The relative influence of price and non-price factors on short-term retail deposit quantities?

This study explores how price and non-price factors influence change in the quantity of short-term retail deposits held by depository institutions. The analysis is undertaken for a sample of UK building societies over 23 years using a disaggregated data set with a two-stage econometric procedure involving system estimators in a panel framework using seemingly unrelated regression, generalised method of moments and an ordinary least-squares fixed effects estimators to control for contemporaneous correlation and endogeneity concerns. Price factors examined include the policy or base rate and retail deposit interest rates set by individual building societies and non-price factors including the branch network and the number of deposit accounts offered by individual building societies. The cost of funds, one non-price factor and occurrence of mergers are consistently significant influences of retail deposit quantities. We conclude risk assessment of retail deposit quantity and monetary policy transmission would benefit from considering both price and non-price factors, rather than only price factors.     

Aktuelle Rechtsfragen der Umweltschadensversicherung

The paper provides an overview of current legal issues with regard to the environmental damage insurance, which exists in Germany since 2007. At the center of the observation are limitations of coverage, in particular the requirement of a malfunction of the business operations, the exclusion of qualitative risk changes and the cost deduction clause. In addition, the article deals with some issues of interpretation as well as of delimitation with regard to further insurance policies. By way of introduction the basics of the German Environmental Damage Act (USchadG) and its underlying EU Directive are shown. Finally, the authors discuss the question whether the environmental damage insurance should be configured as an obligatory insurance in the future.     

Information Inertia

We show that aversion to risk and ambiguity leads to information inertia when investors process public news about assets. Optimal portfolios do not always depend on news that is worse than expected; hence, the equilibrium stock price does not reflect this bad news. This informational inefficiency is more severe when there is more risk and ambiguity but disappears when investors are risk‐neutral or the news is about idiosyncratic risk. Information inertia leads to news momentum (e.g., after earnings announcements) and is consistent with low household trading activity. An ambiguity premium helps explain the macro and earnings announcement premium.     

Trust in financial services: Retrospect and prospect

Fostering and maintaining high levels of trust in the financial services sector is seen as crucial because of the characteristics of many financial service and in order to promote consumer engagement in the sector. In this article, we report evidence from a body of work and other commentary to provide an insight into trends in consumer trust in the sector as a whole, in comparison with other organisations and how different types of financial services provider have performed relative to each other. We show that the financial services sector as a whole is trusted more than some comparator institutions, and that aggregate levels of trust in the sector have fluctuated a relatively small amount subsequent to the financial crisis. However, important differences between provider types are apparent and these differences have become more profound in the recent past. We provide suggestions as to how trust in the sector may be improved and provider an analysis of current initiatives to improve trust levels in the sector in general and in banking in particular.     

A tool for analysing the interdependence of indoor environmental quality and reported symptoms of the hospitals’ personnel

The working environment and the working conditions can influence the well-being of hospital employees and consequently their performance at work. The present questionnaire-based study (737 valid questionnaires) developed and evaluated a quantitative structural equation model (SEM) that examines the interdependence between the indoor environmental quality (IEQ), the working conditions, the atopic constituents and the reported health complains of employees in three Greek hospitals. The results of the SEM reveal that IEQ could partially explain the employees’ symptoms in the hospitals. The working conditions proved to be a key factor in the relationship between IEQ and symptoms. Multi-group analysis has shown that this interdependence is affected by the building characteristics, by the gender, the smoking habits and the specialty of each participant, but not by their age.     

Does Corporate Transparency Contribute to Efficient Resource Allocation?

This paper examines whether a country's corporate transparency environment, which includes the quality of accounting information, contributes to efficient resource allocation. Based on a cross-country study of 37 manufacturing industries in 37 countries, we provide three pieces of related evidence. First, we find the contemporaneous correlations in industry growth rates across country pairs are higher when there is a greater level of corporate transparency in the country pairs, after controlling for country-level economic and financial development. Second, we find the influence of transparency on these correlations is stronger when country pairs are at similar levels of economic development (GDP). Finally, when we control for the level of transparency explained by a country's institutions in place, we find that residual transparency (unexplained by country-level factors) is associated with industry-specific growth rates. Taken together, the results are consistent with corporate transparency facilitating the allocation of resources across industry sectors.     

Bonds versus stocks: Investors’ age and risk taking

It has become increasingly popular to advise investors to relocate their funds from a primarily stock portfolio to a primarily bond portfolio as they get older. However, the well-known decision rules such as mean–variance or stochastic dominance rules are unable to explain this common practice. Almost stochastic dominance (ASD) and almost mean–variance (AMV) approaches are used to examine the dominance of stock and bond portfolios. ASD and AMV rules unambiguously support the popular practice of advising higher stock to bond ratio for long investment horizons. Hence, we provide an explanation to the practitioners’ recommendation within the expected utility paradigm.     

Tariff protection and workforce gender: Evidence from U.S. manufacturing industries

A data set of 266 four-digit SIC U.S. manufacturing industries is used to examine the relationship between tariff protection and workforce gender. The paper shows that industries with a relatively large proportion of women are more likely to be protected by U.S. tariff policy, even when factors such as wages and human capital are controlled. Furthermore, this result is robust in that it is not driven by any particular industry or industries.     

Business cycle transmission and interdependence between Japan and Australia

This paper investigates business cycle transmission and interdependence between Australia and Japan over the period 1961.1–1994.4. Vector autoregression (VAR) and vector error correction (VEC) models were constructed utilizing GDP/GNPs, producer prices, interest rates and money supplies. The model is tested for cointegration. Two cointegrating vectors are found, and a vector error correction (VEC) model is estimated. The coefficients and the F-tests of the VEC are used to measure the effect of one economy upon the other. Impulse responses from a VAR are examined for evidence of business cycle transmission, and recursive least squares estimates are used to check for structural change in the relationship. Figures are used to graphically demonstrate these relationships and have been collected in an appendix, which can be found at the end of the text.While the two countries engage in a close trading relationship, the two economies are found to be only somewhat interdependent in macroeconometric terms. Japan is found to transmit some of its business cycle fluctuations to Australia, but there is little reverse transmission.