Income variability and selection of the pension system

This paper provides a simple two‐period, game theoretic set‐up with heterogeneous agents to analyse individual selection of a pension scheme by different categories of agents. Agents have been differentiated according to their income variability. We describe Bayesian equilibria and provide examples to illustrate. The design of a pension scheme requires the consent of all the population, and we have shown that differences of volatility of income contribute to the divergence regarding the decision of a pension investment alternative. We also provide support for the subsistence of unfunded scheme in economies with demographic aging and with promising returns in funded alternatives.     

North–South terms‐of‐trade trends from 1960 to 2006

The composition of exports of developing countries is increasingly dominated by manufactured goods. This has not changed the fact that their major trading partners continue to be the developed countries. In order to properly assess the distribution of gains from trade, there is a pressing need to analyze the movements in the terms of trade of developing countries with respect to the developed ones. A statistical analysis of the North–South terms of trade reveals that the terms of trade have turned against the South since the 1960s. However, the terms‐of‐trade deterioration is neither continuous nor evenly distributed over different country groupings. The existence of a structural break in the mid‐to‐late 1970s together with the greatest adverse terms‐of‐trade movements against the highly indebted and least developed countries attest the discontinuity and unevenness of this process.     

Predatory mortgage lending

Regulators express growing concern over predatory loans, which we take to mean loans that borrowers should decline. Using a model of consumer credit in which such lending is possible, we identify the circumstances in which it arises both with and without competition. We find that predatory lending is associated with highly collateralized loans, inefficient refinancing of subprime loans, lending without due regard to ability to pay, prepayment penalties, balloon payments, and poorly informed borrowers. Under most circumstances competition among lenders attenuates predatory lending. We use our model to analyze the effects of legislative interventions.     

Betrayal in buyer–seller relationships: Exploring its causes,symptoms, forms,effects, and therapies

Building on literature in social psychology that discussed betrayal in interpersonal relationships, this article explored betrayal in buyer–seller relationships using data collected from a survey conducted among 109 buyers and 115 sellers in the United States. The results indicated that betrayal was a complex, multifarious, and dynamic phenomenon, consisting of a sequence of phases, namely causes, symptoms, forms, consequences, and therapies, with multiple issues being involved at each phase. Our study also revealed that the views of buyers differed from those of sellers in terms of how various relational characteristics contributed to the emergence of betrayal episodes, what behavior and attitudes helped to diagnose partner betrayal, in which forms the betrayal acts were manifested, how the victims of betrayal felt, and how betrayal problems could be handled in a working relationship. In fact, the various dimensions in each of the betrayal phases examined were consistently more frequently mentioned by buyers than sellers.     

Innovation,networking and the new industrial clusters: the characteristics of networks and local innovation capabilities in the Turkish industrial clusters

Elaborating on the literature on industrial districts, this paper suggests that innovation and networking are the two key issues, which provide the new generation industrial clusters’ competitive capacity in the globalization process. The paper presents the findings on the innovative and networking capabilities of the three important industrial clusters of Turkey based on the data collected from the sample firms in each of these industrial clusters through in-depth interviews. The findings clearly show the importance of local and national networking as well as global linkages and confirm the positive relation between intensity of local networking and innovativeness. Moreover, the paper provides evidence that firms within global networks have higher numbers of innovations than firms with higher intensity of locally embedded linkages.     

Relationship between economic indicators and volume of mortgage loans in Turkey

The primary purpose of this research is to identify the relationship between economic indicators and volume of mortgage loans in Turkish housing market. The economic indicators, which are used in the study, are mortgage loan rates, 12-month interest rate of Treasury bill, consumer price index, consumer confidence index, gross domestic product and monetary aggregate （M2） for the period January 2002 through December 2009.     

Currency crises and monetary policy: A study on advanced and emerging economies

The studies regarding the appropriate monetary policy response in defending the domestic currency following a currency crisis do not gather around a robust answer. This study tries to emphasize the notion that there is no single policy applicable for all currency crises happened and happening in the global world. The approach of the study is presenting empirical evidence by focusing separately on the advanced and emerging economies and proving that the monetary policy response for the emerging economies should be different from the advanced economies, depending mainly on the vulnerabilities of these economies preceding and during the crisis periods. The study includes twenty four economies, in which fifteen of them are emerging and nine of them are advanced, for the crisis periods between 1986 and 2009. The main finding of the study is that the tight monetary policy is effective in the advanced economies, and detrimental in the emerging economies faced financial turbulence. The monetary policy has no significance in recent crisis episodes both for advanced and emerging economies. Advanced economies besides having more independent central banking, lower country riskiness and almost no default history; mainly have second generation model weaknesses which cause the increased interest rates to be successful in stabilizing the exchange rates. For the emerging economies the third generation model weaknesses play a major role together with the first generation model vulnerabilities. Thus the major policy implication follows that the policy makers should take into account the economic fragilities during the crisis in implementing the monetary policy.