This paper presents a new model for pricing OTC derivatives subject to collateralization. It allows for collateral posting adhering to bankruptcy laws. As such, the model can back out the market price of a collateralized contract. This framework is very useful for valuing outstanding derivatives. Using a unique dataset, we find empirical evidence that credit risk alone is not overly important in determining credit-related spreads. Only accounting for both collateral arrangement and credit risk can (...) sufficiently explain unsecured credit costs. This finding suggests that failure to properly account for collateralization may result in significant mispricing of derivatives. We also empirically gauge the impact of collateral agreements on risk measurements. Our findings indicate that there are important interactions between market and credit risk. (shrink)

Credit risk, also known as default risk, is the likelihood of a corporation losing money if a business partner defaults. If the liabilities are not met under the terms of the contract, the firm may default, resulting in the loss of the company. There is no clear way to distinguish between organizations that will default and those that will not prior to default. We can only make probabilistic estimations of the risk of default at best. (...) There are two types of credit risk default models in this regard: structural and reduced-form models. Structural models are used to calculate the likelihood of a company defaulting based on its assets and liabilities. If the market worth of a company's assets is less than the debt it owes, it will default. Reduced form models often assume an external cause of default, such as a Poisson jump process, which is driven by a stochastic process. They model default as a random event with no regard for the balance sheet of the company. This paper provides a Review of credit risk default models. (shrink)

Credit risk, also known as default risk, is the likelihood of a corporation losing money if a business partner defaults. If the liabilities are not met under the terms of the contract, the firm may default, resulting in the loss of the company. There is no clear way to distinguish between organizations that will default and those that will not prior to default. We can only make probabilistic estimations of the risk of default at best. (...) There are two types of credit risk default models in this regard: structural and reduced form models. Structural models are used to calculate the likelihood of a company defaulting based on its assets and liabilities. If the market worth of a company's assets is less than the debt it owes, it will default. Reduced form models often assume an external cause of default, such as a Poisson jump process, which is driven by a stochastic process. They model default as a random event with no regard for the balance sheet of the company. This paper provides a Review of credit risk default models. (shrink)

This article presents a comprehensive framework for valuing financial instruments subject to credit risk. In particular, we focus on the impact of default dependence on asset pricing, as correlated default risk is one of the most pervasive threats in financial markets. We analyze how swap rates are affected by bilateral counterparty credit risk, and how CDS spreads depend on the trilateral credit risk of the buyer, seller, and reference entity in a contract. Moreover, (...) we study the effect of collateralization on valuation, since the majority of OTC derivatives are collateralized. The model shows that a fully collateralized swap is risk-free, whereas a fully collateralized CDS is not equivalent to a risk-free one. (shrink)

This paper attempts to assess the economic significance and implications of collateralization in different financial markets, which is essentially a matter of theoretical justification and empirical verification. We present a comprehensive theoretical framework that allows for collateralization adhering to bankruptcy laws. As such, the model can back out differences in asset prices due to collateralized counterparty risk. This framework is very useful for pricing outstanding defaultable financial contracts. By using a unique data set, we are able to achieve a (...) clean decomposition of prices into their credit risk factors. We find empirical evidence that counterparty risk is not overly important in credit-related spreads. Only the joint effects of collateralization and credit risk can sufficiently explain unsecured credit costs. This finding suggests that failure to properly account for collateralization may result in significant mispricing of financial contracts. We also analyze the difference between cleared and OTC markets. (shrink)

This paper explores the notion that business calls for an adversarial ethic, akin to that of sport. On this view, because of their competitive structure, both sport and business call for behaviours that are contrary to ‘ordinary morality’, and yet are ultimately justified because of the goods they facilitate. I develop three objections to this analogy. Firstly, there is an important qualitative difference between harms risked voluntarily and harms risked involuntarily. Secondly, the goods achieved by adversarial relationships in sport (...) go beyond the function of sport, i.e. to entertain audiences. Thirdly, the most plausible account of the athlete’s motivational development starts with their love of the sport, which can explain a commitment to the sporting ethics in a way that is not paralleled in business. I close by drawing attention to the ways in which an Aristotelian conception of business ethics may be able to accommodate these objections. (shrink)

This article presents a generic model for pricing financial derivatives subject to counterparty credit risk. Both unilateral and bilateral types of credit risks are considered. Our study shows that credit risk should be modeled as American style options in most cases, which require a backward induction valuation. To correct a common mistake in the literature, we emphasize that the market value of a defaultable derivative is actually a risky value rather than a risk-free (...) value. Credit value adjustment (CVA) is also elaborated. A practical framework is developed for pricing defaultable derivatives and calculating their CVAs at a portfolio level. (shrink)

This article presents a new model for valuing financial contracts subject to credit risk and collateralization. Examples include the valuation of a credit default swap (CDS) contract that is affected by the trilateral credit risk of the buyer, seller and reference entity. We show that default dependency has a significant impact on asset pricing. In fact, correlated default risk is one of the most pervasive threats in financial markets. We also show that a fully (...) collateralized CDS is not equivalent to a risk-free one. In other words, full collateralization cannot eliminate counterparty risk completely in the CDS market. (shrink)

This paper presents a new model for valuing hybrid defaultable financial instruments, such as, convertible bonds. In contrast to previous studies, the model relies on the probability distribution of a default jump rather than the default jump itself, as the default jump is usually inaccessible. As such, the model can back out the market prices of convertible bonds. A prevailing belief in the market is that convertible arbitrage is mainly due to convertible underpricing. Empirically, however, we do not (...) find evidence supporting the underpricing hypothesis. Instead, we find that convertibles have relatively large positive gammas. As a typical convertible arbitrage strategy employs delta-neutral hedging, a large positive gamma can make the portfolio highly profitable, especially for a large movement in the underlying stock price. (shrink)

