Credit Constraints in Manufacturing Enterprises in Africa

We investigate the question of whether firms in Africa's manufacturingsector are credit constrained. The fact that few firms obtaincredit is not sufficient to prove constraints, since certainfirms may not have a demand for credit while others may be refusedcredit as part of profit maximising behaviour by banks. To investigatethis question, we use direct evidence on whether firms had ademand of credit and whether their demand was satisfied in theformal credit market, based on panel data on firms in the manufacturingsector from six African countries. Of those firms with a demandfor credit, only a quarter obtained a formal sector loan. Ouranalysis suggests that while banks allocate credit on the basisof expected profits, micro or small firms are much less likelyto get a loan than large firms. We also find that outstandingdebt is positively related with obtaining further lending. Therole of outstanding debt is likely to be a reflection of inefficiencyin credit markets, while the fact that size matters is consistentwith a bias as well, although we cannot totally exclude thatthey reflect transactions costs on the part of banks. We presentan analysis showing how much more profitable small firms mustbe to obtain a loan than large firms.     

A new measurement procedure for attitudinal research. Analysis of its psychometric and informational properties

Since measurement errors have strong effects in all relationships (statistical or otherwise) studied, there is an increasing interest in the data quality, which is the major justification for this research. This paper aims to present a new measurement procedure, the letter scale, which avoids many of the problems connected with the response modalities traditionally used in attitudinal research, especially the ordinal categorical scales. This paper analyzes the error composition of the scores obtained with this new measurement procedure. The validity of the procedure is also analyzed and the observed variance is assessed to determine which part of the observed variance is “valid”, which part is random error (attenuating relationships) and which is correlated error (magnifying relationships). Structural equation models will be used to provide estimates of the measurement quality: (i) Reliability, (ii) Construct validity, method effect and residual variance. In addition, this letter scale is evaluated under another different perspective, Information Theory measures are also used to assess the amount of information transmitted. The relative merits of this new measurement procedure as opposed to other common response modalities will be discussed in both cases.     

A measurement model for psychophysical scaling

In the literature very little attention has been given to psychophysical scaling, even though this kind of measurement provides many advantages, such as continuous interval scales, more precision, possibilities for easy replications and therefore for correction of measurement error. Besides all kinds of technical reasons one possible explanation for this lack of attention is that the procedures have always been described as completely different from the commonly used measurement procedures. Also, the tests which have been suggested for the quality of the results were quite different from the commonly used procedures. In this paper it will be shown that psychophysical scaling can be formulated in a congeneric test model, i.e., all the commonly used criteria for the quality of measurement instruments like reliability and validity can be applied in the usual way. An illustration of this will be given. Furthermore it will be shown that psychophysical scales are not ratio scales but that they satisfy the requirements of a (log)interval scale.     

Theory in consumer behavior: A status report

This article examines the attitudes of 40 opinion leaders in marketing toward theory in consumer behavior. These individuals exhibited favorable attitudes toward theory in marketing in general. More favorable perceptions of the value of the contributions of theory to consumer behavior existed than for promotion and channels of distribution. In comparison to eight other areas of marketing, the consumer behavior area was perceived as having made the greatest past contribution to marketing thought and the one most likely to make worthwhile future contributions. The sample believed that much future effort was needed in progressing toward a general theory of consumer behavior and that such effort would indeed be forthcoming.     

Measuring the Competitiveness of China's Processed Exports

China's surplus in processing trade remains large. Processed exports are final goods produced using parts and components that are imported duty free. Because much of the value‐added of these exports comes from East Asia, exchange rates throughout the region should affect their foreign currency prices. This paper presents data on value‐added exchange rates for processed exports over the 1993–2013 period and reports that they significantly affect exports. While the renminbi appreciated 36 percent between the beginning of 2005 and the end of 2013, exchange rates in supply chain countries depreciated. This has mitigated the effect of the RMB appreciation on the price competitiveness of processed exports.     

Cash Management, Payment Patterns and the Demand for Money

We analyse cash management and payments behaviour using 1990–1994 panel data for Dutch households. The results largely confirm the transactions demand for money theory, including an income elasticity of substantially less than one, and they are consistent with the hypothesis of technology resulting in households' economizing on currency balances. The results indicate up to 40 per cent lower transactions balances in the future, which is affirmed by direct questioning on future expectations. The effect on total money outstanding is considerably lower, due to significant amounts of missing money in hoards, which are insensitive to new developments in the payments system.     

The anatomy of fragile states in Sub‐Saharan Africa: Understanding the interrelationship between fragility and indicators of wellbeing

According to most classifications, Sub‐Saharan Africa is the region of the world with the highest presence of fragile states. In this paper we examine the relationship between fragility and poverty, suggesting that countries may become trapped in a vicious circle of fragility and low levels of wellbeing. We consider fragility as a continuum and begin by reviewing available measures. These show the high presence of fragility in Sub‐Saharan Africa and allow the more fragile countries to be identified. There is seen to be a strong association between fragility, poor growth performance, and lower wellbeing in Sub‐Saharan Africa. Building on the strong evidence for the two‐way relationship between economic growth and poverty, we present an analysis of how the vicious circle linking poorer welfare outcomes and fragility may be able to be broken. We argue that building successful institutions is key here, and this can be enabled by specific policy interventions that are both poverty reducing and productive.