The suspension of borrowing: an implicit penalty for loan default under imperfect information

A credit seeker may be suspended from borrowing for a period of time due to a previous default. Such suspension is widely used in bank lending through credit check. Our work analyses the effects of suspension on the investment choice of borrowers under uncertainty and on the lending policy of banks facing asymmetric information. We show that suspension should be tightened at low loan rates, but loosened otherwise, to improve the repayment performance of borrowers. We also show that although credit rationing may not be completely removed due to imperfect information, the excess demand for credit or transitive waiting in the market can actually be attenuated by such efficient use of suspension. Our theoretical predictions are consistent with observed cyclical patterns of changes in lendingrates and suspension severity.     

Heterogeneous human capital, uncertainty, and the structure of plans: A market process approach to marriage and divorce

The family has not been exempt from the multiple and rapidly occurring changes in the world today, particularly in market economies. The number of marriages has declined, age at first marriage has risen, the number of divorces has risen sharply, the fertility rate has declined, and the division of labor within families has changed, not always in ways that might be expected. This paper subjects these developments to a market process analysis, drawing on the voluminous work occurring in family economics. The Austrian theory of capital, with its emphasis on capital heterogeneity, is relevant. We place particular emphasis on the importance of the structure of human capital within marriage and how investments in such human capital have been affected by the uncertainty that these changes have produced. We also examine investments in marriage-specific human capital and in general human capital (particularly as they relate to childcare). This is then related to the incidence of divorce and the causes and spoils from divorce. The advent of no-fault divorce seems to have been seminal in this regard. We end with a brief glance at the future.

Employee treatment and the choice of liquidity: lines of credit versus cash holdings

By examining the relation between the employee welfare index and the choice between lines of credit (LC) and cash holdings, we provide empirical findings consistent with monitored liquidity insurance, agency, and tax theories. There is a negative relation between the LC-to-cash ratio and the employee treatment index, which is more pronounced for firms with large intangible assets. Additionally, this negative relation is observed only in low agency firms, which is consistent with the prediction of agency theory of cash holdings. Firms increase LC to meet future investment opportunities rather than increasing cash holdings when their marginal tax rates are high.     

The incidence of import liberalization with and without a value added tax: an application to bangladesh

This paper examines the impact of import tariffs and tariff-replacing indirect taxes on the welfare of households grouped by the size distribution of income. A computable general equilibrium model for Bangladesh is simulated to examine the removal of quantitative restrictions and tariffs as well as the replacement of trade taxes with a value added tax (VAT). Import liberalization alone expands the manufacturing sector and increases the welfare of lower income households. If a uniform VAT is placed on both imports and all non-agricultural production in order to replace the lost tariff revenue for the government, some of the gains from import liberalization are diminished. If exports are exempted from the VAT, the gains are sustained to a greater degree. With a combination of tariff liberalization, quota markups, and the VAT, the economy goes through a contraction and the welfare of all households is reduced.     

The role of credit constraints and government subsidies in farmland valuations in the US: an options pricing model approach

The Modigliani–Miller (M–M) theorem of financial asset theory concludes that asset values are independent of financing. In other words, debt-solvency (credit constraints) does not affect asset values. Therefore, using the M–M theorem one can argue that credit constraints in the farm sector (where land is the most important asset) do not affect the value of farmland. However, this proof relies on several arbitrage assumptions that are violated in the case of agricultural assets. This paper examines the effect of debt-solvency and government payments on changes in annual farmland values by state in the United States. Using panel cointergration method, results indicate that farmland values are significantly affected by both solvency and government payments. In addition, the results imply that government payments may affect agricultural asset values beyond the direct effect hypothesized in the literature.      