This article presents a new model for valuing a credit default swap (CDS) contract that is affected by multiple credit risks of the buyer, seller and reference entity. We show that default dependency has a significant impact on asset pricing. In fact, correlated default risk is one of the most pervasive threats in financial markets. We also show that a fully collateralized CDS is not equivalent to a risk-free one. In other words, full collateralization cannot eliminate (...) counterparty risk completely in the CDS market. (shrink)

This paper argues that the reduced-form jump diffusion model may not be appropriate for credit risk modeling. To correctly value hybrid defaultable financial instruments, e.g., convertible bonds, we present a new framework that relies on the probability distribution of a default jump rather than the default jump itself, as the default jump is usually inaccessible. As such, the model can back out the market prices of convertible bonds. A prevailing belief in the market is that convertible (...) arbitrage is mainly due to convertible underpricing. Empirically, however, we do not find evidence supporting the underpricing hypothesis. Instead, we find that convertibles have relatively large positive gammas. As a typical convertible arbitrage strategy employs delta-neutral hedging, a large positive gamma can make the portfolio highly profitable, especially for a large movement in the underlying stock price. (shrink)

This chapter argues for deregulation of the credit-rating market. Credit-rating agencies are supposed to contribute to the informational needs of investors trading bonds. They provide ratings of debt issued by corporations and governments, as well as of structured debt instruments (e.g. mortgage-backed securities). As many academics, regulators, and commentators have pointed out, the ratings of structured instruments turned out to be highly inaccurate, and, as a result, they have argued for tighter regulation of the industry. This chapter (...) shows, however, that the role of credit-rating agencies in achieving justice in finance is not as great as these commentators believe. It therefore argues instead for deregulation. Since the 1930s, lawgivers have unjustifiably elevated the rating agencies into official, legally binding sources of information concerning credit risk, thereby unjustifiably causing many institutional investors to outsource their epistemic responsibilities, that is, their responsibility to investigate credit risk themselves. (shrink)

The paper explores the influence of greenwash on green trust and discusses the mediation roles of green consumer confusion and green perceived risk. The research object of this study focuses on Taiwanese consumers who have the purchase experience of information and electronics products in Taiwan. This research employs an empirical study by means of the structural equation modeling. The results show that greenwash is negatively related to green trust. Therefore, this study suggests that companies must reduce their greenwash behaviors (...) to enhance their consumers’ green trust. In addition, this study finds out that green consumer confusion and green perceived risk mediate the negative relationship between greenwash and green trust. The results also demonstrate that greenwash is positively associated with green consumer confusion and green perceived risk which would negatively affect green trust. It means that greenwash does not only negatively affect green trust directly but also negatively influence it via green consumer confusion and green perceived risk indirectly. Hence, if companies would like to reduce the negative relationship between greenwash and green trust, they need to decrease their consumers’ green consumer confusion and green perceived risk. (shrink)

Humans often unconsciously perceive social robots involved in their lives as partners rather than mere tools, imbuing them with qualities of companionship. This anthropomorphization can lead to a spectrum of emotional risks, such as deception, disappointment, and reverse manipulation, that existing approaches struggle to address effectively. In this paper, we argue that a Virtual Interactive Environment (VIE) exists between humans and social robots, which plays a crucial role and demands necessary consideration and clarification in order to mitigate potential emotional (...) risks. By analyzing the relational nature of human-social robot interaction, we discuss the connotation of such a virtual interactive environment that is similar to the emotional states aroused when reading novels. Building on this comprehension, we further demonstrate that manufacturers should carry out comprehensive Virtual Interactive Environment Indication (VIEI) measures during human-social robot interaction with a stricter sense of responsibility when applying social robots. Finally, we contemplate the potential contributions of virtual interactive environment indication to existing robot ethics guidelines. (shrink)

This article presents an ethical analysis and critique of personalized service in the tradition of Catholic social teaching (CST) that is both Catholic and Personalist. It tackles the ethical issues involved when service delivery is personalized, issues that affect both the consumers and the service providers. It focuses on nonprofessional services that are offered by low-skilled blue-collar workers through corporations that are organized to produce efficient service to a high volume of consumers. Customer service involves intersubjectivity, that is, interaction (...) between two persons as subjects. Ethics in the service context is not only about treating consumers in a just manner; the threats to the personhood of the service providers are also significant, for their work cannot be separated from their very being. By focusing on the ethical issues of emotional labor and consumerism of human service, the study will argue that the human interaction in personalized service runs the risk of alienating us from our authentic selves and from each other. If the objective of personalized service is to create authentic human relationship in the service encounter, the latter can arise even in a nonpersonalized service. We do not have to personalize our actions in order to create genuine human interaction. Instead, what we must do is to treat each other as persons. (shrink)

The EU proposal for the Artificial Intelligence Act (AIA) defines four risk categories: unacceptable, high, limited, and minimal. However, as these categories statically depend on broad fields of application of AI, the risk magnitude may be wrongly estimated, and the AIA may not be enforced effectively. This problem is particularly challenging when it comes to regulating general-purpose AI (GPAI), which has versatile and often unpredictable applications. Recent amendments to the compromise text, though introducing context-specific assessments, remain insufficient. To (...) address this, we propose applying the risk categories to specific AI scenarios, rather than solely to fields of application, using a risk assessment model that integrates the AIA with the risk approach arising from the Intergovernmental Panel on Climate Change (IPCC) and related literature. This model enables the estimation of the magnitude of AI risk by considering the interaction between (a) risk determinants, (b) individual drivers of determinants, and (c) multiple risk types. We use large language models (LLMs) as an example. (shrink)

Firstly, the "Metaverse" possesses two distinctive features, "thickness" and "imagination," promising the public a structure of unknown scenarios but with unclear definitions. Attempts to establish an open framework through incompleteness, however, fail to facilitate interactions between humans and the scenario. Due to the dilemma of "digital twinning," the "Metaverse" cannot be realized as "another universe". Hence, the "Metaverse" is, in fact, only a virtual experiential territory created by aggregating technologies that offer immersion and interactivity. Secondly, when artificial intelligence serves (...) as a key supporting technology for the "Metaverse," it presents multifaceted existential risks, manifested as safety, cognitive, and ethical dilemmas. Finally, we propose that the framework for responsible "Metaverse" governance should be constructed through three pathways: collective responsibility, realism, and the co-governance of the virtual and real. (shrink)

