Bank versus nonbank financial institution lending behaviour: indictors of firm size,risk or ownership?

Using 1251 matched commercial loan deal terms of listed companies over the period 2003–2014, we examine the heterogeneity of lending behaviours of bank and nonbank financial institutions. The results show that large firms have a higher likelihood of getting loans from nonbank financial institutions. Compared to banks, nonbank financial institutions are more likely to provide credit help to high operation risk firms. State-owned listed firms have a higher probability to get finance from nonbank financial institutions than private firms, which highlights the situation that private firms are in a weak position to get credit help from China’s financial system. Moreover, the process of increasing the banks’ noninterest income ratio tends to drives firms to borrow from nonbank financial institutions.     

Financial Innovation,Deposit Deregulation,and the US M1-GNP Link

This paper considers the effect of financial liberalization on aggregate consumption, with a special focus on Taiwan, which has sustained a high savings rate and a rapid rate of economic growth under financial dualism, but has undertaken financial liberalization since the 1980s, leading to an expansion of the formal financial sector. The paper finds that, because of an active informal financial sector, consumers in Taiwan are less credit constrained than in other developing countries. However, the expansion of the formal financial sector has contributed to some relaxation of consumer credit constraints and thereby changes in the income and interest elasticities of consumption. It also has brought about a higher consumption growth rate, offsetting at least partially the positive growth effect of financial liberalization, which helps improve the efficiency in finanacial intermediation.     

Firm performance and corporate finance in New Zealand

Low productivity growth in New Zealand has been a paradox. We study New Zealand firms’ profitability, in terms of profit margin and return on assets (ROA), from the viewpoints of productivity enablers using firm-level panel data. We find that tangible fixed investment and a research and development (R&D) tax incentive are associated with higher profitability performance. In addition, the firm size is found to be a key determinant of profit margin. By contrast, we do not find any evidence that intangible investment can improve the profitability. The global financial crisis has not changed the leverage effect on ROA in New Zealand, while the impact of R&D became more prominent after the crisis.     

吉林省中小金融机构经营效率评价

效率是金融机构核心竞争力的重要内容。本文运用因子分析法,对吉林省境内各类中小金融机构和国有大银行的相关效率指标进行了对比分析,得出吉林省中小金融机构的经营效率普遍高于国有大银行的结论。同时发现,吉林省的中小金融机构面临的主要问题依然是如何降低不良贷款率、提高资产质量。本文最後提出了完善公司治理结构、健全内部控制制度和突出区域特色的业务定位三个方面,是改追吉林省中小金融机构的效率的有效措施。     

Rio plus Ten: Politics,Poverty, and Environment

The purpose of this paper is to contrast the work of Douglass North and Karl Polanyi regarding financial institutions associated in market economies. Both implicitly acknowledge the synergy between public and private financial markets, which can serve to solidify an alliance between wealth holders and the state, potentially at the expense of “sociery” at large. This alliance may stimulate growth, according to North, as well as impose the strain of the market, according to Polanyi. Taken together, these insights undercut the classical story of the neutral role of money, as well as the notion of a clear distinction between public and private, politics and markets.     

Financing of innovation: national development banks in newly industrialized countries of East Asia

Abstract

Contemporary literature on innovation tends to overlook the issue of financing, whereas financial history suggests that banks have been essential to financing of new industries. Emerging literature ondevelopment banking, although inspiring, remains focused on financing policies. The article aims to rearticulate a coevolutionary nature of industrial and financial interests, following the works of Schumpeter and Minsky, by looking at the 4 cases of national development banks, tasked with long-term financing of industries, from newly industrialized countries of East Asia—South Korea, Taiwan, Singapore, and Malaysia. The study suggests that innovation in finance, as well as organizational innovation in financial institutions, represent essential elements of financing of innovative activities. Further, organizational innovation in financial institutions, such as development banks, might signify a disposition to face uncertainty, which characterizes economic and technological unknowns inherent in financing of innovation.     

Trust,cultural norms and financial institutions in rural communities: the case of Cameroon

The success of the operations of formal and informal financial institutions (IFIs) hinges on a high degree of trust. The pivotal role of trust warrants careful analysis regarding its formation in these financial institutions. Using the case of Cameroon, the paper interrogates trust development between formal financial institutions and their clients, and between IFIs and their members. Trust formation occurs via certain cognitive trust-building processes: calculative, prediction, intentionality, capability, and transference processes. The paper argues that trust formation through these processes is predicated upon cultural values and beliefs. It is precisely because of cultural norms that traditional leaders play a role in ensuring that loans granted by formal financial institutions are repaid, thereby serving as principal actors in the functioning of financial capitalism in rural areas. The interplay between culture and financial institutions reconfigures the financial architecture in rural zones. Culture creates a social relational anthropology that is significant for how financial institutions operate.     

