The Monetary Reform of Hong Kong and Its Enlightenment for Mainland China

The monetary system of Hong Kong has experienced several reforms, now it can effectively control the money supply and restrain inflation. The reform of monetary system is very meaningful for mainland China, as mainland China also wants to restrain inflation. The focus of this article is to analyze the process of monetary system＇s reform of Hong Kong, and the development of money supply system. The conclusion is that central bank of mainland China should learn from Hong Kong＇s experience and carry out more reasonable monetary reform.     

Estimation of Money Demand Function of South Korea Considering Regime Switching

The stability of money demand function is an important issue in macroeconomic policy implementation. Money demand of Korean economy was estimated. Cointegration test with time dummy variables results show that there is not only long-run equilibrium relationship between money demand and macroeconomic variables, but also structural breaks in this equilibrium relationships. Least squares, state-space, and Marcov switching methods show that there also has been instability （or regime shifts） of parameters in money demand, especially over 1997 crisis and the early 2000s. This fact implies that monetary policy for stabilization might encounter big problems due to change （instability） of money demand.     

Interest and profit

This paper argues that it is important to distinguish between the real rate of interest on money and the profitability of business enterprise. The former is a purely financial or monetary phenomenon （as claimed by Keynes） and the latter is in the nature of a surplus over and above the costs of production, including financing costs. There is an inverse relationship between the real rate of interest on money and the average mark-up or profit share. A synthetic theory of profit illustrates these points.     

英文摘要

Can an Increase in Money Supply Cause Price Levels to Rise？ - An Analysis Based on the Wealth Effect of Asset Price Volatility SHENG Songcheng ZHANG Cilan （People＇s Bank of China Shenyang Branch, Shenyang, 110001 ）
Abstract： As the negative impact of international financial crisis being weak, the economy of most countries of the world has had the sign of rebound. The mass money supply aroused people＇s anxiousness about inflation once more.     

Factors affecting profitability of multi-finance company in Indonesia

The aim of this study is to examine the profitabilily of multi-finance companies. This study uses macroeconomic determinants and fundamental variables as factors that affected profitability. The samples of the study was multifinance company in Indonesia over period 2005-2007. The study uses an unbalanced panel data as a methodology. The result suggests that, the ownership of financial assets doesn＇t significantly affect multi-finance performances. This result indicates that multi-finance face difficult situation to generate profit from the credit given. And the result also suggests that all macroeconomic determinants affect multi-finance profitability, with more concern on inflation that have negative significant.     

The Adoption of Virtual Banking in China： An Empirical Study

Virtual banking is broadly defined in this paper as the provision of banking services via means other than that of traditional physical branches. Currently, virtual banking exists in the forms of ATM, phone banking, home banking and Internet banking. Understanding people＇s adoption intention of virtual banking can help financial institutions formulate appropriate marketing strategies for new forms of banking. This paper examines the current trends in the Internet revolution that have set in motion in the Chinese banking sector, and reports on an empirical research carried out in China to study the customers＇ preference for virtual banking and the factors which they consider influence the adoption of virtual banking.     

Mixed Market Competition in a Quality Differentiated Duopoly Model An Approach to Banking Sector

This paper attempts to develop a theoretical framework to investigate the competitive implications of quality choices of financial institutions whereby they charge prices to consumers based on their willingness to pay for the service qualities in the mixed market scenario under vertical product differentiation model. Initially, it analyzes benchmark equilibrium solutions of monopoly and duopoly to establish the degree of quality differentiation between two private banks in an uncover market configuration. Further, it estimates the quality differentiation between private and public banks, and examines the interaction between two market structures keeping public bank as both leader and follower, and then measures the social welfare from different prospectives. The explicit operation of two stages Nash equilibrium game forecasted that public banks＇ monopoly seems to be still better than a private banking, and it is socially optimal. The outcome demonstrates a significant importance of vertical quality differentiation for policy implication in banking industry and provides an insight on the reasons of particular co-existence of public and private banking services in the specified location. In this context, it is concluded that the presence of public banks in banking industries is a crucial condition for obtaining the higher range of social welfare.     

Discussion on the Impact of Revaluing Chinese Currency

This paper discusses how the threat of revaluing Chinese currency would impact China and world＇s economy. The author discusses the issue from 5 perspectives. （1）Revaluing Chinese currency（the renminbi, RMB）would decreases China＇s export and increases its import, which will lead to reduce its foreign exchange reserves, and then bring about import decreasing. China＇s economy will get into recession. China＇s export decreasing means other countries＇ import that come from china will reduce and bring about unfavorable influence on international trade. （2） The RMB appreciation will make re-export products dearer and make China less attractive to foreign investment. （3） Both China＇s banking system and its capital market are under-developed. Revaluing RMB will destabilize China financial market, even though world financial market. （4） If the risk comes from revaluing the RMB become true, it will hinder the transformation of the China＇s foreign exchange system. （5） Priced Chinese exports due to revaluing the RMB will worsen China＇s already grim employment situation. Since above negative influences will produce from Revaluing the RMB, it is wise for China to choose stabilizing the RMB rather then Revaluing the RMB.     

