The Impact of Deregulation during 1990–1997 on Banking in Austria

The operating environment for banking in Austriachanged substantially during 1990–1997. The changes during the periodcan be seen as a gradualadjustment towards adherence to European banking standards, which becamea legal requirement on Austria's entry, in 1995, into the European Union. Inthis paper, we investigate the relative performance of Austrian banksduring this period and thereby test the hypothesis of increasedcompetition. The study reveals that Aktiengesellschaften hadconsistent productivity improvement over the period, Sparkassen,and Volksbanken exhibited a turnaround in productivity in 1997,and Raiffeisenbanken experienced consistent productivity decline.Overall, Austrian banks experienced a decline in average efficiencyand productivity until 1996 with slight improvements in 1997. Thestudy reveals evidence of product diversification rather thanincreased price competition; a decrease in the spread of prices paidfor inputs indicates increased competitiveness over the period, whichcan be attributed to deregulation brought about by EU-membership.     

Global imbalances and asymmetric returns to US foreign assets: fitting the missing pieces of the US balance of payments puzzle

The issue of whether the US earns a persistently higher return on its foreign direct investment (relative to returns to foreign-owned direct investment in the US) has received considerable attention but little closure in the ‘global imbalances’ debate. Measuring the rate of returns to US direct investment abroad and foreign direct investment in the US we find higher returns to US foreign direct investment relative to its foreign counterparts in the US. Given the evidence indicating higher returns to US direct investment overseas, we link the irresolution in the contemporary literature regarding the existence of these returns to the unsettled debate over the origin of global imbalances. Reviewing the macro-financial literature on global imbalances, we find a failure to acknowledge that the US current account deficit is, in part, the outcome of transnational production networks in a global economy under-pinned by dollar hegemony. Given the growth in US multinational supply chains, we argue that the US trade deficit is consistent with asymmetric returns to US direct investment and that the sustainability of these return differentials rests on the stability of the status quo.     

The interplay of external punishment and internal rewards: An exploratory study of insurance fraud

Economic theories related to ethical consumer behaviour have for the most part examined the role of external incentives and deterrents, and relatively less focus has been given to the role of internal incentives. This study explores the independent and joint effects of internal rewards and external punishment mechanisms on the likelihood of consumers exhibiting unethical behaviour in insurance fraud (IF) contexts. By utilizing a data set consisting of survey data on over 43?000 consumers across 26 European countries, this study examines the interaction of internal moral values and external deterrents, affecting unethical consumer behaviour. Ordinal regression analysis and binary logistic regression were used to assess the role of internal rewards and external punishment mechanisms in the occurrence of IF. Attitudinal differences towards IF and perceptions of the probability of being caught were used to classify customers and to predict the incidence of IF. Demographic variables were also found to be correlated with IF. Perceptions of ineffectiveness of fraud investigation and detection systems by fraudulent customers significantly influences their likelihood to commit IF.     

Insider Trading and Financing Constraints

Insider trading may alleviate financing constraints by conveying value‐relevant information to the market (the information effect) or may exacerbate financing constraints by impairing market liquidity and distorting insiders’ incentives to disclose value‐relevant information (the confidence effect). We examine the significance of these two contrasting effects by investigating the link between insider trading and financing constraints as measured by the investment‐cash flow sensitivity. We find that, overall insider trading exacerbates financing constraints; however the information effect dominates the confidence effect for insider purchases. Only trades by executive directors are significantly related to financing constraints.     

A Flexible Neuro‐Fuzzy Approach for Improvement of Seasonal Housing Price Estimation in Uncertain and Non‐Linear Environments

Changes in housing price affect both individuals and government since they have substantial influence on the socio‐economic conditions. Valuations of housing are necessary in order to assess the benefits and liabilities in housing sector. This study presents a flexible meta‐modelling approach for improvement of housing price estimation in ambiguous and complex environments. It is composed of artificial neural network (ANN) and fuzzy linear regression (FLR). Seven FLR models are considered to cover latest approaches and viewpoints. Also, ANN is applied to data sets. The preferred FLR model is selected via mean absolute percentage of error (MAPE) for further considerations, and then the preferred FLR model and the best structure of ANN are applied to the data set. Finally, the preferred model is selected based on MAPE. The intelligent approach of this study is applied for estimation and forecasting housing price in Iran. The housing price in Iran mainly is based on eight economic indices including currency, oil income, general index, house service pricing index, rate of informal market, gross domestic production in basic price, added value of oil group and construction materials price. FLR is identified as the preferred model with lowest MAPE for housing price forecasting in Iran. This shows that the housing market of Iran is associated with severe environmental fuzziness and ambiguity. This is the first study that introduces a flexible neuro‐fuzzy approach for improved estimation and forecasting of housing price in noisy, complex and uncertain environments.     

Evaluating spatial and temporal variation in agricultural output elasticities in Turkey

This study evaluates spatial variation in the relationship between agricultural output and input use across Turkey. The potential impact of the national agricultural policy reform introduced in 2001 on the spatial variation in agricultural output elasticities across the country was explored. By applying a spatial production function to the province‐level data in 2000 and 2007, spatial heterogeneity in the variance of provincial total factor productivity and the input factor‐output elasticities was identified across the country. Results show that the disparities in agricultural activities and geographic conditions affected return from input factors. Empirical findings from a spatial spillover model also suggest that changes in the input factor‐output elasticities varied significantly across Turkey between 2000 and 2007, after the policy reform. Results suggest that future policy reform that recognizes regional comparative advantage through understanding the geographic heterogeneity of the agricultural sector is important for enhancing Turkey's agricultural output.     

Recent progress in the empirical analysis of multi-unit auctions

I discuss some recent progress in the empirical analysis of multi-unit auctions, through which a number of important commodities (Treasury bills and bonds, electricity, emission permits, monetary infusions by some central banks) are allocated.