On the Cost of Adverse Selection in Individual Annuity Markets: Evidence From Singapore

New evidence is presented on the cost of adverse selection in individual annuity markets using Singapore data. The Singapore annuity market is an interesting setting to examine the cost of adverse selection for three reasons. First, unlike many Western countries, the Singapore government provides very limited public financial assistance for retirees. Second, while social security contributions mandated under the Central Provident Fund (CPF) result in a high forced savings rate, a large proportion of CPF savings, are used up for housing. Third, to ensure that retirees have sufficient funds to meet basic needs, individuals who reach age 55 are required to set aside a minimum amount of their CPF savings, which can be withdrawn at age 62. The CPF Board allows various options for investing the minimum sum, but the most attractive option is to purchase an annuity. The institutional setting in Singapore in effect provides insurers with a large captive market for annuities. It is conjectured that this should be reflected in a significantly lower cost of adverse selection for annuities sold in Singapore as compared with other countries. The results herein, using data for CPF‐approved insurers, are strongly consistent with this conjecture. On average, money's worth of annuities is higher than annuities sold to a similar age‐gender mix in the United States, United Kingdom, and Australia. Adverse selection accounts for less than 13 percent of the cost of longevity insurance compared to 30–50 per‐ cent documented in many previous studies. These results suggest that one way to resolve the adverse selection problem is to adopt a universal individual defined contribution pension scheme that mandates or provides strong incentives for retirees to purchase annuities.     

Public or private gatekeepers in non-consensual debt restructurings in emerging jurisdictions

In advanced jurisdictions, the choice of a non-consensual debt restructuring is between a public or a private gatekeeper model where either the court or the licensed insolvency professional respectively approves a restructuring plan that binds dissenting creditors. In the United States, the only gateway is found in Chapter 11 of the Bankruptcy Code 1978, which requires court approval and gives the debtor a significant say in the outcome. In contrast, in the United Kingdom, there exist four gateways, only two of which require court approval (scheme of arrangement and restructuring plan), while the remaining two (administration and company voluntary arrangement) give significant powers to the insolvency practitioner to decide on the outcome. In emerging jurisdictions such as Mainland China and India, due to path dependency and lack of institutional capacity, the court-supervised model is chosen as the only or primary gateway to legitimise non-consensual restructurings though the insolvency practitioner has an important statutory role. Using the two jurisdictions as case studies, this article argues that such a choice has several initial benefits but also leads to several problems, including delays in the restructuring, does not necessarily improve substantive outcomes and does not adequately address the shareholder–creditor and creditor–creditor agency costs. This article proposes that for debt restructuring that involves the sale of the business as a going concern, the private gatekeeper should be able to decide on the sale and the distributions following pre-bankruptcy entitlements. Recourse to the court as a public gatekeeper should only be used for reorganisation proceedings.     

Long-term health-related burden of adult congenital heart diseases in Hong Kong

Aims: This study aimed to examine the long-term clinical and economic burden of adults with congenital heart disease (ACHD) in Hong Kong.

Methods: It retrospectively analyzed 336 consecutive ACHD patients who attended the Adult Congenital Heart Clinic between January 1, 2009 and December 31, 2014. Direct medical costs and clinical outcomes over the 5 years were calculated and documented. The economic evaluation was from the hospital’s perspective.

Results: The median age of ACHD patients was 47 (31–62) years old, with female predominance (61.5%). Ventricular and atrial septal defects accounted for 70% and severe ACHD for 10% of the study cohort. The prevalence of arrhythmia and heart failure increased with the complexity of CHD. The total mean annual cost for managing each ACHD patient was USD 2,913. The annual cost of management of simple ACHD was USD 2,638 vs complex ACHD (USD 6,425) (p?=?0.013).

Conclusions: This study demonstrated severe ACHD patients accounted for higher cardiovascular morbidities in arrhythmias and heart failure with a higher cost of management.     