Understanding the relationship between experts and laypeople is crucial for understanding today’s world of post-truth and the contemporary crisis of liberal democracy. The emergence of post-truth has been linked to various phenomena such as a flawed social and mass media ecosystem, poor citizen education, and the manipulation tactics of powerful interest groups. The paper argues that the problem is, however, more profound. The underlying issue is laypeople’s inevitable epistemic dependence on experts. The latter is part and parcel of the (...) “risk society” in which people question the scientific consensus and thus are able to manipulate the facts. It is a powerful weapon in the hands of illiberal democrats, though liberal democrats can make no use of it. The latter downplay the problem of citizens’ epistemic deficits and of the epistemic asymmetries between them. The third and fourth generations of deliberative democrats are a perfect example. The paper argues that the concepts of interactional expertise and epistemic dependence explain why understanding between experts and laypeople is impossible. The said phenomena undermine liberalism’s unrealistic assumptions concerning citizens’ decision-making competence. (shrink)

Can taxation and the redistribution of wealth through the welfare state be conceived as a modern system of circulation of the gift? But once such a gift is institutionalized, regulated and sanctioned through legal mechanisms, does it not risk being perverted or corrupted, and/or not leaving room for genuinely altruistic motives? What is more: if the market’s utilitarian logic can corrupt or ‘crowd out’ altruistic feelings or motivations, what makes us think that the welfare state cannot also be (...) a source of corruption? To explain the standard answers to the abovementioned questions as well as their implications I will first re-examine two opposing positions assumed here as paradigmatic examples of other similar positions: on the one hand, Titmuss’s work and the never-ending debate about it; on the other, Godbout’s position, in-so-far as it shows how Titmuss’s arguments can easily be turned upside down. I will then introduce and reinterpret Einaudi’s “critical point” theory as a more complex and richer anthropological explanation of the problems and answers considered herein. Through the analysis of these paradigmatic positions I will develop two interrelated arguments. 1) The way these problems are posed as well as the standard answers to them are: a) subject to fallacies: the dichotomy fallacy and the fallacy of composition; b) too reductive and simplistic: we should at least try to clarify what kind of ‘gift’ or ‘corruption’ we are thinking about, and who or what the ‘giver’, the ‘corrupter’, the ‘receiver’ and/or the ‘corrupted’ party are. 2) The answers to these problems cannot be found by merely following a theoretical approach, nor can they be merely based on empirical evidence; instead, they need to take into account the forever troublesome, ambiguous and unpredictable matter of human freedom. (shrink)

According to the classical finance theory it is assumed that investors show rational behaviour in order to achieve maximum gain.but this approach has changed since 1980s. There are a lot of academic studies emphasizing the determining effect of human psychology in financial decisions. Behavioral finance considers the interaction between emotions and investors decisions. According to the New financial approach investors show irrational behaviours and take prejudices into the account for investment decisions as opposed to traditional perspective. Behavioral finance (...) analyzes the market anomalies which conventional financial theories are inadequate to explain based on an assumption that individuals are not rational. While doing this, it benefits from the other sciences such as psychology, sociology, and antropology, etc. One type of behavioral finance is herd behavior. In this paper, domestic and foreign literature research on herd behavior in financial markets were analyzed. (shrink)

The endurance of depression, anxiety and suicidal ideation among gay and bisexual men persists despite advances in civil rights and wider social acceptance. While minority stress theory provides a framework for much scholarly debate as to the causes of mental distress among non-heterosexual men, there is a growing interest into the detrimental effects that competitiveness within the gay community itself can have. Past studies have celebrated involvement in gay culture as being associated with better mental health outcomes by tempering the (...) impact of hegemonic heteronormativity. Yet between non-heterosexual men and the general population, there are stark mental health inequalities that require investigation. As a means of proving manhood, men in general are predisposed toward competitiveness and risk, but within a subculture where the attention is exclusively on male sex, the focus is primarily status conscious. This article draws on minority stress theory to consider societal discrimination. It also applies inter-minority gay community stress theory to explore pressures emanating from gay spaces with fixations on masculinity, income and rivalry as major sources of mental health problems in gay and bisexual men. The causes for health disparities illustrated in this article, demonstrate a critical need for public health and social care organizations to respond with innovatory services, based on a firm understanding of stressors arising from interactions between men in gay spaces. -/- . (shrink)

Accelerating global climate change drives new climate risks. People around the world are researching, designing, and implementing strategies to manage these risks. Identifying and implementing sound climate risk management strategies poses nontrivial challenges including (a) linking the required disciplines, (b) identifying relevant values and objectives, (c) identifying and quantifying important uncertainties, (d) resolving interactions between decision levers and the system dynamics, (e) quantifying the trade-offs between diverse values under deep and dynamic uncertainties, (f) communicating to inform decisions, (...) and (g) learning from the decision-making needs to inform research design. Here we review these challenges and avenues to overcome them. ▪ People and institutions are confronted with emerging and dynamic climate risks. ▪ Stakeholder values are central to defining the decision problem. ▪ Mission-oriented basic research helps to improve the design of climate risk management strategies. (shrink)

Contemporary debates about scientific institutions and practice feature many proposed reforms. Most of these require increased efforts from scientists. But how do scientists’ incentives for effort interact? How can scientific institutions encourage scientists to invest effort in research? We explore these questions using a game-theoretic model of publication markets. We employ a base game between authors and reviewers, before assessing some of its tendencies by means of analysis and simulations. We compare how the effort expenditures of these groups interact (...) in our model under a variety of settings, such as double-blind and open review systems. We make a number of findings, including that open review can increase the effort of authors in a range of circumstances and that these effects can manifest in a policy-relevant period of time. However, we find that open review’s impact on authors’ efforts is sensitive to the strength of several other influences. (shrink)

