The Contagion Effect of Compensation Regulation: Evidence From China

To shed light on whether and how firms changed compensation practices in response to a shift in the environment in which they operated, we examine whether there is contagion effect of executive compensation regulation on state-owned enterprises (SOEs) in the emerging market of China. Specifically, we investigate whether firms not directly affected by the changing regulatory environment nonetheless changed executive compensation in response to the actions of the directly affected firms, which is called contagion effect. We further examine the specific contagion mechanisms and the economic consequences of regulation on compensation. We find that the regulation has a significant effect on compensation gap in central SOEs and a contagion effect on local SOEs but not for non-SOEs. Within SOEs, there is an intra-industry contagion effect of compensation regulation but not an intra-region effect. Further, central SOEs and local SOEs experience reduced firm performance after the compensation regulations, but not the non-SOEs; indicating that the compensation regulation does not have favorable economic consequences for both the directly affected central SOEs and the indirectly affected local SOEs.

Quality-Adjusted Life-Year Losses Averted With Every COVID-19 Infection Prevented in the United States

OBJECTIVE

To estimate the overall quality-adjusted life-years (QALYs) gained by averting 1 coronavirus disease 2019 (COVID-19) infection over the duration of the pandemic.

METHODS

A cohort-based probabilistic simulation model, informed by the latest epidemiological estimates on COVID-19 in the United States provided by the Centers for Disease Control and Prevention and literature review. Heterogeneity of parameter values across age group was accounted for. The main outcome studied was QALYs for the infected patient, patient's family members, and the contagion effect of the infected patient over the duration of the pandemic.

RESULTS

Averting a COVID-19 infection in a representative US resident will generate an additional 0.061 (0.016-0.129) QALYs (for the patient: 0.055, 95% confidence interval [CI] 0.014-0.115; for the patient's family members: 0.006, 95% CI 0.002-0.015). Accounting for the contagion effect of this infection, and assuming that an effective vaccine will be available in 3 months, the total QALYs gains from averting 1 single infection is 1.51 (95% CI 0.28-4.37) accrued to patients and their family members affected by the index infection and its sequelae. These results were robust to most parameter values and were most influenced by effective reproduction number, probability of death outside the hospital, the time-varying hazard rates of hospitalization, and death in critical care.

CONCLUSION

Our findings suggest that the health benefits of averting 1 COVID-19 infection in the United States are substantial. Efforts to curb infections must weigh the costs against these benefits.

Emerging and advanced economies markets behaviour during the COVID‐19 crisis era

This article examines the consequences of the COVID‐19 crisis on the interdependencies between emerging and advanced economies. Using daily market index data from 22 developed and emerging markets, we develop a combination of statistical methods based on Diebold and Yilmaz spillover index and Toda–Yamamoto and Dolado and Lütkepohl causality approach. The results substantiate an increase in the interdependence between emerging and advances economies, which suggests an increase in the transmission of the stress and uncertainty between financial markets during the pandemic period. Our findings show that the emerging countries are affected by the financial markets of advanced economies during the COVID‐19 crisis and, in particular, by European markets, which appear to be the primary driver of contagion and transmission of stress and uncertainty to all other regional markets.

The influence of a competition on noncompetitors

We report a series of experimental studies that investigate the influence of a competition on noncompetitors who do not participate in it but are aware of it. Our work is highly relevant across many domains of social life where competitions are prevalent, as it is typical in a competition that the competitors are far outnumbered by these noncompetitors. In our field experiment involving pay-what-you-want entrance at a German zoo (n = 22,886), customers who were aware of a competition over entrance payments, but did not participate in it, paid more than customers who were unaware of the competition. Further experiments provide confirmatory and process evidence for this contagion effect, showing that it is driven by heightened social comparison motivation due to mere awareness of the competition. Moreover, we find evidence that the reward level for the competitors could moderate the contagion effect on the noncompetitors. Even if an individual does not participate in a competition, their behavior can still be influenced by it, and this influence can change with the characteristics of the competition in an intriguing way.