Construction and harmonious development of urban-rural comparing financial systems based on comparative advantages theory

There exist diferences between urban-rural financial systems,Generally,the development of unban financial industry has absolute advanages compared with rural financial industry.According to the Matthew Effect,the financial resources will flow into cities for higher benefit ,so rural areas are unable to obtain absolute advantages However,relative advantage theory of the comparative advantage theory of the comparative advantage theory provides an lmportant way to observe res[ectove advamtage of both city and country.Therefore,there are comparative advantages for the development of financial industry in both urban and rural areas.The respective comparative advantages of urban-rural financial systems will supply greater efficiency than that in current dual puttern condition.Closely connected with China＇s financial development and reform and the fact of recreation of urban-rural financial system,this paper tries to explain the comparative advantage of the urban-rural financial systems.The anaalysis of the comparative advantage between urban and rural finance is the clue for the bonndary between urban-rural financial systems.This paper analyzes the current situration of urban-rural financial system.Then it proposes some views and suggestions on how to develop and maintain these two systemw as well as how to promote their coordinative development.     

Coal price fluctuations and the impact on financial risk Evidence from China＇s coal listed companies

With the rise of coal price, the proportion of loss-making enterprises shows an upward trend in China＇s coal industry. This paper uses Altman Z-Score model to measure financial risk of 19 listed companies in the coal industry in A-share market from 1995 to 2007. Empirical results show that Year-Based price index of coal price has a negative correlation with the financial risk but has no significance, and coal chain price has a significant negative correlation with the financial risk. Further research indicates that enterprises increase bad investment, and a lot of debts caused by short-term rise in coal prices. The results also show that the financial risk in the coal industry declines with the rise of GDP growth rate and increases with the rise of inflation rate.     

英文摘要

On Influence of Marketization of Interest Rate ZHANG Hai-xia, PU Yan China started the reform of marketization of interest rate in 1996. The reform can increase efficiency of monetary policy and promote economic growth and financial innovation, while it brings about some problems and challenges. Marketization of interest rate makes it more difficult for monetary policies to adjust economy and it increases operating risk of business banks. So it is necessary for us to gradually push forward the marketization of interest rate and to decrease the risk.     

Abstract

This paper analyzes central banks＇ balance sheets of China, America, Japan and European Union and discloses their characteristics of structures of liability and asset. It points out the default of liability structure and asset structure respectively, which results in constantly decline of central bank＇s regulation capacity. To avoid further worsening of relations between debts and assets, the People＇s Bank of China must adjust its balance sheet. The measures include： to raise the ratio of ＂issuing currency＂ among ＂Reserve money＂ and total liabilities gradually; to decrease the ration of ＂financial corporate deposits＂ and ＂issuing bonds＂; to specialize ＂the other liabilities＂; to add to the subject of ＂monetary assets＂; to decrease the amount of ＂foreign exchange assets＂ and its ratio to the total assets; to specialize ＂claims on the depositing companies＂ and ＂claims on the other financial companies＂ and increase the quantity of assets allocations to these subjects.     

The Research and Application of the Multi-regression Technique in the Course of Enterprises＇ Marketing Decision-making

The reformation of the economy system has led the functional departments and status of the enterprises into the variance state. Under the condition of the market economy, the kernel of the enterprises＇ functional department has diverted to that of marketing decision-making, which faces to market and meets with the need of consumption. Assuredly, the kernel of marketing decision-making is to prognosticate the future market requirement quantity of the production of enterprises accurately, so that it can ensure and realize the maximum of the enterprises＇ profit to increase. Applying the proof to test demonstration analytical method of economics and adopting the multi-regression technique, this paper analyzes the enterprises＇ production requirement quantity decision-making of the GMC （Global Management Challenge） and changes a great many of uncontrollable factors to the controllable ones of the enterprises. So, it can make the forecast order form closer to the actual prices of the future market requirement quantity in the production marketing decision-making of the enterprises and realize the optimizing combination and the working object with the minimum of the cost and the maximum of the profit. And it can insure the realization of the profit increase of the enterorises mostly in the life-cvcle of the production.     

Empirical analysis on China money multiplier

The paper firstly represents two kind statements of China money multipliers and theoretically analyzes the relationship between each structure factor and China money multiplier. Secondly, it summarizes the several features and the move trends of China narrow and broad money multipliers and their structure factors. Thirdly, the paper empirically analyzes how and what degree the each structure factor affects China narrow and broad money multipliers holding everything else constant. At last two important conclusions are got, that is, the required reserve ratio is the most associated with China money multipliers and the saving deposit ratio is more associated with that, the required reserve ratio and the interest rates can be used as the ways of affecting money aggregate by the People＇s Bank of China.     

