<p>To business owners and consumers electronic commerce means new conditions and possibilities. Often and specially at the Internet information between consumers and sellers is asymmetrically distributed. Among the consumers there is a shortage of confidence in electronic commerce. In order of a positive development of electronic commerce it´s important to find a solution to the shortage of confidence. Confidence may be created by legislation or by self- regulation. This master thesis investigate whether a self-regulation may establish a confidence in and promote the development of electronic commerce. Self- regulation means different kinds of marketmechanisms. Examples of self- regulation are well-known brandnames and recommendations or guidelines for marketing. Even if self-regulation may establish a confidence in electronic commerce all products won´t be sold effectively at the Internet.</p>

To business owners and consumers electronic commerce means new conditions and possibilities. Often and specially at the Internet information between consumers and sellers is asymmetrically distributed. Among the consumers there is a shortage of confidence in electronic commerce. In order of a positive development of electronic commerce it´s important to find a solution to the shortage of confidence. Confidence may be created by legislation or by self- regulation. This master thesis investigate whether a self-regulation may establish a confidence in and promote the development of electronic commerce. Self- regulation means different kinds of marketmechanisms. Examples of self- regulation are well-known brandnames and recommendations or guidelines for marketing. Even if self-regulation may establish a confidence in electronic commerce all products won´t be sold effectively at the Internet.

This study poses two questions relating to earnings management with the intent to mislead the market for the firms equity and debt. A multiple regression model is used to test two hypoteses through 7 hypothesized determinants of discretionary accruals and 3 control variables. A sample of Swedish real estate firms, including only the years when the firms are both quoted and have disclosed discretionary revaluations of their real estate properties is analyzed. Evidence is found of earnings management with the intent of misleading the stock market but no such evidence is found of earnings management with the intent of misleading the market for corporate debt. The implications of the findings are discussed and the direct and indirect harm of earnings management is specified.

Bakgrund: Börsen ger en möjlighet för företag att erhålla kapital och för placerare atttillgodogöra sig avkastning. Personer med insyn i det egna företaget, så kalladeinsiders, kan dock i egenskap av sin position inneha kurspåverkande information somövriga aktörer på marknaden inte har möjlighet att ta del av. Tidigare forskning harpåvisat att insiders utnyttjar denna informationsasymmetri för att på så sätt tillgodogörasig överavkastning. Syfte: Syftet med studien är att undersöka om insiders kan tillgodogöra sigöveravkastning genom handel med aktier på Nasdaq OMX. Vidare ämnar studienutröna eventuella skillnader i överavkastning beroende på företagsstorlek,transaktionsstorlek samt tidsperiod. Metod: I denna studie har en kvantitativ forskningsstrategi i form av en eventstudietillämpats. Studien har en deduktiv ansats och undersöker insidertransaktioner från 90företag på stockholmsbörsen under tidsperioden 2006-01-01 till 2011-12-31. Förberäkning av överavkastning har den justerade marknadsmodellen använts. Kursdata förrespektive företag har hämtats från databasen Thomson Reuters EcoWin Pro.Information om insidertransaktioner har hämtats från finansinspektionensinsynsregister. Resultat: Resultatet visar att insiders tillgodogör sig överavkastning genom handel medaktier i det egna företaget, främst i samband med säljtransaktioner. / People with insight into their own company, also known as insiders, can have access toprice-sensitive information which other investors are not able to access. Previousresearch has shown that insiders exploit this asymmetric information to thereby obtainabnormal returns. The purpose of this study is to investigate whether insiders can obtain abnormal returnsby trading shares on Nasdaq OMX. Furthermore, the study aims to investigate if thereare any differences in the abnormal return depending on company size, transaction size,and time period. This study investigates insider transactions of 90 companies on the Stockholm StockExchange during the time period 2006-01-01 to 2011-12-31. The results show that insiders obtain abnormal returns by trading shares in their owncompany. The abnormal returns occur primarily related to sales transactions.

