An Early Assessment of Residential Mortgage Performance in China

The residential mortgage market becomes a financial engine for the booming residential housing development and sustained economic growth in China. Our study provides the first rigorous empirical analysis on the earlier performance of residential mortgage market in China based on a unique micro dataset of mortgage loan history collected from a major residential mortgage lender in China. We found that while the option theory fails to explain prepayment and default behavior in the residential mortgage market in China, other non-option theory related financial economic factors play major roles in determining the prepayment and default risks in China. We also found that borrower’s characteristics are significant in determining prepayment behavior, hence may be used as an effective tool for screening potential high risk borrowers in the loan origination process. Adopting a risk-based pricing in residential mortgage lending in China can improve the efficiency of the market, and enhance the credit availability to the most needed households, i.e., the younger households, blue-collar workers, lower income households, and help them become homeowners.     

Non-linearity in the determinants of capital structure: evidence from UK firms

We demonstrate that, by exploiting more fully the distribution of leverage, conditional quantile regression methods yield new insights into the choice of leverage ratio. For UK listed companies we find that not only is the estimated effect of the explanatory variables different at different quantiles of the distribution, but also that the effect of a variable changes sign between low leveraged and high leveraged firms.      

Accounting information quality and trust as determinants of credit granting to SMEs: the role of external audit

This study analyses whether loan officers’ perception of the accounting information quality (AIQ) and the trustworthiness of SMEs are associated with a better willingness to grant them credit. Empirical evidence is obtained from a survey of 471 bank loan officers in Spain, who are asked to answer in relation to audited and not-audited firms. Using a Structural Equation Modeling (SEM) approach, the results obtained confirm that the loan officers’ willingness to facilitate SMEs’ access to credit is positively influenced by their general perception about the AIQ, but only if it is audited. In the case of not-audited firms, AIQ does not play a direct role in credit granting decision, but is relevant in trust formation. Besides, in the case of audited firms, only the “competence” dimension of trust is relevant, whereas in not-audited firms, both “competence” and “honesty” have an impact on credit granting. “Benevolence” does not have an influence in any case. The study has implications for SMEs, banks, policy makers and auditors.     

Not all family firms are equal: The moderating effect of family involvement on the political risk exposure of the foreign direct investment portfolio. Preliminary evidence from Spanish multinational enterprises

We investigate the effect of political risk (PR) exposure and family control on the internationalization strategy of multinational enterprises (MNEs) using social capital theory. Our results from a negative binomial cross‐sectional analysis in 2007 of Spanish MNEs show family ownership or the limited presence of family members on the board has no effect on internationalization. However, when the conceptualization of family firms (FFs) includes majority ownership and board presence, we find a direct negative effect on their internationalization scope but a positive moderating effect on the relationship between the exposure to PR and internationalization scope. FFs have some specific advantages suitable to be employed in their corporate political activity allowing them to develop long‐lasting relationships with relevant political actors. By disentangling the effects of family control on internationalization and PR, this article explains how FFs can be simultaneously risk‐willing and risk‐averse.     

Comparison of four common data collection techniques to elicit preferences

We compare four common data collection techniques to elicit preferences: the rating of items, the ranking of items, the partitioning of a given amount of points among items, and a reduced form of the technique for comparing items in pairs. University students were randomly assigned a questionnaire employing one of the four techniques. All questionnaires incorporated the same collection of items. The data collected with the four techniques were converted into analogous preference matrices, and analyzed with the Bradley–Terry model. The techniques were evaluated with respect to the fit to the model, the precision and reliability of the item estimates, and the consistency among the produced item sequences. The rating, ranking and budget partitioning techniques performed similarly, whereas the reduced pair comparisons technique performed a little worse. The item sequence produced by the rating technique was very close to the sequence obtained averaging over the three other techniques.     

An analysis of the current backlash of economic globalization in a model with heterogeneous agents

This paper analyzes the current phase of backlash of economic globalization using a target zone approach in an environment populated by heterogeneous agents. The target zone analysis suggests that there may be a positive expectation effect (a ‘honeymoon’) when the social costs are credibly expected to remain below the benefits arising from globalization. In such a situation, the latter proceeds even beyond the level that society would be willing to accept in the absence of a such a target. When the costs are expected to exceed the benefits, instead, the opposite phenomenon (a ‘divorce’) arises. While in the case of exchange rates or interest rates, the passage from ‘honeymoon’ to ‘divorce’ might well occur with a discrete jump of the respective variable, rather than gradually, this is not the case when considering economic and social costs. Graduality is obtained thanks to the introduction of the hypothesis of heterogeneous agents. The proportion of those who think that the costs of globalization exceed the benefits increases with globalization and the ‘honeymoon’’, then, gradually turns into a ‘divorce’. Government's redistributive intervention to compensate the losers, however, could reduce the costs of globalization, thereby delaying or even preventing its crisis.     

ASSESSING THE OLYMPIC GAMES: THE ECONOMIC IMPACT AND BEYOND

This study reviews the literature on the evaluation of the Olympic Games, within the broader framework of their significance as cultural assets and opportunities for endogenous growth and sustainable development of the host city. The study reviews the main approaches to the economic assessment of the Games, from the point of view of the underlying economic concepts and methodologies, as well as of the empirical results obtained. It focuses on the effects that are measured and on those, which even though important, are generally neglected. The methodologies utilized for the quantitative assessments of the Games are reviewed with special emphasis on impact and cost–benefit analysis, both on ex ante and ex post basis. The studies surveyed are analysed from the point of view of different sets of effects on the host city, and for a limited number of cases, on the host country. While the major focus is on hosting the Summer Olympics, some attention is also paid to the bidding cities, the Winter Olympics and the Paralympics. The general findings appear to be controversial with some hints of positive overall effects, but also with a well‐documented tendency to exaggerate the benefits and underestimate the costs of holding the Games in the ex ante versus the ex post studies. The survey finally suggests that ex post cross‐country econometric studies tend to catch sizable differential and persistent benefits ignored by individual studies, especially on macroeconomic and trade variables.     

Tourism satisfaction and perspectives: an exploratory study in Italy

Quality & Quantity - The aim of the paper is to analyze the specific features of tourism in Italy through tourists’ behaviour and satisfaction level and to individuate future...     

How does public service motivation affect teacher self-reported performance in an education system? Evidence from an empirical analysis in Italy

Quality & Quantity - This paper deals with self-reported teacher performance, and the starting point is the relationship between teacher performance and the main determining factor, public...