Between European integration and regional autonomy: the case of Italy from an economic perspective

Italy has experienced a double political phenomenon over the last few decades: a transfer of powers to a supranational entity (the EU) and a move towards regional autonomy. This paper aims to evaluate how policy competences are attributed to and exercised by the European, national and regional institutions. It develops a set of quantitative indicators analysing the legislative production of the EU, the Italian parliament and the Italian regions in various policy areas. The main findings indicate a certain substitutability between European and national legislation and that different levels of government share competences in a larger number of sectors than suggested by the economic theory.

地方财政健康与财政分权——基于湖北省县级数据的实证研究

比较准确评估地方财政收支状况是改革完善地方财政制度的基础。借鉴Ladd和Yinger的财政健康分析方法对湖北省县(市)财政健康进行评估,发现样本期间县(市)财政健康水平呈先降后升形态,且县(市)财政健康水平总体仍较低。进一步的实证研究显示,财政分权和省直管县财政改革都显著地提升了县(市)财政健康水平。为增进地方财政健康度,应科学界定地方政府的事权与财权,完善省以下分税制,构建合意的转移支付制度和地方债制度,同时深化地方财政及行政层级改革,建立扁平化的地方财政及行政管理体制。     

Consistency and optimality in a dynamic game of pollution control I: Competition

I model the interaction between a regulator and polluting firms as a Stackelberg differential game in which the regulator leads. The firms create pollution, which results in a stock extermality. I analyze the intertemporal effects of alternate pollution control measures in a competitive industry. The principal issue here concerns the dynamic inconsistency of the optimal solution. Inter alia, I compare the steady state levels of pollution under optimal and under time consistent policies.     

On the endogeneity of an exogenous OCA-criterion: specialisation and the correlation of regional business cycles in Europe

This paper examines whether changes in the degree of correlation of employment cycles across regions (of Belgium, France, Germany, Ireland, the Netherlands, and Spain) can be explained by changing patterns of specialisation. The empirical method adopted carries out pooled regressions for all possible region-pairs which relate moving correlations between the residuals of HP-filtered regional employment to their own past and an index of specialisation. As a test of robustness, the benchmark estimations which originally include dummies for common borders, German unification and relative differences between regional incomes are systematically tested down. The empirical results again highlight the problem of a common monetary policy for uncommon regions within the euro zone.

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The authors would like to thank an anonymous referee and the participants in the annual NOEG conference in Innsbruck for helpful comments.     

Measuring the welfare effects of tax changes using the LES: An application to a carbon tax

This paper explores the use of a parametric approach to the measurement of compensating and equivalent variations resulting from price changes. The approach is based on the application of the Linear Expenditure System (LES) to each of a range of household income groups, rather than being based on a representative consumer. The method is then used to examine the distributional effects of a carbon tax, designed to reduce carbon dioxide emissions. The price changes resulting from a carbon tax depend on the carbon intensities of each good, which depend in turn on the nature of inter-industry transactions (the input-output matrix). The use of transfer payments to compensate for adverse distributional effects of a carbon tax is investigated, using social welfare functions based on equivalent incomes.     

促进主体功能区建设的财政政策研究--以黑龙江省为例

主体功能区发展是国家或地区一个重要的建设目标。黑龙江省主体功能区划分为重点、限制和禁止等三类开发区,但因其财政投资总量不足、财政支出结构失衡、转移支付功能弱化和生态补偿机制缺位等问题,在一定程度上影响了主体功能区的发展水平。在借鉴发达国家及有关省市区域财政政策经验的基础上,提出了加大财政投入力度、优化财政支出结构、规范转移支付制度、建立生态补偿机制和完善其他财政政策等促进黑龙江省主体功能区发展的财政政策建议,旨在为有关部门提供决策参考。     

Education budget savings from ending child marriage and early childbirths: the case of Niger

Ending child marriage and early childbirths would reduce total fertility rates and population growth especially in countries with a high incidence of child marriage, early childbirths, or both. Savings for public budgets could be large. This article relies on demographic projections and a UNESCO costing model for the provision of education by governments to estimate savings that could result from ending child marriage and early childbirths for public education budgets. The analysis is conducted for Niger, the country with the highest rate of child marriage in the world.     

