Macroprudential policy and the inward transmission of monetary policy: The case of Chile,Mexico, and Russia

This paper studies whether domestic macroprudential policy may attenuate the inward transmission of monetary policy shocks from the United States to domestic bank lending growth in three emerging market economies—Chile, Mexico, and Russia. Identification relies on banks’ heterogeneous exposure to prudential policies and the fact that foreign monetary policy shocks are exogenous from the perspective of these economies. After analyzing the effects of the aggregate domestic prudential policy stance, we focus on specific prudential policies targeting mortgage and consumer loans, as well as foreign‐currency deposits. Although our overall results are mixed, we find evidence that the strength of international monetary policy spillovers varies depending on the stance of domestic macroprudential policy. In particular, a tighter reserve requirement stance over foreign‐currency deposits in Chile dampens the effect of an international monetary policy shock on domestic local‐currency lending, but reinforces that on foreign‐currency lending, whereas in Russia, it dampens the effect on both local‐currency and foreign‐currency lending, although to different degrees. Prudential policies targeting the asset side of banks’ balance sheets, such as mortgage loans or consumer credit, are found to amplify international monetary policy spillovers in some cases and attenuate it in others, depending on the country context.     

Non-elective C-sections in public hospitals: capacity constraints and doctor incentives

Using administrative records of births from the Perinatal Surveillance System of the Peruvian Social Security System (ESSALUD), we test whether high admissions of pregnant women affected non-elective caesarean section (C-section) rates in the ESSALUD public hospitals during 2005–2006. We present a basic theoretical model that considers physician preferences for leisure and hospital capacity constraints, and test the model predictions. We find that physician demand for leisure increases the probability of C-sections in small and medium-size hospitals, while hospital capacity constraints set a limit on them. We discuss the policy implications as well as the policies implemented to avoid unnecessary C-sections.     

Economic and environmental efficiency using a social accounting matrix

This paper aims to show the utility of the so-called Social Accounting Matrix and Environmental Accounts (SAMEA) for economic and environmental efficiency analysis. The article uses the SAMEA for Spain in 2000, applied to water resources and greenhouse gas emissions. This matrix is used as a central core of a multisectorial model of economic and environmental performance, and it calculates the denominated “domestics SAMEA multipliers” and their decomposition into characteristic, direct, indirect and induced effects. These multipliers show some evaluation of economic and environmental efficiency. Also, we present an application of these multipliers that demonstrates that there is no causal interrelation between those sectors with higher economic backward linkages and those with higher environmental deterioration backward linkages.     

Vulnerable groups in recessionary situations: The case of children and the young in Chile

This study analyses the impact which recessionary conditions have had in Chile on a particularly vulnerable age group: children and the young. In addition to the external crisis, Chile experienced serious imbalances in the form of inflation and balance-of-payments deficits in the early 1970s. Social development experts have long recommended the application of selective policies to ‘target groups’ whose situation is especially vulnerable to economic fluctuations. During the early 1970s, Chile implemented policies specifically designed to improve the situation of children, especially in terms of mother and child care, and programmes were undertaken to combat infant undernutrition. This paper evaluates the success of these programmes in counteracting the negative effects of the recession and the recessionary adjustment policies.     

Foreign Direct Investment in Mexico since the Approval of NAFTA

Cross-country panel data are used to assess the effect of free-tradeagreements on flows of foreign direct investment (FDI). Free-tradeagreements are found to have a significant positive effect onFDI flows, and free-trade agreements are found to matter morefor the smaller members of the agreement. For example, the NorthAmerican Free-Trade Agreement’s (NAFTA) effect on FDIflows into Mexico is much larger than its effect on flows intothe United States. These cross-country results are used to assessNAFTA’s effect on FDI flows into Mexico. After controllingfor a set of other factors—such as an increase in worldwideFDI flows—the trade agreement is found to generate FDIflows nearly 60 percent higher than they would have been withoutthe agreement.     

Impact of introducing eco-innovation measures on productivity in transport sector companies

This paper analyses the impact of factors related to innovation and the environment, among others, on labour productivity in the Spanish transport sector. The methodological approach used in this study was based on the CDM structural model. The main advantage of this model is its capacity to integrate investment in R&D and the generation of knowledge and production innovation. The data used in the estimations were obtained from the Technological Innovation Panel (PITEC) database. PITEC is a panel-type database jointly prepared by the Spanish National Institute of Statistics (INE) and the Spanish Foundation for Science and Technology (FECYT). The econometric results show that reducing the environmental impact has a statistically significant and positive effect at all stages of the innovative process and above all on labour productivity of transport firms, where the improvement of labour productivity can reach 8.35% compared to non-ecoinnovative companies. This finding could alert firms in the transport sector to the need to improve their activities by adopting environmentally proactive attitudes.     

Concentration and foreign penetration in Latin American banking sectors: Impact on competition and risk

In the 1990s, Latin American banking sectors experienced an accelerated process of concentration and foreign penetration that prompted diverse views regarding its implications for the competitive behavior of banks and the financial stability of the system. In this paper, we examine these issues exploiting a rich bank-level database for eight Latin American countries. We find that, while increased concentration did not weaken banking competition within the region, foreign penetration appears to have led to a less competitive industry. Moreover, we find that bank risk has been negatively associated with competition which, coupled with the previous finding, explains the positive link between banking sector stability and foreign penetration revealed by the data.     

Legal form and risk exposure in Spanish firms

Abstract. It is well-known that the legal form adopted by a firm determines the type of legal responsibility borne by its owners in case of bankruptcy. In this paper we argue that a firm under a limited liability status should be characterized by a higher than average bankruptcy probability, which ultimately captures their risk exposure when output is affected by exogenous shocks. To test this prediction we extend Lee's (1976) switching regressions model to a panel dataset of 1313 Spanish firms from 1990–1994, separating them into corporate and entrepreneurial forms (with/without limited liability, respectively). We consider both random effects and fixed effects panel data models, taking into account the potential endogeneity between risk exposure and the legal form choice. Our results confirm the hypothesis that firms under limited liability have significant higher risk exposure than firms under unlimited liability. The authors gratefully acknowledge valuable suggestions from Maite Martínez-Granado, A. Jorge Padilla, Javier Suárez and two anonymous referees. Data and financial support provided by the Fundación Empresa Pública (Madrid) and comments from participants at seminars held at CEMFI, Simposio de Análisis Económico and Universidad de Vigo are also sincerely appreciated. Mr. Campos particularly acknowledges research funding by the University of Las Palmas.