National culture and (dis)trust in banks: Cross-country evidence

We examine to what extent a specific aspect of national culture—uncertainty avoidance—can explain cross-country variations in (dis)trust in banks. Relying on data from the World Values Survey, we find that trust in banks is lower in countries that score high for Hofstede's uncertainty avoidance index. Similarly, with Global Findex data, we find that financial exclusion due to a lack of trust in banks is high in high uncertainty avoidance cultures. These results highlight the need for a more culturally aware approach when designing consumer protection measures for the banking sector.     

Using high, low, open, and closing prices to estimate the effects of cash settlement on futures prices

Due to dwindling commercial interest in the feeder cattle futures contract, the Chicago Mercantile Exchange (CME) decided to replace the contract's physical delivery provision with a cash settlement provision, arguing that cash settlement would help reduce price volatility and attracts more commercial interests. In this article, we apply stochastic volatility models to investigate the CME conjecture, using four different estimators based on opening, high, low, and closing prices, respectively. With each estimator, we find that the volatility of the feeder cattle futures price decreases after the implementation of cash settlement. We conclude that the change in the contract specification enhances price discovery and the contract's hedging performance.     

Normalized Intensity: The New Labour Process of Middle Management

abstract    Based on qualitative interviews (n = 64) within five UK organizations that have embarked on large-scale restructuring (including delayering, downsizing, culture change, role redesign, lean production) we argue that middle managers are currently experiencing significant and progressive work and personal pressures. Performance is monitored more closely, hours and intensity of work are increasing, roles and tasks are changing frequently, and prospects for promotion are downscaled within flattened hierarchies. Whereas middle managers report increased levels of autonomy and skill, are often well remunerated, and frequently appear motivated (at least in the private sector), we suggest their burgeoning grievances over working hours, role pressures and promotion prospects have worrying implications for the future performance of UK industry. We argue further that the motivation for corporations to embark on such large-scale restructuring is best understood with reference to the incessant demands of international capitalism. We conclude that such restructuring, and the personal managerial experiences that result from it, is in keeping with many, but crucially not all, of the trends predicted by Bravermanian labour process theory.     

Affirmative action as a form of restitution

Though the common sense defense of affirmative action (or employment equity) appeals to principles of restitution, philosophers have tried to defend it in other ways. In contrast, I defend it by appealing to the notion of restitution, arguing (1) that alternative attempts to justify affirmative action fail; and (2) that ordinary affirmative action programs need to be supplemented and amended in keeping with the principles this suggests. Leo Groarke is associate professor of philosophy at Wilfrid Laurier University. His work has appeared in a number of scholarly journals, including Dialogue, Atlantis, The Public Affairs Quarterly, Teaching Philosophy and The Journal of the History of Philosophy. His books include Nuclear War: Philosophical Perspectives (1985) and Greek Scepticism (forthcoming from McGill-Queen's University Press).     

Multinational firms, market integration, and trade structure: What remains of the standard-goods hypothesis?

Multinational Firms, Market Integration, and Trade Structure: What Remains of the Standard-Goods Hypothesis? — In extending traditional empirical trade models to multinational firms, this paper shows the effect of the transfer of firm-specific technology and intangible assets by these firms on the structure of host countries. For Belgium, a small open economy with a large presence of foreign multinationals, this effect is of crucial importance and previous studies appeared to have produced biased results by neglecting it. The econometric results show how the large multinational presence induced by the European integration has shifted Belgium’s trade structure towards differentiated products, thereby challenging the standard-goods hypothesis which states that small countries tend to specialize in nondifferentiated products. Spain and Ireland have witnessed an increase in foreign direct investment and a shift in trade structure similar to Belgium after joining the EC.     

Modelling systemic price cojumps with Hawkes factor models

Instabilities in the price dynamics of a large number of financial assets are a clear sign of systemic events. By investigating portfolios of highly liquid stocks, we find that there are a large number of high-frequency cojumps. We show that the dynamics of these jumps is described neither by a multivariate Poisson nor by a multivariate Hawkes model. We introduce a Hawkes one-factor model which is able to capture simultaneously the time clustering of jumps and the high synchronization of jumps across assets.     

Planning and Uncovering Industrial Symbiosis: Comparing the Rotterdam and Östergötland regions

Industrial ecology is defined as the study of material and energy flows through industrial systems and as such may focus on a geographic area, resource and/or industry sector. In these types of setting, industrial ecology is also often known as industrial symbiosis (IS). The proximity of companies in industrial estates facilitates the linking of utilities and the exchange of wastes and by‐products, which may eventually be useful inputs for adjacent industrial processes. The typical model that has been applied in several regions of the world is one where an anchor‐tenant organization with energy and by‐product linkages is connected to companies physically located nearby. In the case of biomass symbiosis, however, the resource chains are not explicitly arranged by their industrial setting and the supply of waste and by‐products is able to be organized in a more scattered way. In this article, the role of industrial symbiosis is analyzed in respect of the planned industrial symbiosis activities in the Rotterdam Harbour and Industry Complex in the Netherlands and in the application of renewable energy in the Östergötland region in Sweden. The objective of this article is to discuss the similarities and differences between the planned industrial symbiosis activities in Rotterdam and the unplanned biomass and industrial symbiosis activities in the Östergötland region. By presenting this knowledge in this article, it is anticipated that further development of industrial symbiosis application processes may be achieved. Copyright © 2011 John Wiley & Sons, Ltd and ERP Environment.     

Optimal taxation with joint production of agriculture and rural amenities

We show that, when there is joint production of an agricultural good and rural amenities, the first-best allocation of resources can be implemented with a tax on the agricultural good and some subsidies on the production factors (land and labor). The use of a subsidy on the agricultural good can only be explained by the desire of the policymaker to redistribute income from the consumers to the farmers.     

Bank-Specific Daily Interest Rate Adjustment in the Dutch Mortgage Market

This paper presents an empirical analysis of the interest rate setting behavior of the four largest banks in the Dutch mortgage market, using advertised interest rates at a daily frequency. The evidence for the long run pricing behaviour suggests that the banks operate in a competitive environment as they base their interest rates on funding cost. However, two banks appear to be less cost sensitive than the others. In the short run, most of the banks adjust their rates less strongly to funding cost increases than to decreases, which suggests competitive pressures. For one bank significant evidence is found for a quicker response to negative than to positive deviations of actual from desired interest rates.