There is a commonly made distinction between two types of scientists: risk-taking, trailblazing mavericks and detail-oriented followers. A number of recent papers have discussed the question what a desirable mixture of mavericks and followers looks like. Answering this question is most useful if a scientific community can be steered toward such a desirable mixture. One attractive route is through credit incentives: manipulating rewards so that reward-seeking scientists are likely to form the desired mixture of their own accord. (...) Here I argue that this idea is less straightforward than it may seem. Interpreting mavericks as scientists who prioritize rewards over speed and risk, I show in a deliberatively simple model that there is a fixed mixture which is not particularly likely to be desirable and which credit incentives cannot alter. I consider a way around this result, but this has some major drawbacks. I conclude that credit incentives are not as promising a way to create a desirable mixture of mavericks and followers as one might have thought. (shrink)

The relationship between philosophy and science in contemporary times is closer than ever. From the methodology perspective, scientific and philosophical research has a clear sequential relationship. It is highlighted in the following aspects: 1. the methodology of scientific research, including theoretical assumptions and data modeling, parallels with apparent similarities in conceptual analysis and logical deduction in philosophy;2. consistency of analytical argumentation methods in scientific research and philosophical research;3. naturalism is currently a research approach that both scientific and philosophical research (...) adopt. There has been a significant dispute over the relationship between philosophy and science among contemporary philosophers. This dispute focuses on the impact of scientific development on philosophy research. Nowadays, no one would deny the existence of this impact, but there is no consensus on the impact's nature, scope, and role. Wittgenstein's conception of certainty can provide valuable insights to understand the relationship between philosophy and science. In addition, we conclude the pragmatic turn in cognitive science because we misinterpret the cognitive scientists' emphasis on action as a practical claim and interpret the cognitive scientists' views with pragmatism. The theoretical analysis and research suggestions philosophers provide are becoming essential focuses in contemporary artificial intelligence research, including the interpretability of computer technology, the ethical norms of artificial intelligence technology, and the possible conception of human beings in the future. The interdisciplinary study of science and philosophy will achieve more significant development. In sum, understanding the nature of philosophy can be given a new explanation from a future perspective. The future outlook here refers to the starting point from possible world scenarios that can be conceived and traced back to all the facts happening in the present world, thereby giving an appropriate explanation to the real world. (shrink)

The relationship between philosophy and science in contemporary times is closer than ever. From the methodology perspective, scientific and philosophical research has a clear sequential relationship. It is highlighted in the following aspects: 1. the methodology of scientific research, including theoretical assumptions and data modeling, parallels with apparent similarities in conceptual analysis and logical deduction in philosophy;2. consistency of analytical argumentation methods in scientific research and philosophical research;3. naturalism is currently a research approach that both scientific and philosophical research (...) adopt. There has been a significant dispute over the relationship between philosophy and science among contemporary philosophers. This dispute focuses on the impact of scientific development on philosophy research. Nowadays, no one would deny the existence of this impact, but there is no consensus on the impact's nature, scope, and role. Wittgenstein's conception of certainty can provide valuable insights to understand the relationship between philosophy and science. In addition, we conclude the pragmatic turn in cognitive science because we misinterpret the cognitive scientists' emphasis on action as a practical claim and interpret the cognitive scientists' views with pragmatism. The theoretical analysis and research suggestions philosophers provide are becoming essential focuses in contemporary artificial intelligence research, including the interpretability of computer technology, the ethical norms of artificial intelligence technology, and the possible conception of human beings in the future. The interdisciplinary study of science and philosophy will achieve more significant development. In sum, understanding the nature of philosophy can be given a new explanation from a future perspective. The future outlook here refers to the starting point from possible world scenarios that can be conceived and traced back to all the facts happening in the present world, thereby giving an appropriate explanation to the real world. (shrink)

Extant literature suggests a positive correlation between social trust (also called generalized trust) and life satisfaction. However, the psychological pathways underlying this relationship can be complex. Using the Bayesian Mindsponge Framework (BMF), we examined the influence of social trust in a high-violence environment. Employing Bayesian analysis on a sample of 1237 adults in Cali, Colombia, we found that in a linear relationship, generalized trust is positively associated with life satisfaction. However, in a model including the interactions between trust (...) and education level as well as between trust and socioeconomic status, generalized trust is found to be negatively associated with life satisfaction. In this non-linear relationship, both education level and socioeconomic status have moderating effects against the negative association between generalized trust and life satisfaction. In other words, less educated people living in worse socioeconomic conditions are more likely to have lower life satisfaction when they have higher levels of social trust. In contrast, highly educated people living in better socioeconomic conditions are more likely to have higher life satisfaction when they have higher levels of social trust. Due to the facilitating function of trust in information processing, lowering the rigor of the filtering system in a high-violence social environment will likely put an individual at risk. Based on our findings, we suggest that policymakers should consider the impacts of social contexts when advocating for increasing social trust. We also recommend that researchers carefully examine the psychological mechanism underlying an observed association before making suggestions for policymaking. (shrink)

Pandemics have been suggested as global risks many times, but it has been shown that the probability of human extinction due to one pandemic is small, as it will not be able to affect and kill all people, but likely only half, even in the worst cases. Assuming that the probability of the worst pandemic to kill a person is 0.5, and assuming linear interaction between different pandemics, 30 strong pandemics running simultaneously will kill everyone. Such situations cannot (...) happen naturally, but because biotechnology is developing analogously to Moore’s law, it may become possible in the near future (10-50 years from now), because of biohackers, CRISPR, bioprinters, AI-assisted DNA-programing, and weapons of “knowledge-enabled mass destruction” published on the Internet. It could also happened in case of large-scale biological war, or if a rogue country released its entire biological arsenal simultaneously. We also will address other scenarios and risk increasing factors as well as mitigation and adaptation strategies. (shrink)

