The influence of government ideology on monetary policy: New cross‐country evidence based on dynamic heterogeneous panels

Using data of 23 OECD countries over the 1980–2005 period, we examine whether government ideology affects monetary policy, conditional on central bank independence. Unlike previous studies in this line of literature, we estimate central bank behavior using forward‐looking and real‐time data in Taylor rule models and use estimators that allow for heterogeneity across countries. Our models with heterogeneous slope coefficients for the full sample do not suggest partisan effects. We also do not find evidence that central bank behavior is conditioned by the interaction of the ideology of the incumbent government and the electoral calendar.     

Sudden Stops and Currency Crashes

This paper investigates which factors determine whether sudden stops in international capital flows are followed by a currency crash using data for 85 economies in the period 1980–2012. An event study approach is used for an 11‐year window around the crises for nine potential explanatory variables. In addition, the paper estimates discrete‐choice panel models. The results suggest that low trade openness, shallow financial markets, and current account imbalances increase the likelihood that a sudden stop will be followed by a currency crash. Moreover, it is established that the impact of these factors differs across different exchange rate regimes.     

Confidence sets in nonparametric calibration of exponential Lévy models

Confidence intervals and joint confidence sets are constructed for the nonparametric calibration of exponential Lévy models based on prices of European options. To this end, we show joint asymptotic normality in the spectral calibration method for the estimators of the volatility, the drift, the jump intensity and the Lévy density at finitely many points.     

CORPORATE GOVERNANCE OF BANKS: A SURVEY

This paper reviews the empirical literature on the corporate governance of banks. We start by highlighting the main differences between banks and nonfinancial firms and focus on three characteristics that make banks special: (i) regulation, (ii) the capital structure of banks, and (iii) the complexity and opacity of their business and structure. Next, we discuss the characteristics of corporate governance in banks and how they differ from the governance of nonfinancial firms. We then review the evidence on three governance mechanisms: (i) boards, (ii) ownership structures, and (iii) executive compensation. Our review suggests that some of the empirical regularities found in the literature on corporate governance of nonfinancial institutions, such as the positive (negative) association between board independence (size) and performance, do not hold for banks. Also, existing work provides no conclusive results regarding the relationship between different governance mechanisms and various measures for banks’ performance. We discuss potential explanations for these mixed results.     

Global mobility orientation and the success of self-initiated expatriates in Greater China

We investigated 640 self-initiated expatriate academics residing in Greater China. We examined whether their inherent demographic characteristics (age/gender) and acquired demographic characteristics (marital status/seniority) differentiated their work outcomes regarding job adjustment, time to proficiency, performance and satisfaction. We also explored the associations between global mobility orientation and these four work outcomes and examined to what extent the demographic characteristics differentiated the relationships. Results support most hypothesized differences. We found that a global mobility orientation was associated with all the work outcomes, except satisfaction. For inherent demographic characteristics, we found support for our hypotheses that for individuals with less successful demographics (younger, male), there was a stronger relationship between global mobility orientation and the work outcomes.     

Designing Public Services: The usefulness of three service design methods for identifying user experiences

This article examines the use of three service design methods in exploring complex public service systems. The methods used were the persona technique, mapping techniques in collaborative design workshops, and observations supplemented by group discussions. In their application to a university service, it was found that through their user-centred and collaborative approach, the service design methods assisted in the analysis of user experiences, including critical incidents, within the service system. It was also identified that user co-production formed the core of the service system and its processes, which highlights the need to actively involve users in public service design projects.     

INFLATION AND CENTRAL BANK INDEPENDENCE: A META‐REGRESSION ANALYSIS

Abstract Using 59 studies, we perform a meta‐regression analysis of studies examining the relationship between inflation and central bank independence (CBI). The studies considered are very different with respect to the CBI indicator used, the sample of countries and time periods covered, model specification, estimators used and publication outlet. We conclude that there is a significant publication bias. However, we also find a significant genuine effect of CBI on inflation. Differences between studies are not caused by differences in CBI indicators used.     

Outsourcing to a non-developed supplier market: The importance of operational aspects in outsourcing

This article investigates how firms manage outsourcing in situations of a non-developed supplier market. This study followed the initial outsourcing activities and strategies of two case companies in the wood product manufacturing industry. The findings show that greater focus needs to be placed on operational aspects associated with non-developed supplier markets, which contrasts with the traditional strategic view of outsourcing. For practitioners, this article suggests that it is important to emphasise that the learning curve for a supplier can be lengthy, and also that alternative outsourcing routes are available when outsourcing to a non-developed supplier market.     

Monetary targeting in the Netherlands: an application of co-integration tests

There are two criteria to choose an intermediate variable for monetary targeting. First, the money demand function needs to be stable and second, the monetary authorities should be able to control the target variable given the available instruments. In this paper we examine whether M1 and M2 in the Netherlands fulfil the first requirement, i.e. we investigate whether a stable relationship exists between these monetary variables and key macroeconomic variables. Co-integration techniques are used which are very well suited for this purpose. Monetary policy in the Netherlands has been directed towards the growth rate of broad money (M2). The present findings do not suport the choice of M2 as an intermediate target for monetary policy in the Netherlands. A stable long-term relationship between M2 and real NNP and Long-and short-term interest rates does not exist. The results for M1 are considerbly better, though not favourable at all scores. The estimated moeny demand function for M1 is a good indicator for monetary policy, since the Dutch central bank probably cannot control the growth rate of M1.     

Integrated Information Supply for Decision Support in Grid Companies

Increasing regulatory requirements such as price cap regulation have increased the importance of strategic grid asset management. Empirical studies reveal that information supply and consolidation are error prone and long-term processes. The reason is the missing automation of extraction, transformation, and loading. The current gap does neither fulfill the requirements of regulatory nor the necessity of standardized reporting. Furthermore, a detailed planning is not enabled and the calculation of key figures is extensive. Currently, a framework that considers the coupling of financial and technical key figures, the coupling of strategic and operative key figures as well as the integration into information systems is not existent. Therefore, this paper addresses the design of a reference model as a recommendation for action to integrate the asset management within information systems. It is validated by expert interviews. Moreover, it provides information to integrate relevant financial and technical artifacts from distributed systems. Simultaneously, it provides recommendations for implementing a Business Intelligence architecture in the context of strategic decision support.