Tourism as an alternative source of regional growth in Portugal: a panel data analysis at NUTS II and III levels

The role of tourism is of vital economic importance, particularly for small countries with a privileged geographical location and favourable weather conditions. This paper examines the importance of tourism as a conditioning factor for higher regional growth in Portugal by employing the conditional convergence hypothesis of Barro and Sala-i-Martin, associated with the endogenous growth theory. The panel data estimation approach provides evidence of the positive impact of tourism (through the accommodation capacity) on the growth in per-capita income among the Portuguese regions, increasing the rate of convergence. Therefore, tourism can be considered as an alternative source for stimulating higher regional growth in Portugal, if the supply characteristics of this sector are improved.     

Bank risk proxies and the crisis of 2007/09: a comparison

The global financial crisis has again shown that it is important to understand the emergence and measurement of risks in the banking sector. However, there is no consensus in the literature which risk proxy works best at the level of the individual bank. A commonly used measure in applied work is the Z-score, which might suffer from calculation issues given poor data quality. Motivated by the variety of bank risk proxies, our analysis reveals that nonperforming assets are a well-suited complement to the Z-score in studies of bank risk.     

Pitfalls and potential of institutional change: Rain-index insurance and the sustainability of rangeland management

Rain-index insurance is strongly advocated in many parts of the developing world to help farmers to cope with climatic risk that prevails in (semi-)arid rangelands due to low and highly uncertain rainfall. We present a modeling analysis of how the availability of rain-index insurance affects the sustainability of rangeland management. We show that a rain-index insurance with frequent payoffs, i.e. a high strike level, leads to the choice of less sustainable grazing management than without insurance available. However, rain-index insurance with a low to medium strike level enhances the farmer's well-being while not impairing the sustainability of rangeland management.     

Capitalism and democracy in the 21st century: a Kaleckian interpretation of a Schumpeterian problem

The paper reinterprets Schumpeter's views on the dynamic effects of taxation, as originally expressed in Crisis of the Tax State, from a Kaleckian perspective. In light of Schumpeter's rejection of Keynesian and Marshallian approaches to taxation, the paper argues that a recently developed Kaleckian approach provides an appropriate basis from which to analyse the effects on the business cycle of balanced changes in the structure of taxation. It is shown that, under certain shifting assumptions, increases in the taxation of wages or profits will stimulate investment and attenuate the amplitude of the business cycle. Ultimately, the shifting of taxes reduces to a conflict over income shares. The changing distribution of income in the United Kingdom in recent years suggests that investment is likely to remain sluggish unless there is a significant reversal of income shares. This may give rise to increasing economic and political tensions into the 21st century.     

Natural capital and quality of life: a model for evaluating the sustainability of alternative regional development paths

Natural capital contributes to the quality of life of a region in two complementary ways: first, by directly providing environmental services that cannot be imported, and second, by supplying the natural resources that, through a human controlled production process, become valuable to humans. The evolution of the combination of these two components of the quality of life determines the path of development a region takes. Environmental services also determine the ability of natural capital to regenerate itself. Ecosystems and other components of the regional natural capital produce environmental services that provide life-support functions necessary for natural capital reproduction. The destruction of this critical natural capital impairs the internal sources of improvement of the quality of life of a region, leading to a non-sustainable path of development. This article describes a model of the relationship between natural capital and quality of life that provides a stricter definition of sustainable development through explicit characterization and classification of natural capital according to its ability to produce life-supporting environmental services, by its substitutability, and by its possible reconstruction. Application of this model then shows that there are 51 possible regional development paths, only 32 of which are sustainable and only 14 of which are sustainable while also providing improvements in quality of life. Only six of these 14 sustainable development paths are attained with economic growth, however, while the other eight paths increase quality of life by increasing the production of environmental services. The model could help in the development of institutional interventions that would promote regional development paths that are sustainable.     