Phenomenology is an established school of philosophy, European in origins but now worldwide, which emphasizes experience as a basis for understanding the human condition. That proposition may seem self-evident, although there are competing bases for understanding human existence and how we ought to act. One of the interesting developments in recent philosophical debate has been the interaction between phenomenological and religious thought. Indeed, it is sometimes said that phenomenology is becoming more theological, and theological discourse more phenomenological. This (...) essay attempts to tease out six specific implications of this interaction between phenomenology and religion. (shrink)

The market capitalization of an enterprise is one of the key indicators characterizing the degree of influence of financial and non-financial instruments on its volumes and dynamics. Establishing the relationship between such instruments and metrics of equity and cash flows best delineates the plane of their direct impact on stimulating market capitalization. This is aimed at ensuring the implementation of effective management measures in the context of optimizing the use of equity and cash flows. The aim of (...) the study was to establish how the influence of indicators of financial and non-financial instruments on equity and cash flows forms a relevant basis for making management decisions to increase enterprise market capitalization. During the research, the following methods were used: summarization and grouping, multiple linear regression, direct ranking method, establishment of cause-and-effect relationships, logical generalization, and analytical method. As a result of the study, the toolkit for increasing the market capitalization of the enterprise from the standpoint of its grouping in terms of financial and non-financial plane was clarified. It was found that among the 36 analyzed indicators of the impact on equity and cash flows of the studied machine-building enterprises in Ukraine during the period 2010-2021, the most significant are bank lending, investment and technical metals, research and development costs, foreign scientific and technical services received, production investments, work-in-progress, and accounts payable for products, goods, and services. The results were transformed into a model of ranked instruments for stimulating the market capitalization of machine-building enterprises, which demonstrates the degree and directions of the influence of indicators of financial and non-financial instruments on the dynamics of equity and cash flows, which ensures the formation of an information database for making decisions on the further use of such instruments. The structuring of the toolkit serves as the basis for forming a system of management decisions containing practical recommendations within each group of instruments aimed at optimizing market capitalization through increased equity and cash flows of the enterprise. The obtained results will be beneficial to financial analysts of enterprises in preparing databases for making financial and non-financial decisions. (shrink)

At the centenary of Frank H. Knight’s Risk, Uncertainty, and Profit, we explore the continuing relevance of Knightian uncertainty to the theory and practice of entrepreneurship. There are three challenges facing such assessment. First, RUP is complex and difficult to interpret. The key but neglected element of RUP is that Knight’s account is not solely about risk and uncertainty as states of nature, but about how an agent’s beliefs about uncertain outcomes and confidence in those beliefs guide their (...) choices. Second, RUP is Knight’s only effort in this area. His subsequent career led elsewhere, so he did not engage with subsequent interpretations of this work. Third, much of the current literature emphasizes that decisions must be different under the two states of nature with a consequent misunderstanding of entrepreneurial agency. This paper addresses each challenge in sequence. First, we explicate Knight’s approach and explain why that approach is murky. Second, as a complement to Knight’s interpretation, we examine Frank P. Ramsey’s approach to subjective probabilities to help clarify Knight’s murky approach. What links Knight and Ramsey is a shared pragmatism about entrepreneurial agency under uncertainty that depends upon the beliefs about, and confidence in, their judgments of possible outcomes. This Knight-Ramsey approach does not require actor’s behaviors to be determined by the class of uncertain environment they face. We focus on the response by the entrepreneur to the existence of uncertainty in all its forms. We argue that this reductive account provides a foundation to examine common problems in management, including managerial hubris, the interaction between entrepreneurs and venture capitalists, and the need for experimentation in advance of new product and venture launches. Third, we critique current literature that favors epistemic purism about the ontology of risk and uncertainty and ignores Knight-Ramsey pragmatism in meeting uncertainty, such as using formal and informal institutions for uncertainty mitigation. Our account locates Frank Knight’s subtleties in entrepreneurial behavior firmly in the literature on entrepreneurial agency a century later. (shrink)

Everyday media consumption leaves no doubt that the perception of moving images from various media is characterized by experience and understanding. Corresponding research in this field has shown that the stimulus patterns flooding in on us are not only processed mentally, but also bodily. Building on this, the following study argues that incoming stimuli are processed not only visually, but multimodally, with all senses, and moreover affectively. The classical binding of a sensory organ to a medium, on whose delimitation the (...) common understanding of multimodality is based, is thus abolished. Can arguments for this assumption be found? Building on the research of cultural anthropologist Ernst Cassirer and his successors, the two American philosophers Susanne K. Langer and John M. Krois, and supported by research from the life sciences in which, in parallel, the arts also play an important role in understanding image formation, as in the work of Heinz Werner and, following on from this, in the more recent research of the child psychologist Daniel N. Stern in collaboration with mirror neuron research by the group of neuroscientists around Giacomo Rizzolatti in Parma, justifications for this will be provided. What the multimodal processing of film images is concretely based on will finally be made clear by means of an exemplary analysis of a video film by the Swiss artist Pipilotti Rist. It aims to prove, that the prerequisites for the thesis can only lie in the fact, that both the modes of perception (visual, tactile, auditory, olfactory, gustatory) as well as the medially conditioned modes of image formation are based on non-discursive, formal-abstract structures that are also processed affectively. At the same time, the analysis thus shows how the selection and composition of the vital experienced forms can provide information about the socio-culturally shaped self-image of the producer and the viewer. (shrink)