The organic wheat supply chain in Canada operates in a relatively new sector for which there is very little public information to aid in price discovery. Organic wheat producers must use available information in order to decide when to sell their wheat and whom to sell to. The relatively low degree of market information, especially for producers, suggests a problem of information asymmetry, which may have ramifications for efficiency and the distribution of rents in the organic wheat supply chain. The literature on Transaction Cost Economics, Agency Theory and the Economics of Information is used in the thesis to theorize differences between methods of selling organic wheat that vary in terms of vertical coordination. The analysis involves a comparison of selling to large and small grain companies, selling through Producer-Owned Firms (POFs) and selling directly to processors. The theory predicts that producers gain from using a POF because of savings in transaction costs and higher prices. These theorized differences in transaction costs and price are due to increased sharing of information between the producer and the marketing agent, enhanced producer control over the marketer, and incentive for the marketer to provide producers with a high price. These benefits can also be realized by selling directly to a processor, but only if the producer can effectively and efficiently perform his or her own marketing functions. Average cost, price and profit margins are used as a metric for comparing each of the four governance structures. A survey of organic wheat producers in Saskatchewan was undertaken in order to collect data on organic Hard Red Spring Wheat (HRSW) transactions. The results indicate that governance structure has a statistically significant effect on organic HRSW prices and on producer transaction costs. The analysis concludes that the producer receives the greatest profit margin from selling through the vertically coordinated POF, while a marketer receives the greatest profit margin if it operates as a large grain company and purchases HRSW on the spot market. The results also suggest that organic producers that eliminate the middleman and sell directly to processors cannot market as efficiently and effectively compared with producers that use a POF. The results of this thesis emphasize that increased coordination between producer and marketer through a POF can be advantageous for the producer, but not necessarily for the marketer, due to the difference in the distribution of rents.

This dissertation includes two essays on adverse selection and moral hazard problems in reinsurance markets. The first essay builds a competitive principal-agent model that considers adverse selection and moral hazard jointly, and characterizes graphically various forms of separating Nash equilibria. In the second essay, we use panel data on U.S. property liability reinsurance for the period 1995-2000 to test for the existence of adverse selection and moral hazard. We find that (1) adverse selection is present in private passenger auto liability reinsurance market and homeowners reinsurance market, but not in product liability reinsurance market; (2) residual moral hazard does not exist in all the three largest lines of reinsurance, but is present in overall reinsurance markets; and (3) moral hazard is present in the product liability reinsurance market, but not in the other two lines of reinsurance.

My doctoral thesis “Essays on Lifetime Uncertainty: Models, Applications, and Economic Implications” addresses economic and mathematical aspects pertaining to uncertainties in human lifetimes. More precisely, I commence my research related to life insurance markets in a methodological direction by considering the question of how to forecast aggregate human mortality when risks in the resulting projections is important. I then rely on the developed method to study relevant applied actuarial problems. In a second strand of research, I consider the uncertainty in individual lifetimes and its influence on secondary life insurance market transactions. Longevity risk is becoming increasingly crucial to recognize, model, and monitor for life insurers, pension plans, annuity providers, as well as governments and individuals. One key aspect to managing this risk is correctly forecasting future mortality improvements, and this topic has attracted much attention from academics as well as from practitioners. However, in the existing literature, little attention has been paid to accurately modeling the uncertainties associated with the obtained forecasts, albeit having appropriate estimates for the risk in mortality projections, i.e. identifying the transiency of different random sources affecting the projections, is important for many applications. My first essay “Coherent Modeling of the Risk in Mortality Projections: A Semi-Parametric Approach” deals with stochastically forecasting mortality. In contrast to previous approaches, I present the first data-driven method that focuses attention on uncertainties in mortality projections rather than uncertainties in realized mortality rates. Specifically, I analyze time series of mortality forecasts generated from arbitrary but fixed forecasting methodologies and historic mortality data sets. Building on the financial literature on term structure modeling, I adopt a semi-parametric representation that encompasses all models with transitions parameterized by a Normal distributed random vector to identify and estimate suitable specifications. I find that one to two random factors appear sufficient to capture most of the variation within all of our data sets. Moreover, I observe similar systematic shapes for their volatility components, despite stemming from different forecasting methods and/or different mortality data sets. I further propose and estimate a model variant that guarantees a non-negative process of the spot force of mortality. Hence, the resulting forward mortality factor models present parsimonious and tractable alternatives to the popular methods in situations where the appraisal of risks within medium or long-term mortality projections plays a dominant role. Relying on a simple version of the derived forward mortality factor models, I take a closer look at their applications in the actuarial context in the second essay “Applications of Forward Mortality Factor Models in Life Insurance Practice. In the first application, I derive the Economic Capital for a stylized UK life insurance company offering traditional product lines. My numerical results illustrate that (systematic) mortality risk plays an important role for a life insurer's solvency. In the second application, I discuss the valuation of different common mortality-contingent embedded options within life insurance contracts. Specifically, I present a closed-form valuation formula for Guaranteed Annuity Options within traditional endowment policies, and I demonstrate how to derive the fair option fee for a Guaranteed Minimum Income Benefit within a Variable Annuity Contract based on Monte Carlo simulations. Overall my results exhibit the advantages of forward mortality factor models in terms of their simplicity and compatibility with classical life contingencies theory. The second major part of my doctoral thesis concerns the so-called life settlement market, i.e. the secondary market for life insurance policies. Evolving from so-called “viatical settlements” popular in the late 1980s that targeted severely ill life insurance policyholders, life settlements generally involve senior insureds with below average life expectancies. Within such a transaction, both the liability of future contingent premiums and the benefits of a life insurance contract are transferred from the policyholder to a life settlement company, which may further securitize a bundle of these contracts in the capital market. One interesting and puzzling observation is that although life settlements are advertised as a high-return investment with a low “Beta”, the actual market systematically underperformed relative to expectations. While the common explanation in the literature for this gap between anticipated and realized returns falls on the allegedly meager quality of the underlying life expectancy estimates, my third essay “Coherent Pricing of Life Settlements under Asymmetric Information” proposes a different viewpoint: The discrepancy may be explained by adverse selection. Specifically, by assuming information with respect to policyholders’ health states is asymmetric, my model shows that a discrepancy naturally arises in a competitive market when the decision to settle is taken into account for pricing the life settlement transaction, since the life settlement company needs to shift its pricing schedule in order to balance expected profits. I derive practically applicable pricing formulas that account for the policyholder’s decision to settle, and my numerical results reconfirm that---depending on the parameter choices---the impact of asymmetric information on pricing may be considerable. Hence, my results reveal a new angle on the financial analysis of life settlements due to asymmetric information. Hence, all in all, my thesis includes two distinct research strands that both analyze certain economic risks associated with the uncertainty of individuals’ lifetimes---the first at the aggregate level and the second at the individual level. My work contributes to the literature by providing both new insights about how to incorporate lifetime uncertainty into economic models, and new insights about what repercussions---that are in part rather unexpected---this risk factor may have.

