Switching customers from branches to internet: A credit union's journey

This research paper reports how a credit union applied knowledge from the literature to solve a marketing problem. A credit union serves a unique group of customers who may be in the same profession, have the same employer, or simply in the same regional location. The marketing problem is how to switch bank customers from branches to internet for the main reason of reducing transaction costs. The research model comprises the independent factors of customer, transaction, application, and bank; and the dependent variables the number of internet banking transaction, perceived usefulness of internet banking, and willingness to use internet banking measuring different aspects of internet banking. We carried out an on-site survey in different branches of our subject credit union to capture the opinion of customers who rely solely on branches for banking transactions. To our knowledge, this study provides a pioneer internet banking survey in the context of credit unions. The survey results reveal different internet banking facilitators for customers with and without internet bank accounts. For customers with internet bank accounts, application security is the most important facilitator variable for them to continue its use in the future; while promises for continuous improvement can be a prohibitive variable. In order to encourage customers without internet bank accounts to adopt internet banking, the management should focus on strengthening the variables of bank diversified service, bank responsiveness, bank image, and extra online instruction and feedback for complicate internet transactions; and reducing the negative effect of web fun/entertainment. We also found that the variables of proficiency in using computers, application security, and bank image have opposite effects on customers with and without internet bank accounts.     

Estimating the frequency of price re-optimization in Calvo-style models

This paper assesses the empirical performance Calvo style models of price re-optimization. We first show that versions of these models in which firms update non-re-optimized prices to lagged inflation account well for the statistical behavior of post-war U.S. inflation rates. We then investigate whether these models imply plausible degrees of inertia in price setting behavior by firms. They do, but only if we depart from two standard auxiliary assumptions: monopolistically competitive firms face a constant elasticity of demand, and capital is homogeneous and can be instantaneously reallocated after a shock. We develop a version of the model in which these assumptions are relaxed and show that it is consistent with the view that firms re-optimize prices, on average, once every two quarters.     

Mortgages and bonds: The asset management practices of Australian life insurers to 1960

Recent studies of the experience of the British life insurance industry indicate that a period of transition, and the development of more diversified investment strategies, began in the interwar period. Australian life insurers lagged behind their British counterparts in the introduction of such strategies. This paper investigates why this was the case. It argues that in the Australian market there was both a lack of opportunity and incentive to broaden asset portfolios. However, this did not mean that asset management practices did not advance. Australian life offices became progressively more sophisticated in their approach to portfolio management during this period. Developments in the interwar period provided a grounding for post-war expansion into the equity market.     

A QUARTERLY MODEL OF AGRICULTURAL INVESTMENT IN AUSTRALIA*

The aims of this study were (a) to attempt to develop a quarterly model to explain aggregate farm investment in Australia, and (b) to examine the concept of the implicit rental price of capital services as a method of taking account of taxation concessions in an investment equation.