The market failures approach to business ethics has recently garnered substantial critical attention (see, e.g., Cohen and Peterson 2019; Moriarty 2020; Steinberg 2017; Hsieh 2017; von Kriegstein 2016; Smith 2018; Endorfer and Larue 2022; Singer 2018). Though precursors of this view can be found in the literature (e.g., McMahon 1981; Friedman 1970), it was Joseph Heath (2004, 2006, 2014, 2023) who developed the approach and gave it its name. The market failures approach (henceforth: MFA) is concerned with the (...) ethical obligations of managers of firms (Heath 2014, 69). Roughly, it holds that managers ought not to conduct their businesses in a way that exploits market failures. “Market failure” is a technical term, meaning any failure of the conditions of the first fundamental welfare theorem, sometimes called the “Pareto conditions” (see Arrow 1951). The theorem states that if the Pareto conditions hold, then the market equilibrium will use society’s scarce resources efficiently, meaning that no one could be made better-off without making anyone else worse off. Efficiency, according to Heath (2014, chapter 7), is the implicit morality of the market. We coordinate much of our shared activity using markets, Heath claims, because of their ability to produce efficient results. Markets are good forms of social organization, according to Heath, because they are the best way to promote our values given empirical facts about the frailties of human psychology and the informational constraints that we face. As such, managers ought not compromise the very conditions that justify a market economy by profiting from breakdowns in the market’s efficiency. Managers are permitted to maximize profits, so long as they do not violate the market’s norm of efficiency in so doing. This is because the fundamental justification for the profit motive is that it is necessary for the operation of the price system which is essential to the efficiency properties of markets. In this paper, I will argue that the MFA is more general than even Heath himself claims. The MFA describes the professional obligations of managers, but the view I develop, the generalized market failures approach, describes the obligations of all market participants. Since efficiency is the implicit morality of the market, it binds not just managers, but all market participants, including consumers, investors and workers. Market participants are permitted to maximize the benefit they gain from market interactions, as long as they do so in a way that does not take advantage of any market failures. Generalizing the MFA in this way has three benefits: first, we gain a unified understanding of the ethics of non-managerial market roles; second, we will develop an even better understanding of the duties of managers; finally, it gives us the resources to respond to some familiar objections to the MFA found in the literature. In the next section, I will further motivate the MFA and explain how this motivation can be easily generalized to other market roles. Importantly, one can avoid benefiting from a market failure in two distinct ways: by avoiding transactions that exploit market failures or by transacting in such markets and then remediating the harm done, by compensating those negatively affected by the market failure. This section concludes by discussing how the remediation duties are to be split between the transacting parties and how to identify the parties to whom compensation is owed. In section 3, I use the tools of the generalized MFA to develop a unified ethics of consumption, investment and labor, respectively. This is the basis of a grand abductive argument for the generalized MFA. The view is strongly supported by the fact that it provides attractive and unifying explanations of our obligations in domains as variegated as carbon offsetting, CEO compensation, the reparations white Americans owe to black Americans and occupational licensure. Section 4 briefly concludes. (shrink)

The Market Failures Approach (MFA) is one of the leading theories in contemporary business ethics. It generates a list of ethical obligations for the managers of private firms that states that they should not create or exploit market failures because doing so reduces the efficiency of the economy. Recently the MFA has been criticised by Abraham Singer on the basis that it unjustifiably does not assign private managers obligations based on egalitarian values. Singer proposes an extension to the (...) MFA, the Justice Failures Approach (JFA), in which managers have duties to alleviate political, social, and distributive inequalities in addition to having obligations to not exploit market failures. In this paper I describe the MFA and JFA and situate them relative to each other. I then highlight a threefold distinction between different types of obligations that can be given to private managers in order to argue that a hybrid theory of business ethics, which I call the MFA +, can be generated by arguing that managers have obligations based on efficiency and duties based on equality to the extent that these latter obligations do not lead to efficiency losses. This argument suggests a novel theoretical option in business ethics, elucidates the issues that are at stake between the MFA and the JFA, and clarifies the costs and benefits of each theory. (shrink)

This paper presents an analytical model for valuing interest rate swaps, subject to bilateral counterparty credit risk. The counterparty defaults are modeled by the reduced-form model as the first jump of a time-inhomogeneous Poisson process. All quantities modeled are market-observable. The closed-form solution gives us a better understanding of the impact of the credit asymmetry on swap value, credit value adjustment, swap rate and swap spread.

Can trust evolve on the Internet between virtual strangers? Recently, Pettit answered this question in the negative. Focusing on trust in the sense of ‘dynamic, interactive, and trusting’ reliance on other people, he distinguishes between two forms of trust: primary trust rests on the belief that the other is trustworthy, while the more subtle secondary kind of trust is premised on the belief that the other cherishes one’s esteem, and will, therefore, reply to an act of trust in (...) kind (‘trust-responsiveness’). Based on this theory Pettit argues that trust between virtual strangers is impossible: they lack all evidence about one another, which prevents the imputation of trustworthiness and renders the reliance on trust-responsiveness ridiculous. I argue that this argument is flawed, both empirically and theoretically. In several virtual communities amazing acts of trust between pure virtuals have been observed. I propose that these can be explained as follows. On the one hand, social cues, reputation, reliance on third parties, and participation in (quasi-) institutions allow imputing trustworthiness to varying degrees. On the other, precisely trust-responsiveness is also relied upon, as a necessary supplement to primary trust. In virtual markets, esteem as a fair trader is coveted while it contributes to building up one’s reputation. In task groups, a hyperactive style of action may be adopted which amounts to assuming (not: inferring) trust. Trustors expect that their virtual co-workers will reply in kind while such an approach is to be considered the most appropriate in cyberspace. In non-task groups, finally, members often display intimacies while they are confident someone else ‘out there’ will return them. This is facilitated by the one-to-many, asynchronous mode of communication within mailing lists. (shrink)

This paper addresses the cultural impact of genomics and the Human Genome Project on human self-understanding. Notably, it addresses the claim made by Francis Collins that the genome is the language of God and the claim made by Max Delbrück that Aristotle must be credited with having predicted DNA as the soul that organises bio-matter. From a continental philosophical perspective I will argue that human existence results from a dialectical interaction between two types of texts: the language of (...) molecular biology and the language of civilisation; the language of the genome and the language of our socio-cultural, symbolic ambiance. Whereas the former ultimately builds on the alphabets of genes and nucleotides, the latter is informed by primordial texts such as the Bible and the Quran. In applied bioethics deliberations on genomics, science is easily framed as liberating and progressive, religious world-views as conservative an... (shrink)

