Bank lending margins in the euro area: Funding conditions,fragmentation and ECB's policies

In this paper we study the determinants of lending margins paid by euro‐area corporates for their bank loans. Across two separate groups of countries (distressed and non‐distressed) we examine whether lending margins have been affected by structural changes in the banking sector, the credit and liquidity position of banks and the costs of funding in the corporate and sovereign bond markets. The role of ECB policies with respect to narrowing down the fragmentation in the bank lending channel is also investigated through a structural panel VAR model for the period 2003:1 to 2014:12.     

Quantifying the evolution of world trade, 1870–1949

The typical narrative regarding the evolution of world trade prior to World War II refers to a secular rise starting around 1870 and a subsequent collapse beginning in 1914. This narrative, however, is based on measures of trade openness that do not fully take into account purchasing power differences across countries. Due to lack of alternative data, the measures employed in the existing literature are typically based on non-PPP-adjusted trade data denominated by PPP-adjusted GDP data. The present paper seeks to resolve this inconsistency by constructing new trade share estimates for 62 countries, representing 90% of world GDP, for the period from 1870 to 1949. Our estimates combine historical import and export figures with non-PPP-adjusted GDP values that we estimate via the short-cut method. Our estimates confirm qualitatively the narrative of a dramatic rise and fall of world trade over this period. Yet, they indicate that this rise and fall was quantitatively much more pronounced. We find that trade shares were on average 38% higher than previously documented and the world's level of trade openness in 1913 was comparable to that in 1974.     

Citizens’ Perceptions on Water Conservation Policies and the Role of Social Capital

Planning and implementing environmental policies for the sustainable management of water resources is a challenging task. In order to improve the effectiveness of these policies it is essential to explore their social implications. The present article aims to investigate environmental policies focusing on domestic water conservation and their interconnection with social capital elements. In particular, by means of an empirical study conducted in an insular community of Greece, citizens’ perceptions are explored concerning the restrictions imposed from different environmental policy instruments for water consumption and their perceived level of effectiveness. Furthermore, the influence of social capital parameters on these perceptions is investigated. Aggregated indicators of social capital are estimated with Confirmatory Factor Analysis measuring social and institutional trust, participation in social networks and compliance with social norms. Through the results of ordinal regression models it is evident that significant connections exist between elements of social capital and perceptions of citizens towards water consumption policies.     

US Security Strategy and the Gains from Bilateral Trade

We explore the geo‐strategic determinants of bilateral trade flows between the USA and the rest of the world. We develop a three‐party model of security and trade patterns and use data on military assistance and troop deployments over the 1950–2009 period to validate its predictions. We find that security assistance has significant, positive impacts on the shares of bilateral trade between the USA and the recipient country, results that are robust to issues of reverse causality and hold across different sectors.     

Bayesian Modelling of Outstanding Liabilities Incorporating Claim Count Uncertainty

Abstract

This paper deals with the prediction of the amount of outstanding automobile claims that an insurance company will pay in the near future. We consider various competing models using Bayesian theory and Markov chain Monte Carlo methods. Claim counts are used to add a further hierarchical stage in the model with log-normally distributed claim amounts and its corresponding state space version. This way, we incorporate information from both the outstanding claim amounts and counts data resulting in new model formulations. Implementation details and illustrations with real insurance data are provided.     

Beyond the WTO? An Anatomy of EU and US Preferential Trade Agreements

It is often alleged that PTAs involving the EC and the US include a significant number of obligations in areas not currently covered by the WTO Agreement, such as investment protection, competition policy, labour standards and environmental protection. The primary purpose of this study is to highlight the extent to which these claims are true. The study divides the contents of all PTAs involving the EC and the US currently notified to the WTO, into 14 ‘WTO+’ and 38 ‘WTO‐X’ areas, where WTO+ provisions come under the current mandate of the WTO, and WTO‐X provisions deal with issues lying outside the current WTO mandate. As a second step, the legal enforceability of each obligation is evaluated, and judged on the extent to which the text specifies clear obligations. Among the findings are: (i) EC agreements contain almost four times as many instances of WTO‐X provisions as do US agreements; (ii) but EC agreements evidence a very significant amount of ‘legal inflation’ (i.e. non‐legally enforceable provisions) in the WTO‐X category, and US agreements actually contain more enforceable WTO‐X provisions than do the EC agreements; (iii) US agreements tend to emphasise regulatory areas more compared to EC agreements.     

应对大宗商品危机

近期大宗商品价格出现了三十年未见的大幅波动，并还将持续一段时间。 消费品公司必须了解行业的这一“大循环”、其如何影响业务以及它们如何应对风险管理和成本控制的双重挑战。     

Different orders of one-sided scale elasticities in multi-output production

In this paper we explore properties of different orders of one-sided scale elasticities in multi-input multi-output production using the theoretical framework developed by Hadjicostas and Soteriou (Eur J Oper Res 168:425–449, 2006), Krivonozhko et al. (J Oper Res Soc 55:1049–1058, 2004), and others. That framework includes as a special case the well-known operations research method of data envelopment analysis (DEA). A special case of the theory in this paper is the Banker-Morey (Oper Res 34:513–521, 1986a) DEA model for data that include both discretionary and non-discretionary inputs and outputs. Several inequalities among different orders of one-sided scale elasticities are presented. An example is used to illustrate many of the results and ideas of the paper. Finally, we show how the theory and results of this paper can be used to shed some light on implicit Hicks input technical change.     

Does the Theory of Irreversible Investments Help Explain Movements in Office–Commercial Construction?

Focusing on the relevance of the modern investment theory in explaining movements in office–commercial construction, we attempt to advance existing empirical work in two respects. First, building on recent theoretical advances, we offer an extended empirical model of new construction that takes into account the full opportunity cost of irreversible investments in uncertain environments. Second, using updated time series of office–commercial construction across the nation's largest markets, we empirically estimate such a model to (i) explore investment behavior during 1982–1998 and (ii) detect differences, if any, in such behavior between the pre- and post-recession years. Our empirical findings are fully consistent with the theory of irreversible investments. Such findings highlight both the relevance and the relative importance of uncertainty in underlying demand factors in shaping movements in office–commercial construction, while pointing altogether to more cautionary investment behavior during the post-recession years.