Factors Determining Net Interest Margins in Australia: Domestic and Foreign Banks

This study tests the application of the Ho and Saunders (1981) model of bank net interest margins (NIMs), and its subsequent developments, using Australian data. The core elements of this model apply in Australia. Bank market power is found to increase NIMs, consistent with McShane and Sharpe (1985) , with evidence of bank buying market share and mispricing for risk. Operating costs also have an important role in determining NIMs, together with implied payments and management quality. Bank NIMs are found to have fallen over the study period.     

A Simple Duality Model of Production Incorporatin Risk Aversion and Price Uncertainty

Proceeding within the framework of a linear mean-variance utility function, this paper outlines a duality model of production that incorporates risk aversion and price uncertainty. In contrast to risk models based on an expected utility function, this model provides a practical alternative to standard duality models for econometric research.     

The political economy of participation in IMF programs: a disaggregated empirical analysis

What factors determine whether or not countries have programs with the International Monetary Fund (IMF)? The existing literature suggests that a number of economic and political variables are important, but there is disagreement about their relative significance. Moreover, the fit of general participation models is not particularly good. An increasingly popular view in the recent literature is that the pattern of IMF lending is politically driven and that it reflects the interests of the Fund’s leading shareholders; the US is seen as exerting a powerful influence. Using both quantitative and qualitative techniques, and based on an informal analytical framework, we examine in detail the factors that may be at work. We cover the period from 1984 to 2008. We discover considerable variation across the nature of programs (concessional and non-concessional), income levels, geographic regions, and time periods. The degree of observed variation means that it is unsafe to use one general participation model as the basis for evaluating the effects of IMF programs. It also means that the design of policy needs to reflect the nuances that the data reveal.     

Is UK Vice Chancellor Pay Justified by University Performance?

The pay of university managers (vice chancellors, VCs) in the UK has risen sharply in recent years. This paper considers the extent to which VC pay awards are related to university performance measures based around institution mission and financial probity using an individual fixed effects strategy based on data covering academic years 1998–99 to 2008–09. In contrast to earlier studies on this theme, we find evidence that VCs are rewarded for observable mission‐based performance measures. Specifically, our results suggest that success in widening participation for students from comprehensive schools and those from areas with low university participation exerts a positive effect on VCs' pay. Securing income flows from university funding council grants also impacts positively on their remuneration. However, even after controlling for a rich array of observable and unobservable factors, there have been sizeable increases in real pay in recent years that cannot be readily explained.     

Inducements,Impediments, and Immediacy: Exploring the Cognitive Drivers of Small Business Managers' Intentions to Adopt Business Model Change

Small business managers rely on judgment and heuristics when making critical strategic decisions. We explore this phenomenon, expanding the theory on cognition and strategy to explain the cognitive determinants of strategic decisions leading to small firm business model change. We integrate existing theories (entrepreneurial opportunity exploitation, cognitive resilience, prospect theory, behavioral theory of the firm, threat‐rigidity) into a framework explaining strategic intentions, based on managers' perception of business opportunity interacting with assessment of the external environment, current performance, and prior experience. The framework is empirically tested in the context of Canadian real estate brokerage industry, facing potentially major disruptive change.