Effects of interest rate caps on credit access

Journal of Regulatory Economics - We study the liberalization of the microcredit usury rate in Colombia and its effects on loan expansion. In February 2007 the interest rate ceiling for microcredit...     

IPSAS in Latin America: innovation,isomorphism or rhetoric?

ABSTRACT

Over the past 30 years, many initiatives have been undertaken to reform public administration in Latin American countries. Among other aspects, the reforms seek to improve the transparency and accountability of the public sector by modernizing public accounting and budgeting systems. The adoption of accrual accounting in the public sector has been seen as an innovation and it is driven by the implementation of IPSAS. This paper sheds light on the process of reform of public financial management in Latin America and the state of implementation of IPSAS. The paper analyses the driving forces for adopting or adapting IPSAS, as well as the obstacles and challenges in doing so.     

REIT Going Private Decisions

Over the recent decade there was a wave of REITs going private, from an average of about three per year to 40 between 2005 and 2007. Standard corporate finance theory posits that firms go private when there is no longer a positive tradeoff between the expected benefits and the costs of being public, and it provides empirical evidence that going private decisions are motivated by potential gains from leverage, tax benefits, and expected improvements in corporate governance. Given the unique institutional environment for the REIT industry, this paper sheds new light on the going-private decision. Specifically, we examine the determinants of the going-private decision and document announcement wealth changes using a sample of 160 REITs from 1985 to 2009. We find firm performance and agency-related factors significantly impact the probability that a REIT announces to go private. We find that the passage of Sarbanes-Oxley and a proxy for differential performance in the private and public markets have no significant impact on the decision. The announcement day abnormal return is almost 12% and the three-day abnormal return is 15%, magnitudes that are both statistically and economically significant. Variations in the market reaction are associated with lower levels of cash and higher stock price volatility. Overall, we document a new set of going-private factors and wealth impacts for the REIT industry that are unique from those of previous corporate finance literature.     

Self-Service Technologies and e-Services Risks in Social Commerce Era

In this paper we argue that greater attention must be given to peoples’ expression of “care” in relation to consumption. We suggest that “caring about” does not necessarily lead to “care-giving,” as conceptualising an attitude–behaviour gap might imply, but that a closer examination of the intensity, morality, and articulation of care can lead to a greater understanding of consumer narratives and, thus, behaviour. To examine this proposition, a purposive sample of self-identified ethical consumers was interviewed. Care is expressed by the study’s participants in a variety of ways and linked to behaviour through diverse patterns that includes consumption and abstention. We find significant correspondence between the academic literature on the ‘ethics of care’ and our participants’ articulation of their ethical consumption behaviours. We suggest, therefore, that a close understanding of an ethics of care among consumers is important both in providing insight into the attitude–behaviour gap challenge evident in the literature and to the continued development of an ethical consumption discourse.     

THE WEALTH DISTRIBUTION WITH DURABLE GOODS*

In the United States, the distribution of houses is less egalitarian than that of earnings for the total population, but these two distributions are remarkably similar for homeowners. Additionally, housing as a fraction of total wealth decreases with the level of wealth. In order to understand the different factors that account for these wealth composition patterns, we introduce illiquid houses and collateral credit in a general equilibrium model of heterogeneous agents with idiosyncratic uncertainty. A combination of very persistent shocks to earnings, frictions in the housing market, and a rental market is necessary to obtain numbers in line with the evidence.     

The evolution and use of a policy and research tool: assessing the technological capabilities of firms

Firms differ widely in their technological capabilities. Innovation policies are likely to be more or less successful depending upon the level of such abilities of those firms to which a policy is aimed. Without data on the proficiencies, strengths and weaknesses of firms within the target group(s), the construction and application of innovation or industrial policies are likely to miss salient factors in the ability of firms to benefit from the support that is intended. An in-depth knowledge of firms’ capabilities can allow policy-makers to target support according to the specific needs of firms. This paper describes the Technology capability audit tool (or CAT) that was designed to assist policy-makers in differentiating between firms and in understanding their level of ‘innovation readiness’. Examples of the use of the CAT are presented from South Korea, Thailand, Ireland, Brazil and the UK.     

Software Transparency

Software transparency is a new and important concern that software developers must deal with. As society moves towards increased automation, if citizens wish to exercise their right to know, the transparency of public services and processes acquires fundamental importance. Informed discourse is only possible if processes affecting the public are open to evaluation. Achieving software transparency to this level of openness faces several roadblocks. The paper reports on initial findings on exploring the obstacles for enabling software transparency.     

Modeling Spatial and Temporal House Price Patterns: A Comparison of Four Models

This research reports results from a competition on modeling spatial and temporal components of house prices. A large, well-documented database was prepared and made available to anyone wishing to join the competition. To prevent data snooping, out-of-sample observations were withheld; they were deposited with one individual who did not enter the competition, but had the responsibility of calculating out-of-sample statistics for results submitted by the others. The competition turned into a cooperative effort, resulting in enhancements to previous methods including: a localized version of Dubins kriging model, a kriging version of Clapps local regression model, and a local application of Cases earlier work on dividing a geographic housing market into districts. The results indicate the importance of nearest neighbor transactions for out-of-sample predictions: spatial trend analysis and census tract variables do not perform nearly as well as neighboring residuals.     

Comment on 'Market discipline and monetary policy' by Carl Walsh

This paper shows that the results Walsh (2000, Market disciplineand monetary policy, Oxford Economic Papers, 52, 249–71)obtains are highly sensitive to the assumption that differentwage contracts are based on different information sets eventhough they are negotiated simultaneously. In particular, thepower of future expectations to discipline an opportunisticcentral banker is much weaker when homogeneous information setsare used.