Leadership, identity, and revenge

Purpose – The purpose of this paper is to examine the effects of the 2007-2009 uncertainty shocks on policymakers’ behavior. Design/methodology/approach – Uncertainty shocks in the US credit, financial and production markets are represented by extraordinary events. As in Bloom (2009), these events are associated with significant economic and political shocks (e.g. Lehman Brothers’ collapse). Credit markets uncertainty shocks, which played a crucial role in the aftermath of the house prices collapse in the USA, are first analyzed in a bivariate VAR context, and then, embodied in a simple theoretical framework. Findings – The empirical evidence suggests that the US credit, financial and production markets have been affected by a relative large number of uncertainty shocks (i.e. rare events). In a Brainard’s (1967) uncertainty scenario, it is shown that a bizarre money-liquidity relationship exacerbates the “policymakers’ cautiousness-aggressiveness trade-off.” In addition, the model suggests that a “double” dose of policy, in presence of a global credit crunch, might be useless. Originality/value – This paper improves the existing literature in two main directions. First, it provides novel empirical evidence on the unusual dynamics of the US credit market and its effects on the real economic activity during the crisis. Second, in a very simple theoretical framework accounting for parameter uncertainty, it addresses whether a bizarre money-credit relationship affects policymakers’ behavior (i.e. cautiousness vs aggressiveness).

Explaining Financial Scandals: Corporate Governance, Structured Finance and the Enlightened Sovereign Control Paradigm (Introduction)

Human Resource Management Practices and Ethical Climate in the Pakistani Banking Industry: The Role of Corporate Sustainability and Organizational Trust

Understanding the phenomenon of religious violence requires a theoretical approach to the task. Ideally, the theoretical framework must integrate (1) the insights of neurobiology and ethnology elucidating the roots of aggression in the organism and its manifestations in animal behaviour, (2) the expression of these in human violence, which requires careful attention to linguistic and other expressions in culture, (3) the special role of religious representations in this connection, and (4) the mechanisms, in time and place, whereby the role of religion in the maintenance of cultural order is reversed, and becomes an ally of violence. Psychological theories, like the psychoanalytic school, have a contribution to make to this end. But they also exhibit limitations. The most compelling anthropological theory to date is René Girard's, which focuses on mimetic desire, violence, its resolution through scapegoating and subsequent enactment in ritual. The sacred is seen to lie at the origins of cultural order. But it also harbours a potential for a resurgence of the violence it conceals. Other researchers have shown how certain features of modernity unwittingly fuel violence through the promulgation of stereotypical, group identities. Contemporary Islamist violence (Jihadism) offers a case-study for these theoretical axioms. The example is not peculiar or sui generis. Rather it illustrates, more widely, the nature of the sacred and its relation to history. The Islamic tradition and modern Muslim history also provide a template for an analytic understanding of religious symbols, and their degradation into symbols of a typically modern demand for recognition of ego and group orientated identities. This psychosocial configuration necessarily escapes the attention of the actors, and because of the nominal persistence of old symbols, may also escape the attention of observers. To expose and explain these discrepancies is one of the central tasks of analysis in the proposed theoretical framework.

We show how the interbank payment system can become illiquid following wide‐scale disruptions. Two forces are at play in such disruptions—operational problems and changes in participants’ behavior. If the disruption is large enough, hits a key geographic area, or hits a “too‐big‐to‐fail” participant, then the smooth processing of payments can break down, and central bank intervention might be required to reestablish the socially efficient equilibrium. The paper provides a theoretical framework to analyze the effects of events such as the September 11 attack. In addition, the model can be reinterpreted to analyze shocks to fundamentals that affect the parameters of the intraday liquidity management game. We demonstrate this by showing how processing behavior changed in response to heightened credit risk at the time of the Lehman Brothers failure.