Information Flows Between the U.S. and China Commodity Futures Trading

Using a bivariate GARCH model, we examine patterns of information flows for three commodity futures traded in both the developed U.S. market and the emerging China market (copper, soybeans and wheat). For copper and soybeans, the two commodities that are subject to less government regulation and fewer import restrictions in China, we find that the U.S. futures market plays a dominant role in transmitting information to the Chinese market, a result that confirms the importance of the U.S. role as a leader in the global financial market. For the heavily regulated and subsidized wheat commodity, our empirical results indicate that the U.S.-China futures markets are highly segmented in pricing, although information transmission via volatility spillover across markets is present.     

The impact of sovereign risk on bond duration: Evidence from Asian sovereign bond markets

This paper examines the effect of sovereign risk on bond duration. We compare the sovereign risk-adjusted duration for U.S. dollar-denominated Asian sovereign bonds with their Macaulay duration for both investment grade bonds and speculative grade bonds. We find that the sovereign risk-adjusted duration is significantly shorter than its Macaulay counterpart for all bonds, regardless of their bond rating and their maturity. Further, the “shortening” effect of sovereign risk on duration gets stronger as bond rating deteriorates and in recessionary conditions. Our findings provide strong support for the importance of adjusting for sovereign risk when bond portfolio managers apply the popular duration measure to hedge interest rate risk.     

一种用于雷达可编程信号处理机的通用开发系统

本文介绍一种由微机、逻辑分析仪和一块通用接口电路板组成的简易通用数字开发系统(SVDDS),在不增加任何新的专用设备条件下,能有效地调试和开发多功能雷达可编程数字信号处理机(PDSP)的功能模板及其PDSP系统.同时,还能测试各种LSI、VLSI的静、动态特性.经实用表明,SVDDS具有开发任何数字系统(硬件和软件)的能力,而且实用性广,通用性强,经济效益极高.     

Civic Engagement in the Performance Evaluation of the Public Sector in China: Building horizontal accountability to enhance vertical accountability

Abstract

This article accounts for the logic of building of an accountability mechanism with elements of civic engagement in an authoritarian regime. It is elaborated by a performance evaluation programme ‘Democratic Review of Administrative and Business Style’ (DRABS) in Wuhan in central China. The author argues that the DRABS does help form government agencies’ responsiveness to the public with various public scrutiny instruments including mass media and the internet, and that it is more accurate to frame the mechanism as having the function of building horizontal accountability to enhance vertical accountability.     

中部崛起中的六省旅游联动发展

中部崛起关系我国经济发展的全局,具有重要战略意义.借鉴长三角地区成功发展的启示,中部地区要实现崛起必须在发挥六省各自优势的同时,充分进行区域协作,实行区域联动.在目前六省竞争有余、协作不足的情况下,有必要利用旅游资源丰富、互补性强,旅游产业发展态势良好的有利条件,充分发挥旅游业关联带动作用明显、区域协作性强的产业特质,以旅游业为联动的首选行业,进行协作,实现旅游资源、客源市场共享,域内各级政府与旅游企业间的联动.并以此为范例,带动其他产业的协作与联动,开创六省上下一条心、紧抓机遇共谋崛起的良好局面.     

INDUSTRIAL AND AGGREGATE MEASURES OF PRODUCTIVITY GROWTH IN CHINA, 1982–2000

We estimate productivity growth for 33 industries covering the entire Chinese economy using a time series of input–output tables covering 1982–2000. Capital input is measured using detailed investment data by asset and labor input uses demographic information from household surveys. We find a wide range of productivity performance at the industry level. We then show how these industry growth accounts may be consistently aggregated to deliver a decomposition of aggregate GDP growth. For the 1982–2000 period aggregate TFP growth was 2.5 percent per year; decelerating from a rapid rate in the early 1980s to negative growth during 1994–2000. The main source of growth during the 1982–2000 period was capital accumulation, with a small negative contribution from the reallocation of factors across industries.