健康旅游耦合协调度与空间分异研究——以云南省为例

伴随人们健康关注度的提升,健康旅游已成为支撑全球旅游业发展的重要力量。论文旨在构建健康旅游发展评价指标体系,采用熵值法、耦合协调度、全局莫兰指数等多种计量方法,对2009—2018年云南省16个州市健康旅游发展水平的时空分异特征与影响因素进行研究,结果表明:产业发展水平对云南省健康旅游的影响大于服务发展水平和环境质量因素,导致发展内驱力有所不足;云南省各州市健康旅游发展变化趋势不同,呈现稳健性、正V型、倒V型三种类型,三者区域数量呈现梯度减少;云南省健康旅游发展协调性较差,多数处于互补类和附加类,并且多属于产业型发展模式;云南省健康旅游发展呈现先聚集、后分散的变化趋势,正在由单中心发展向多中心的发展演化。     

Substitutability and weighting of ecological and economic indicators: Exploring the importance of various components of a synthetic index

The establishment of an information system is meaningful to develop a dynamic assessment of environmental quality and degradation. In this paper an original, empirical framework called Factor Weighting Model (FWM) is proposed to integrate different indicators into a composite index. The FWM is able to work with variables depicting different themes (e.g. climate, soil, landscape, demography, economy) collected at various geographical and temporal scales. Three case studies carried out at different spatial scales were considered as examples of FWM application to a composite index of Land Degradation. It consists of several variables collected from various data sources and available at different temporal and spatial scales, which are aggregated into some thematic indicators. The FWM approach was applied separately for each case study to the single variables transformed into sensitivity indicators through standard procedures. A multiway factor analysis (MDA) was carried out to explore over time the relationships among indicators. The importance of the environmental indicators was estimated by attributing a percent weight to each of them according to MDA outputs. Climate and soil dimensions account for the highest weights in all the cases considered. These findings are in accordance with the results obtained in previous studies. The implications of FWM in the assessment of environmental quality are finally discussed.     

Health and economic impact of PHiD-CV in Canada and the UK: a Markov modelling exercise

Abstract

Objective:

The spectrum of diseases caused by Streptococcus pneumoniae and non-typeable Haemophilus influenzae (NTHi) represents a large burden on healthcare systems around the world. Meningitis, bacteraemia, community-acquired pneumonia (CAP), and acute otitis media (AOM) are vaccine-preventable infectious diseases that can have severe consequences. The health economic model presented here is intended to estimate the clinical and economic impact of vaccinating birth cohorts in Canada and the UK with the 10-valent, pneumococcal non-typeable Haemophilus influenzae protein D conjugate vaccine (PHiD-CV) compared with the newly licensed 13-valent pneumococcal conjugate vaccine (PCV-13).

Methods:

The model described herein is a Markov cohort model built to simulate the epidemiological burden of pneumococcal- and NTHi-related diseases within birth cohorts in the UK and Canada. Base-case assumptions include estimates of vaccine efficacy and NTHi infection rates that are based on published literature.

Results:

The model predicts that the two vaccines will provide a broadly similar impact on all-cause invasive disease and CAP under base-case assumptions. However, PHiD-CV is expected to provide a substantially greater reduction in AOM compared with PCV-13, offering additional savings of Canadian $9.0 million and £4.9 million in discounted direct medical costs in Canada and the UK, respectively.

Limitations:

The main limitations of the study are the difficulties in modelling indirect vaccine effects (herd effect and serotype replacement), the absence of PHiD-CV- and PCV-13-specific efficacy data and a lack of comprehensive NTHi surveillance data. Additional limitations relate to the fact that the transmission dynamics of pneumococcal serotypes have not been modelled, nor has antibiotic resistance been accounted for in this paper.

Conclusion:

This cost-effectiveness analysis suggests that, in Canada and the UK, PHiD-CV’s potential to protect against NTHi infections could provide a greater impact on overall disease burden than the additional serotypes contained in PCV-13.