Bank/sovereign risk spillovers in the European debt crisis

This paper investigates contagion between bank and sovereign default risk in Europe over the period 2007–2012. We define contagion as excess correlation, i.e. correlation between banks and sovereigns over and above what is explained by common factors, using CDS spreads at the bank and at the sovereign level. Moreover, we investigate the determinants of contagion by analyzing bank-specific as well as country-specific variables and their interaction. Using the EBA’s disclosure of sovereign exposures of banks, we provide empirical evidence that three contagion channels are at work: a guarantee channel, an asset holdings channel and a collateral channel. We find that banks with a weak capital buffer, a weak funding structure and less traditional banking activities are particularly vulnerable to risk spillovers. At the country level, the debt ratio is the most important driver of contagion. Furthermore, the impact of government interventions on contagion depends on the type of intervention, with outright capital injections being the most effective measure in reducing spillover intensity.     

Import prices,income, and inequality

We compare three theoretical explanations for the positive empirical relationship between importer income per capita and traded goods prices. A first explanation is that consumers with higher incomes demand higher quality goods with higher prices. A second explanation is that wealthier people exhibit an increased willingness to pay for necessary goods as more goods enter the consumption set in a hierarchic demand system, and can thus be charged higher markups. A third explanation is that consumers with higher incomes are more finicky regarding their preferred variety in an ideal variety framework and can thus be charged higher markups. We discriminate between these three theories by focusing on the effect of income inequality on trade prices. Based on a large dataset with bilateral HS6 level data on 1260 final goods categories from more than 100 countries between 2000 and 2004, we find a highly significant negative effect of income inequality on unit values. This contradicts both the demand for quality and finickyness theories, while providing support for the increased willingness to pay theory linked to hierarchic demand. These findings on income inequality do not falsify the quality expansion model and the ideal variety model per se. However, the results do argue for place of importance of hierarchic demand.     

Adam Smith's growing concern on the issue of distributive justice

According to the accepted view, Smith carved out distributive justice from his concept of justice and argued that distributive justice would follow in the wake of natural liberty. In recent contributions, however, it is emphasized that a system of natural liberty will only generate beneficent distributional outcomes if the rules of commutative justice safeguard natural liberty and mirror community standards of justice. In this paper it is argued that Smith increasingly came to question whether commercial society could meet this requirement. Given their subservience to sectional interests, rules of justice neither safeguard natural liberty nor conform to community standards. Moreover, the inherent strain in commercial society to corrupt man's moral sentiments erodes community standards of justice. In the development of Smith's views his growing concern for distributive justice is reflected.     

The welfare effects of free trade agreements in quantitative trade models: A comparison of studies about Transatlantic Trade and Investment Partnership

We compare different methodological approaches to predicting the welfare effects of trade policy experiments. We focus on studies that estimate the economic effects of the Transatlantic Trade and Investment Partnership (TTIP). Methodologically, the studies can be divided into those employing computable general equilibrium (CGE) models and structural gravity (SG) models. We compare and critically discuss differences in the estimated trade cost reductions and in the economic models employed, and how these can explain the relatively wide range of economic effects found in the different TTIP studies. We conclude that reasonable estimates of the welfare effects for the TTIP partners are between 0.5% and 2%.     

Trade costs,quality and the skill premium

We develop a monopolistic competition model with non‐homothetic factor input bundles where increasing quality requires increasing use of skilled workers. As a result more skill abundant countries export higher quality, higher priced goods. Using a multi‐country dataset, we test and confirm the findings in Schott ( 2004 ) of a positive effect of skill abundance on unit values identified with US data. We extend the core model with per unit trade costs leading to the Washington apples effect that goods shipped over larger distance are of higher quality. The combination of high‐quality goods being relatively skill intensive with the Washington apples effect implies that countries at a larger distance from their trading partners display a higher skill premium. Simulating our model, we find that a doubling of distance of a country relative to all its trading partners raises the skill premium in a country by about 1.6%.     

Public Professionals and Policy implementation

Abstract

Nowadays, public policies often focus on economic values, such as efficiency and financial transparency. Public professionals often resist implementing such policies. We analyse this using the concept of ‘role conflicts’. We use a novel approach by conceptualizing and measuring role conflicts on the policy level, thereby linking policy implementation and social psychology research. We construct and test scales for policy-client, policy-professional and organizational-professional role conflicts. Using survey data, we show that policy-professional and policy-client role conflicts negatively influence the willingness of public professionals to implement policies. In concluding, we conceptualized and measured three role conflicts that can occur during policy implementation.     

George gives to geology Jane: The name letter effect and incidental similarity cues in fundraising

• People tend to like others with attributes similar to their own (the similarity principle) and favor products with names similar to their own (the name letter effect).
• In the present field experiment, the name letter effect and similarity principle are tested in a phonaton among alumni of Utrecht University, The Netherlands. First name and surname initials, fields of education, and association memberships of alumni were matched to those of students soliciting contributions in the phonaton.
• Female alumni with first names and fields of study similar to those of solicitors were more likely to donate, as were male alumni with first names similar to the field of study of solicitors. Both male and female alumni with first names similar to the name of the university donated more often than those with dissimilar names.
• Name letter effects are a cheap and effective instrument to increase donations in fundraising campaigns conducted by telephone.

Copyright © 2009 John Wiley & Sons, Ltd.     

Revisiting the notion of cohesion in community sport: a qualitative study on the lived experiences of participants

Research has focused on the question if and how leisure can create social cohesion and can alleviate cultural segregation in divided community contexts. Community sport in particular is believed to create socio-cultural cohesiveness, as it aims at a sense of community, a task in which regular sports often seem to fail. However, the experiences of participants in relation to socio-cultural cohesiveness in community sport remain absent in the existing body of research. This article provides insights into those experiences, by drawing on a qualitative study in Flanders, Belgium. Based on the findings, we challenge the one-sided focus on socio-cultural cohesiveness to obtain a sense of community, as the perspectives of participants reveal that also political and economic dimensions of cohesion are relevant, next to socio-cultural dimensions. We argue that community cannot be reduced to socio-cultural cohesion, but should be understood from the intersection between cultural, economic and political dimensions of cohesion. Implications for practice, both in relation to community sport and the broader leisure field and further research are given.     

Caught By Surprise?

Abstract

New social network technology (Web 2.0) provides individuals and small groups with powerful resources for rapid political mobilization. This can create strategic surprises to policy-makers. Two cases of Web 2.0 driven micro-mobilization processes are considered. In both cases, new network technology helped the process of issue-expansion on which the emergence of these strategic surprises is dependent. Policy-makers were taken by surprise because their repertoires of action are focused primarily on official arrangements of consultation and on the news coverage by traditional media. Policy-makers' capacities and resources are not attuned to the political use of network technology by citizens.     

Differences in technology transfer between science-based and development-based industries: Transfer mechanisms and barriers

Although several studies in the wide body of literature on technology transfer have hinted at differences across industries, this still remains an understudied issue. Our study addresses this topic and considers to what degree technology transfer processes differ across different industrial sectors. To that end, we study to what extent technology transfer processes differ along both types of transfer mechanisms and key barriers inhibiting the transfer process. Based on a survey of Dutch practitioners on both sides of the transfer process, we test a number of hypotheses that differentiates between science-based regimes and development-based regimes. While our findings confirm our hypotheses concerning differences between the regimes regarding the use of specific transfer mechanisms, we also find that both regimes share a number of mechanisms that are similar. In addition, our findings show a remarkable degree of similarity among barriers inhibiting the process. We discuss these findings within the context of the broader literature and formulate policy implications.