Analysis of long-run benefits from international equity diversification between Taiwan and its major European trading partners: an empirical note

This paper employs four cointegration test approaches, PO, HI, JJ and KSS, to test for pairwise long-run equilibrium relationships between Taiwan's stock price index and each of the stock price indexes of four European markets – French, German, Dutch, and British stock markets. The results from these four tests are robust and clearly consistent in suggesting that the Taiwan stock market is not pairwise cointegrated with the four European stock markets. This provides strong evidence that there exist long-run benefits for Taiwan investors diversifying in the equity markets of Taiwan's major European trading partners, France, Germany, Holland, and the UK, over the sample period considered from 6 January 1998 to 30 May 2002. These findings could be valuable to Taiwan individual investors and financial institutions holding long-run investment portfolios in the equity markets of France, Germany, Holland, and the UK.     

产权、金融稳定政策与中央银行独立性

This paper builds a micro-behavior model of central bank and financial institutions from the perspective of property-rights. By analyzing the theoretical model and the practice, we conclude that, in the framework of the present financial stabilization policies in China, the central bank’s functions of monetary policy and financial stabilization are enslaved to financial institutions. Thus, central bank independence has been damaged because of the actual property-right relation between the central bank and the financial institutions. The policy implication is to cut off the property-right relation between the central bank and the financial institutions. __________ Translated from Caijing wenti yanjiu 财经问题研究 (Research on Finanical and Economic Issues), 2007, (6): 3–9     

Why not a political Coase theorem? Social conflict, commitment, and politics

Do societies choose inefficient policies and institutions? An extension of the Coase theorem to politics would suggest the answer is no. This paper discusses various approaches to political economy and develops the argument that there are strong empirical and theoretical grounds for believing that inefficient policies and institutions are prevalent. We conclude that these inefficient institutions and policies are chosen because they serve the interests of politicians or social groups that hold political power at the expense of the rest. The theoretical case depends on commitment problems inherent in politics; parties holding political power cannot make commitments to bind their future actions because there is no outside agency with the coercive capacity to enforce such arrangements. Journal of Comparative Economics 31 (4) (2003) 620–652.     

居民对中、外资金融机构的比较评价研究——来自中国九个城市的证据

Between domestic financial institutions and foreign or joint venture ones in China, which ones do Chinese people give better assessment to? And what factors affect those comparative assessments? With a household survey in nine cities in China in 2006, we find that China’s domestic financial institutions are considered better than foreign or joint venture ones in terms of financial products, communication with investors, security and prudence, operation standardization and service attitudes. When taken into account the endogeneity of people’s trust on government regulation agencies, empirical results show that people’s more attention to returns or the more trust on government regulation agencies leads to their better assessments on domestic financial institutions than foreign or joint venture ones. The policy implications are: Chinese governments have to take measures to improve residents’ trust in governmental regulation and create a fair competition environment for domestic and foreign financial institutions in China. Domestic and foreign financial institutions make efforts to develop a higher rate-of-return and attractive financial products to service more customers.     

Performance of Thailand banks after the 1997 East Asian financial crisis

The performance of commercial banks and government-owned specialized banks in Thailand is estimated after the 1997 East Asian financial crisis. Commercial banks exhibit increasing returns to scale, whereas government-owned specialized banks exhibit decreasing returns to scale, implying further increases in bank size and market concentration in the commercial bank sector but not for government specialized banks. Cost inefficiency varies by bank and is a function of the ratio of nonperforming loans (NPLs) to total loans, equity to total assets and liquid assets to total assets, as well as the number of branches. On average, banks with fewer NPLs, that are well capitalized and with adequate liquidity are efficient. Thus, stricter rules to regulate credit risk management and ensure capital and liquidity adequacy would enhance efficiency in the banking sector. Although estimated input substitutability appears to be low, labour and loanable fund are substitutes. However, labour and physical capital as well as physical and loanable funds are complements in commercial banks. All the three inputs of labour, physical capital and loanable funds are substitutes for the government specialized banks.     

Sovereign Wealth in Abu Dhabi

By the turn of the century, oil had already made the tiny emirate of Abu Dhabi rich beyond anyone's wildest dreams. A sovereign wealth fund, the Abu Dhabi Investment Authority (ADIA), has invested extra oil revenues abroad for more than thirty years and amassed a still-growing portfolio worth approximately $750–900 billion. ADIA is widely believed to be the world's largest sovereign wealth fund – indeed the world's largest institutional investor. But Abu Dhabi is not yet a “developed” economy. So, in 2002, the Mubadala Development Company was established as a government-owned investment vehicle. Unlike ADIA's mandate to build and manage a financial portfolio, Mubadala's charge was to develop Abu Dhabi. According to some observers, ADIA was a “sovereign savings fund,” while Mubadala was a government-owned investment firm. Mubadala is supposed to invest the wealth of the emirate in activities that would diversify the economy away from energy and into industry and services. Although each Mubadala investment is supposed to earn large returns, the strategy balances financial against “strategic” returns. ADIA and Mubadala are the institutional architecture to manage the wealth of the Abu Dhabi sovereign.     