The relationship between Vietnam and China could be captured in the Chinese expression of “同床异梦”, which means lying on the same bed but having different dreams. The two countries share certain cultural and political similarities but also diverge vastly in their national interests. This paper adds to the extant literature on this topic by analyzing the element of trust/mistrust in their interactions in trade-investment, tourism, and defense-security. The analysis shows how the relationship is increasingly interdependent but is equally fragile (...) due to the lack of trust on both sides. The mistrust or even distrust of Chinese subjects run deep within the Vietnamese mindset, from the skepticism of Chinese investment, Chinese tourists, discrimination against ethnic Chinese, to the caution against Chinese aggression in the South China Sea. The paper forecasts that, despite the deep-seated differences and occasional mistrust, going forward, neither side would risk damaging the status quo even when tensions peak. (shrink)

This chapter looks closely at the use of resilience as a value in pandemic discourses, and particularly at how it reflects the moral complexity of the situation the pandemic presents: an extended crisis where shocks and stressors interact and have an uncertain end. We review key aspects of how resilience has been conceptualised, generally speaking, focusing on its normative implications. Insofar as resilience is suggested as a goal, or used to evaluate individuals, groups and systems, the rhetorical use of resilience (...) in the pandemic has moral implications that we unpack. Asking questions such as resilience to what, of what, and for whom, drives our analysis of the multiple scales at which morally relevant factors must be considered, in terms of distance and certainty, and across space and over time. Further, we highlight the importance of particularly challenging, intersecting scales both within and beyond the pandemic, such as the interaction between other- and self-regarding concerns and the tension between transformation and conservation, as we consider when to take up opportunities for improving ourselves, our society and our systems, in times of extended crises and radical change. Given that a ‘return to normal’ is neither universally desirable nor likely, we recommend in this chapter ways to address resilience as a value that can shape approaches to policy and behaviour while also being explicit about the normative—evaluative and also prescriptive—implications of its use. (shrink)

In this paper, we discuss some problems and prospects of interdisciplinary encounters by focusing on philosophy of science as a case study. After introducing the case, we give an overview about the various ways in which philosophy of science can be interdisciplinary in Section 2. In Section 3, we name some general problems concerning the possible points of interaction between philosophy of science and the sciences studied. In Section 4 we compare the advantages and risks of interdisciplinarity for (...) individual researchers and institutions. In Section 5, we discuss interdisciplinary PhD programs, in particular concerning two main problems: increased workload and the quality of supervision. In the final Section 6, we look at interdisciplinary careers beyond the PhD. (shrink)

Interactions between an intelligent software agent and a human user are ubiquitous in everyday situations such as access to information, entertainment, and purchases. In such interactions, the ISA mediates the user’s access to the content, or controls some other aspect of the user experience, and is not designed to be neutral about outcomes of user choices. Like human users, ISAs are driven by goals, make autonomous decisions, and can learn from experience. Using ideas from bounded rationality, we frame these (...) interactions as instances of an ISA whose reward depends on actions performed by the user. Such agents benefit by steering the user’s behaviour towards outcomes that maximise the ISA’s utility, which may or may not be aligned with that of the user. Video games, news recommendation aggregation engines, and fitness trackers can all be instances of this general case. Our analysis facilitates distinguishing various subcases of interaction, as well as second-order effects that might include the possibility for adaptive interfaces to induce behavioural addiction, and/or change in user belief. We present these types of interaction within a conceptual framework, and review current examples of persuasive technologies and the issues that arise from their use. We argue that the nature of the feedback commonly used by learning agents to update their models and subsequent decisions could steer the behaviour of human users away from what benefits them, and in a direction that can undermine autonomy and cause further disparity between actions and goals as exemplified by addictive and compulsive behaviour. We discuss some of the ethical, social and legal implications of this technology and argue that it can sometimes exploit and reinforce weaknesses in human beings. (shrink)

Scholarly discourse on “disruptive technologies” has been strongly influenced by disruptive innovation theory. This theory is tailored for analyzing disruptions in markets and business. It is of limited use, however, in analyzing the broader social, moral and existential dynamics of technosocial disruption. Yet these broader dynamics should be of great scholarly concern, both in coming to terms with technological disruptions of the past and those of our current age. Technologies can disrupt social relations, institutions, epistemic paradigms, foundational concepts, values, and (...) even the nature of human cognition and experience – domains of disruption that are largely neglected in existing discourse on disruptive technologies. Accordingly, this paper seeks to reorient scholarly discussion around a broader notion of technosocial disruption. This broader notion raises three foundational questions. First, how can technosocial disruption be conceptualized in a way that clearly sets it apart from the disruptive innovation framework? Secondly, how does the notion of technosocial disruption relate to the concordant notions of “disruptor” and “disruptiveness”? Thirdly, can we advance criteria to assess the “degree of social disruptiveness” of different technologies? The paper clarifies these questions and proposes an answer to each of them. In doing so, it advances “technosocial disruption” as a key analysandum for future scholarship on the interactions between technology and society. (shrink)

In this note, we consider a Merton model for default risk, where the firm’s value is driven by a Brownian motion and a compound Poisson process.

The chapter reconstructs the eighteenth-century discussion on commerce and virtue in the light of Hirschman's, Pocock's, Polanyi's, and Viner's interpretations of that discussion. The claims put forth are: the history of the emerging of modern market society has been heavily conditioned by a teleological and deterministic interpretation of history; the eighteenth-century discussion cannot be read neither in terms of ideologies nor in terms of the history of economic analysis; a 'strategic' reading is fruitful in so far as it allows (...) two-ways interactions between discourse and social facts. (shrink)

A modified visual search task demonstrates that humans are very good at resuming a search after it has been momentarily interrupted. This is shown by exceptionally rapid response time to a display that reappears after a brief interruption, even when an entirely different visual display is seen during the interruption and two different visual searches are performed simultaneously. This rapid resumption depends on the stability of the visual scene and is not due to display or response anticipations. These results are (...) consistent with the existence of an iterative hypothesis-testing mechanism that compares information stored in short-term memory (the perceptual hypothesis) with information about the display (the sensory pattern). In this view, rapid resumption occurs because a hypothesis based on a previous glance of the scene can be tested very rapidly in a subsequent glance, given that the initial hypothesis-generation step has already been performed. (shrink)