ARDL Investigation of Macroeconomic Mechanisms on ASEAN-5 Stock Earnings Equation

The objective of Autoregressive Distributed Lag （ARDL） investigation of macroeconomic mechanisms on ASEAN-5 stock earnings equation can contribute to analyzing and demonstrating macroeconomic forces acting a statistically and economically significant effect on rate of return of securities for a given time through the application of the ARDL approach to cointegration when the variables are mixed degrees of integration in cointegrated time series, i.e. I（0） and I（1）. This results in a long-run or a short-run relationship between macroeconomic force acting for a given time affecting 24 quarterly rates of return for listed companies in Information and Communication Technologies OCT） sector of Stock Exchange of Thailand （SET）, the Kuala Lumpur Composite Index （KLSE） index （Malaysia）, Financial Times Share Index （FTSI）, Philippine Stock Exchange （PSE）, and Jakarta Composite Index （JKSE） （Indonesia）. The impulses of three ASEAN macroeconomic forces---GDPt, EXt, and INTt acting for a given time influence the earnings of selected 23 1CT returns for listed companies on both domestic investments and outsider investments in the same period. This paper has investigated how other-concerning macroeconomic force acting might interrelate with rate of return of securities in the ICT sector, debt and financial innovations, in line with some significant formalized facts. The funding of capital inflow in part of ICT securities was statistically globally significant to recognize significant achievement in ICT specific pathways to distinction as the science of accomplishment. The public sector performing as a key purchaser of ICT security solutions related to integrate the ASEAN exchange members into modern capitalization can lead to adverse effects, such as risky investment-hub interventions due to the mixing financial systems in three ASEAN regional integrations through investments.     

Silent Large Shareholders and Entrenched Bank Management： Evidence from the Banking Crisis in Japan

Since the beginning of the 1990s, Japanese banks have become saddled with huge amounts of non-performing loans and a significant number of them have failed. We investigate the cause of this banking crisis that has jeopardized the stability of the financial and economic system. Following Hanazaki （2001）, we argue that the deficiency of effective corporate governance of banks in Japan has caused inefficient management. Our focus here is the role of large shareholders who happen to be banks and insurers. We argue that these large shareholders appear to collude or conspire with management instead of being tough monitors. Consequently, the management became entrenched. Our empirical results show that during the 1980s these ＂entrenched banks＂ extended more lending. Even after the collapse of the bubble in the 1990s, they did not dramatically undertake restructuring to cope with the accumulated bad loans.     

A study of venue marketing mix for MICE industry in Thailand

The objectives of the research are to determine the important factors and the performance factors of the attributes in selecting venues （particularly convention hotels and convention centers） through investigating the meeting planners＇ set of needs and to identify factors and attributes relating to the venue marketing mix for MICE industry in Thailand. This paper has applied the hospitality and the tourism marketing mixes that are important to the MICE destination selection （particularly venues） for creating a new venue marketing mix. Therefore, the study is based on the importance levels of venue selection through each marketing mix factors including all attributes in the meeting planners＇ perspectives on behalf of their organizations, which will be able to reflect a set of their real needs that could bring about development of a venue marketing mix model that exclusively accommodates MICE organizers. The data was collected using self-administered questionnaires from 229 meeting planners. Statistically significant determinants of the meeting planners＇ overall importance levels indicated that in all of the 8 marketing mix factors （68 attributes）, the people factor was perceived to be the most important factor. The package factor was perceived to have a moderate level of importance. The other factors perceived to be important included Product, Price, Place, Promotion, Physical evidence and Process. It is also found from the factor analysis that the new venue marketing mix contained 8 marketing mix factors with 61 attributes for venue business in Thailand. It is recommended from the research findings that venue management be more concerned with and focus on the attributes of the people factor.     

Return to Endogenous Financial System via Corporate Bonds

After 35 years＇ reform and development, China has established an ＂exogenous＂ financial system. This type of financial system was created outside of real economy rather than derived from its inherent demand. To improve the role of market mechanism in allocation of financial resources, China＇s financial system must be reformed to be endogenous in real economy, which means, expanding the financial options available to enterprises and households so that they can compete with financial institutions such as commercial banks in financial market. Corporate bonds, with their advantages in matching the supply and demand of funds, can play important role in cultivate the endogenous financial system com- bined with real economy.     

Effective Management of Own Funds in Polish Cooperative Banks

Today cooperative banks belong to the most significant financial institution in the world. Moreover, they can compete with commercial banks. The own funds of the cooperative bank are important in their activity. The main goal of this paper is to investigate how much the level of the own funds of the Polish cooperative banks influenced their efficiency. The research pertained to operating cooperative banks in Poland. The following measures of the efficiency were used in the research： return on Equity （ROE）, net profit, index C/I, and financial margin. The results of the study indicate that banks from the Quartile III （highest aggregate own funds）, had the highest net profits, the highest ROE, the lowest C/I value, the lowest ROE, and the lowest financial markups. On this basis, it remains to be recommended that banks of highest aggregate own funds continue expansion of own funds which will increase lending capacity and subsequently contribute to higher effectiveness.