境外大股东持股与股价同步性研究

以2006-2010年的中国所有上市公司为研究对象,采用多种方法分析境外大股东与股价同步性的关系。结果发现：首先,境外大股东在来源地方面具有显著的地缘特征和经贸关系特征;其次,行业不同股价同步性呈现出较大差异,如采掘业、金融业的股价同步性很高,而制造业、批发零售业相对较小;再次,境外大股东持股与股价同步性呈显著负相关性;最后,来自非港澳台的直接境外大股东对股价同步性有更大的影响,而直接境外大股东是否为金融机构差异不明显。     

The effect of political volatility on capital markets in EU accession and neighborhood countries

Political instability has the potential to disrupt financial markets. But how do political institutions affect financial movements in an environment where all institutions are in flux? This paper looks at the effects of formal and informal political volatility in the new EU countries of central and eastern Europe, in the Eastern Neighborhood, and farther afield in Central Asia to answer this question. Using asymmetric GARCH modeling on monthly data, I find that informal political volatility has a significant negative effect on stock returns, while formal political institutions generate much higher financial volatility than changes in monetary policy.     

Program duplication in higher education is not necessarily bad

Public systems of higher education have recently attempted to cut costs by providing financial incentives to cut duplicated programs, i.e. programs that are offered at different institutions. We study the profit and welfare effects of reducing program duplication, against the background of a funding system reform in Flanders (Belgium). We find that dropping duplicated programs at individual institutions tends to be socially undesirable, due to the students’ low willingness to travel to other institutions and to the limited fixed cost and variable cost savings. Furthermore, we find that the financial incentives offered to drop programs may be very ineffective, leading to both undesirable reform and undesirable status quo. These findings emphasize the complexities in regulating product diversity in higher education, and serve as a word of caution towards the various decentralized financial incentive schemes that have recently been introduced.     

The International Labour Organization and the ambivalent politics of financial inclusion in West Africa

This article examines the role of the International Labour Organization (ILO) in promoting ‘financial inclusion’ in West Africa. The role of the ILO in microfinance and financial inclusion has often been overlooked, in contrast to the role played by the World Bank, G20 and like institutions. The ILO is significant here because it suggests a number of ambiguities and important political dynamics that have gone overlooked in previous critical discussions of microcredit, which have often focused on the politics of commercialisation, indebtedness and accumulation by dispossession. This article draws instead on Gramsci’s concepts of subalternity and organic crisis to suggest that the politics of ‘financial inclusion’ in practice are often shaped as much by the political dynamics engendered by the erosion of postcolonial order as by the imperatives of accumulation. The argument is illustrated empirically by examining ILO activities on microinsurance and ‘inclusive finance for workers’ in West Africa, with an emphasis on Senegal.     

监管资本、经济资本及监管套利——妥协与对抗中演进的巴塞尔协议

巴塞尔协议演进是以国际清算银行(BIS)为代表的金融监管机构与金融机构对抗与妥协的结果。经济资本就相当于银行等金融机构以防破产所自愿购买的持久美式卖出期权的价格,而监管资本则可以看作监管当局要求金融机构购买期权价格。监管资本与经济资本之间背离程度一旦超出金融机构的承受水平,监管套利行为就会充斥金融市场,导致金融危机。如果金融机构经济资本的测算和配置充分考虑到系统风险因素,经济资本与监管资本趋于相同。     

Financial development,financial liberalization and social capital

The relationship between financial liberalization policies and financial development is controversial. The impact of these policies differs greatly across countries. In the literature, the quality of formal institutions has been identified as an important source of this heterogeneity, as countries with a weak institutional environment generally fail to benefit from financial liberalization. Using panel data covering 82 countries for the period 1973–2008, we find evidence that social capital may substitute for formal institutions as a prerequisite for effective financial liberalization policies. In particular, we find that during the post Washington-consensus period countries with a high prevailing level of social capital can ensure that financial liberalization positively influences financial development, despite the poor quality of their formal institutions.     

Does direct democracy make for better citizens? A cautionary warning based on cross-country evidence

It has been shown that both formal existence and actual use of direct democratic institutions have effects on a number of variables such as fiscal policies, quality of governance but also economic growth. Further, it has been argued that direct democratic institutions would not only have an impact on policy outcomes but influence citizen participation and attitudes toward politics. For the first time, these conjectures are tested in a large cross-country sample here. Overall, we do not find strong effects and some of the significant correlations are rather small substantially. In contrast to previous studies, voter turnout is not higher when direct democracy is available or used. Further, and also in contrast to previous studies, citizens do not express a greater interest in politics in countries with direct democracy institutions. Finally, they display lower trust in government and parties but not in parliament. These results shed some doubt on the hope that direct democracy would make for better citizens.