This paper explores the nature of default arrival and recovery implicit in the term structures of sovereign CDS spreads. We argue that term structures of spreads reveal not only the arrival rates of credit events (λ), but also the loss rates given credit events. Applying our framework to Mexico, Turkey, and Korea, we show that a single-factor model with λ following a lognormal process captures ...

We consider the problem of a mutual fund manager that maximizes the present value of expected fees and has to decide the level of fee to impose on the fund. The fee will be paid by a risk averse investor that maximizes expected utility over final wealth. This investor can invest either in an indexed fund or in a managed fund. The manager has superior ability and, as a result of it, the fund off...

Based on institutional theory, I extend research on the regulative role of national government in society, and suggest that government exerts important influences on firms‘ actions through the diffusion of norms. I suggest that by instituting the Council on Ethics which publicly ―censors‖ and ―certifies‖ the Norwegian sovereign wealth fund‘s cross-border investments, the Norwegian government co...