Recently, a strong hylomorphic reading of Aristotelian emotions has been put forward, one that allegedly eliminates the problem of causal interaction between soul and body. Taking the presentation of emotions in de An. I 1 as a starting point and basic thread, but relying also on the discussion of Rh. II, I will argue that this reading only takes into account two of the four causes of emotions, and that, if all four of them are included into the (...) picture, then a causal interaction of mind and body remains within Aristotelian emotions, independent of how strongly their hylomorphism is understood. Beyond the discussion with this recent reading, the analysis proposed of the fourfold causal structure of emotions is also intended as a hermeneutical starting point for a comprehensive analysis of particular emotions in Aristotle. Through the different causes Aristotle seems to account for many aspects of the complex phenomenon of emotion, including its physiological causes, its mental causes, and its intentional object. (shrink)

The article focuses on the philosophical and scientific dialogue between Vladimir Vernadsky and Pavel Florensky in the context of Russian philosophy. Florensky formulated his philosophy in the book The Pillar and Ground of the Truth, making a great impact on Vernadsky. The two philosophers exchanged their thoughts through letters. During the time of his imprisonment, Florensky wrote letters on scientific topics to his son Kirill, who worked with Vernadsky. Thus, Kirill Florensky became the point of contact between the (...) two thinkers. The present article aims to show the complementarity between Vernadsky’s and Florensky’s work with a particular emphasis on their conception of noosphere-pneumatosphere connected with Plato’s methaphysics, which Florensky interpreted as the world of the Truth or absolute reality. Through investigating Vernadsky’s and Florensky’s letters and diaries and comparing their conceptions of noosphere and pneumatosphere, as well as their interpretation of reality in their writings, it is possible to determine influences of the concepts important for Russian religious philosophers, such as a tendency towards wholeness and intuition. The first part of the article examines Vernadsky in relation to Russian idealists, the second part of the article is focused on the relationship between Vernadsky and Florensky, and the third on the concepts of noosphere, pneumatosphere, and the concept of reality (living being) — absolute reality (Truth). Through these three steps, the complementarity of Vernadsky’s and Florensky’s interpretations are illustrated. Their interpretations are not contradictory because while Vernadsky dealt with Earth’s reality and its evolution, and Florensky focused on the metaphysical world, both were interested in the evolution of the biosphere-noosphere/pneumatosphere through the activity of man. The article is the first study in English focused on the scientific and religious-philosophical interaction between Vernadsky and Florensky. (shrink)

While Hume had a favorable opinion of the new commercial society, Reid envisioned a utopian system that would eliminate private property and substitute the profit incentive with a system of state-conferred honors. Reid’s predilection for a centralized command economy cannot be explained by his alleged discovery of market failures, and has to be considered in the context of his moral psychology. Hume tried to explain how the desire for gain that motivates the merchant leads to industry and frugality. These, (...) in their turn, benefit all society. Reid still saw the desire for money as a degenerate form of the desire for power. The contrast between Hume and Reid, however, has not to be taken too far. On some particular matters of economic policy, such as paper credit, Hume and Reid eventually came to similar views. (shrink)

The paper outlines critical aspects concerning the increasing use of big data in agriculture and farming. In particular, the aim is to shed light on the emerging dominance of the platform economy in the field of agriculture and food production. To analyze those power structures shaping this dynamic, we start with brief observations on the general relationship between digitization and agriculture and explain the platform economy, its general business model, and the proprietary forms of market power emerging from (...) it. Subsequently, we analyze the implications of the involvement of platform-economic companies in the agricultural sector. To do so, we critically examine several key examples that illuminate the strategies and ultimate objectives of those key tech players involved in this transition––particularly, two of the most dominant cloud providers, Alphabet and Amazon. Finally, we identify the main problems that can potentially emerge, and that can already be observed, from Big Tech’s involvement in agriculture and food production: (1) epistemic asymmetry (2) the erosion of privacy (3) potential harms to smaller farms and farmers, and (4) systemic dependencies on a monopolist data infrastructure. As we argue, these four dimensions are not only essential to take into account, but they also ultimately need to be responded to politically. From a policy perspective, to maintain data justice and epistemic symmetry, and to avoid the risks highlighted, we suggest––next to stressing the need for critical scholarship––to establish a democratically governed data trust, rely on open source technology, and fundamentally commit to the principle of collective data sovereignty. -/- Keywords: big tech, data sovereignty, digital farming, digital agriculture, surveillance capitalism, platform economy. (shrink)

Abstract: One approach to alignment with human values in AI and robotics is to engineer artiTicial systems isomorphic with human beings. The idea is that robots so designed may autonomously align with human values through similar developmental processes, to realize project ideal conditions through iterative interaction with social and object environments just as humans do, such as are expressed in narratives and life stories. One persistent problem with human value orientation is that different human beings champion different values as (...) ideal, meaning that the values to which an AI should be aligned are ambiguous. Prior work considered human development of purpose and source of meaning in life in terms of project ideal conditions, in effect establishing lifelong value orientations according to which intermediate situations are evaluated. The present work compares views on motivating values from St. Augustine and from popular cognitive science. These accounts are described as divergent error theories which present to their proponents as mutually exclusive yet accurate accounts of personal experience due to differential development of variable innate potentials. SpeciTically, the hypothesis proposed is that differential development of spindle neural projections establishes enduring connections between prior established relatively immediate routine processes entrained during childhood and prioritized in popular cognitive science, and later developing higher-level social and self-processes entrained during adolescence and emphasized in Augustine's account, with these projections hard-wiring lifelong motivating value orientations more or less inaccessible to modiTication through material interaction. Robot experiments informed by this study may evaluate variable value orientation by design, with for example autonomous robots developing motivating associations with temporally distal project ideal conditions through love for humanity, as described by Augustine, and others pursuing adaptive Tit to passing norms consistent with popular contemporary accounts. (shrink)