the historical record begins the exploration of a hitherto-undocumented antagonistic dialogue between Stekel and Freud.

Do Technology and Efficiency Differences determine Productivity

This paper investigates the forces driving output growth, namely technological, efficiency, and input changes, in 80 countries over the period 1970-2000. Relevant past studies typically assume that: (i) countries use resources efficiently, and (ii) the underlying production technology is the same for all countries. We address these issues by estimating a stochastic frontier model, which explicitly accounts for inefficiency, augmented with a latent class structure, which allows for production technologies to differ across groups of countries. Membership of these groups is estimated, rather than determined ex ante. Our results indicate the existence of three groups of countries. These groups differ significantly in terms of efficiency levels, technological change, and the development of capital and labor elasticities. However, a consistent finding across groups is that growth is driven mainly by factor accumulation (capital deepening).

Show Me Yours and I'll Show You Mine: Sharing Borrower Information in a Competitive Credit Market

We exploit detailed data on approved and rejected small business loans to assess the impact of the introduction of a credit registry in Bosnia and Herzegovina. Our findings are threefold. First, mandatory information sharing tightens lending at the extensive margin as more applications are rejected, in particular in areas with strong credit market competition. These rejections are increasingly based on hard information—especially positive borrower information from the new registry—and less on soft information. Second, lending standards also tighten at the intensive margin: the registry leads to smaller, shorter and more expensive loans. Third, the tightening of lending along both margins improves loan quality. Default rates go down in particular in high competition areas and for first-time borrowers. This suggests that a reduction in adverse selection is an important channel through which information sharing affects loan quality.

Acts of betrayal. Reading the letters of Wilhelm Stekel to Sigmund Freud

Abstract This paper presents a discussion of the previously unpublished correspondence between Stekel and Freud. The authors start with a brief overview of most important historic events and facts that constitute the context against which these letters should be read. The matters cover questions of publishing policy, personal priorities, and psychoanalytic principles. The authors suggest that the Stekel letters may have been preserved by Freud as evidence of the latters estrangement from him, as tokens of betrayal. A minute discussion of the correspondence makes it possible to discuss day-to-day developments in this fateful relation, taking into account Stekels side of the story for the first time as well, highlighting the backfiring of a strategic maneuver by Stekel to psychoanalyse the Freud family, which heralded his downfall, and also revealing the role that Victor Tausk played in this. The paper concludes with a discussion of the dialectics of estrangement.

Competition, concentration and critical mass: why the Herfindahl–Hirschman Index is a biased competition measure

Empirical literature and related legal practice using concentration as a proxy for competition measurement are prone to a fallacy of division, as concentration measures are appropriate for perfect competition and perfect collusion but not intermediate levels of competition. Extending the classic Cournot model used to derive the Hirschman–Herfindahl Index (HHI) of market concentration, we propose an adaptation of this model intended to remove the aggregation bias and omitted variable bias that exist in many empirical studies. Application of our model and new critical mass measures to data for US commercial banks in the period 1984–2013 confirms that concentration measures are indeed unreliable competition metrics. Our results lead us to conclude that critical mass builds upon HHI as a market power metric that incorporates competitive information not contained in HHI. Policy and future research implications are briefly discussed.

Self-Regulation in Collaborative Environments: The Case of the Equator Principles in Banking

Using banks in the syndicated lending market, we discuss a firm-specific strategy that has been overlooked by the literature, namely, that self-regulated firms pressure other non-self-regulated firms in an attempt to reduce effort asymmetries when collaborating. We develop a framework that shows when such a strategy is likely to be present. This framework is built on the view that the costs and benefits of collaboration are equally shared among self-regulated firms that collaborate. However, when self-regulated firms collaborate with non-self-regulated firms, the effort they exert differs and is not equally shared. In particular, we find that when firms collaborate, self-regulated firms pressure non-self-regulated firms to become self-regulated with the purpose of reducing effort asymmetries, and such a pressure increases with the duration of the collaboration.