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Extends the notion of informality into the area of illegality, looking at how illegal crack vendors in New York use informality to reduce and pass risk to others. Focuses on the techniques used to avoid detection and arrest and the methods of placing risk of imprisonment on smaller, lower‐income dealers. Suggests that this process of exploitation only makes sense when seen in the broader context of inequality in US society where some have nothing to lose by going to jail.

Superior firms are those which create shareholder wealth. The most direct way to measure shareholder wealth is by examining the worth of dividends plus share‐price appreciation. The authors contend that the companies chosen as excellent by Peters and Waterman, in their book, In Search of Excellence, fail to show superior shareholder wealth creation.

Much attention has recently been directed toward the relationship between the performance of firms and compensation received by their respective CEOs. We assess this relationship for commercial banks, as regulatory and other industry‐specific conditions can cause the performance‐compensation linkage in the banking industry to differ from that of industrial firms. We find that the accumulated human capital of CEOs and the bank size are positively related to the total compensation (including salary, bonus, and stock options) levels of bank CEOs. We also find a positive significant relationship between bank accounting performance proxies and CEO compensation level for all time horizons. Finally, we find a positive significant relationship between market‐based performance proxy and bank compensation.