Small and medium-sized enterprise is most advanced and vigorous in economic development. It is the main power of GDP growth, which can expand employment, promote technological innovation and strengthen the economic structure non-governmentally. But SMEs have great difficulties accessing finance all over the world. In this dissertation, we aim to compare the foreign trade SMEs betweenSwedenandChina, find the differences between SME financing inSwedenandChina, and try to find solutions to the financing problems inChinafrom the Swedish experience. We takeSwedenandChinaas cases, interview two companies and a bank to collect data and analyze the empirical findings with the Modigiliani-Miller Theorem, trade-off Theory, Packing order Theory, Financing gap, Transaction Cost Theory and Institution economics. Through making a comparison withSweden, we have found that the Aggregate Capital Trust for SMEs is one of the more innovative financial forms inChina, and Chinese SMEs still survive through people-to-people credit.

This article investigates the impacts of asymmetric information within a Lucas (1978) asset pricing economy. Asymmetry enters via the assumption that one group of agents is equipped with superior information about the dividend process. The agents maximize their lifetime utility of the underlying consumption process obtained from the agents' budget constraints, where the agents have the opportunity to invest in a risk asset to transfer income from the current to future periods. Since a closed form solution for the market price cannot be derived analytically, projection methods are applied, as described in Judd (1998), to approximate the expectation integrals in the agents' Euler equation. We derive the result that the informed trader only clearly improves his situation as compared to the non-trade situation if the uninformed trader only observes his own endowment but not the endowment of the informed trader. In the case where agents observe each others' endowment trade never results in a Pareto improvement. (auhtor's abstract) / Series: Working Papers SFB "Adaptive Information Systems and Modelling in Economics and Management Science"

The organic wheat supply chain in Canada operates in a relatively new sector for which there is very little public information to aid in price discovery. Organic wheat producers must use available information in order to decide when to sell their wheat and whom to sell to. The relatively low degree of market information, especially for producers, suggests a problem of information asymmetry, which may have ramifications for efficiency and the distribution of rents in the organic wheat supply chain. The literature on Transaction Cost Economics, Agency Theory and the Economics of Information is used in the thesis to theorize differences between methods of selling organic wheat that vary in terms of vertical coordination. The analysis involves a comparison of selling to large and small grain companies, selling through Producer-Owned Firms (POFs) and selling directly to processors. The theory predicts that producers gain from using a POF because of savings in transaction costs and higher prices. These theorized differences in transaction costs and price are due to increased sharing of information between the producer and the marketing agent, enhanced producer control over the marketer, and incentive for the marketer to provide producers with a high price. These benefits can also be realized by selling directly to a processor, but only if the producer can effectively and efficiently perform his or her own marketing functions. Average cost, price and profit margins are used as a metric for comparing each of the four governance structures. A survey of organic wheat producers in Saskatchewan was undertaken in order to collect data on organic Hard Red Spring Wheat (HRSW) transactions. The results indicate that governance structure has a statistically significant effect on organic HRSW prices and on producer transaction costs. The analysis concludes that the producer receives the greatest profit margin from selling through the vertically coordinated POF, while a marketer receives the greatest profit margin if it operates as a large grain company and purchases HRSW on the spot market. The results also suggest that organic producers that eliminate the middleman and sell directly to processors cannot market as efficiently and effectively compared with producers that use a POF. The results of this thesis emphasize that increased coordination between producer and marketer through a POF can be advantageous for the producer, but not necessarily for the marketer, due to the difference in the distribution of rents.