Using a multi-period partial equilibrium model, I demonstrate that a combination of management fees and a time-varying information advantage for a fund manager can account for several empirically observed characteristics of closed-end funds simultaneously. The model is consistent with the basic time-series behavior of fund discounts, accounts for the excess volatility of fund returns, explains why the management fee appears to be an insignificant determinant of discounts, and is consistent with many time-series correlations between discounts, NAV returns, and fund returns. The model also generates novel predictions regarding the relations between asset turnover, discounts, and returns.

This article examines the effect of asymmetric information on the trading of underwriting risk between insurers and reinsurers and how it is mitigated in a context of long-term relationships. It begins by explaining how information problems affect the efficiency of the allocation of risk between insurers and reinsurers and how long-term implicit contracts allow the inclusion of new information in the pricing of reinsurance coverage. A key feature of these relationships is the reliance on loss-contingent rebates and commissions in the pricing of reinsurance coverage. We argue that when information is revealed only over time, long-term implicit contracts between insurers and reinsurers allow the inclusion of new information into reinsurance pricing. Because of this feature, the allocation of risk between insurers and reinsurers is more efficient. Specifically, such arrangements lead to more reinsurance coverage, higher insurer profits, and lower expected distress in the industry. Journal of Economic Literature Classification Numbers: G22, G13, L15, D81.

Edward L Glaeser of Harvard University reviews “Chicago before the Fire: An Economic History” by Louis P. Cain The Econlit abstract of this book begins: “Examines the economic and business history of Chicago before the Great Fire of 1870, focusing on how the city's early growth and development determined its rise as the Midwest's dominant city.”

Half of individuals released from prison in the United States will be re-incarcerated within three years, creating an incarceration cycle that is detrimental to individuals, families, and communities. There is tremendous public interest in ending this cycle, and public policies can help or hinder the reintegration of those released from jail and prison. This review summarizes the existing empirical evidence on how to intervene with existing offenders to reduce criminal behavior and improve social welfare. (JEL D91, I18, I28, I38, K42, R23)