On emerging stock market contagion: The Baltic region

This study provides new evidence on emerging stock market contagion during the Global Financial crisis (GFC) and the Euro zone Sovereign Debt Crisis (ESDC). Focusing on the three emerging Baltic markets and developed European markets, proxied by the EUROSTOXX50 stock index, we explore asymmetric dynamic conditional correlation dynamics across stable and crisis periods. Empirical evidence indicates a diverse contagion pattern for the Baltic region across the two crises. Latvia and Lithuania were contagious during the GFC, while they were insulated from the adverse effects of the ESDC. On the other hand, Estonia decoupled from the negative consequences during the global turmoil period, but recoupled during the ESDC. The results could be attributed to financial and macroeconomic characteristics of the Baltic countries before and after the turmoil periods and the introduction time of the Euro as a national currency.     

当前差别存款准备金政策的制约因素及对策

差别准备金动态调控政策是我国建立逆周期宏观审慎管理框架,防范金融机构系统性风险的重要举措。本文围绕宏观审慎管理念和差别化调控思路,结合淄博市法人金融机构的具体情况,分析了2011年差别准备金动态调控中遇到的机制障碍,就如何完善差别准备金动态调控工具提出了政策建议。     

ECONOMIC RECESSIONS,BANKING REFORM AND THE FUTURE OF CAPITALISM1

In the 2010 London School of Economics and Political Science Hayek Memorial Lecture, the author argues that flaws in the design of the monetary and financial system were responsible for the global financial crisis and the subsequent recession. The crash reflected the unsustainable nature of the bubble induced by artificial credit expansion created by fractional‐reserve banking under the direction of central banks. Such boom–bust cycles will continue until radical reforms are implemented, including a 100% reserve requirement for demand deposits.     

Risk-Taking Behavior and Capital Adequacy in a Mixed Banking System: New Evidence from Malaysia Using Dynamic OLS and Two-Step Dynamic System GMM Estimators

This study is the first attempt to investigate the relationship between the level of risky assets and capital level in a mixed Malaysian banking system covering 83 months starting December 2006. The results of dynamic ordinary least squares indicate positive relationship between capital ratio (CAR) and risk-weighted asset ratio (RWA) in the long run. Furthermore, the causality analysis based on panel vector error correction model (VECM) and two-step dynamic system generalized method of moments indicates unidirectional causality from CAR to RWA. Our results further suggest that higher capital growth and capital buffer provide an extra cushion for the Malaysian banks to pursue relatively riskier financial activities, and the nature of risk-taking behavior of Islamic banks follows that of the conventional banks.     

Dynamics of female labour force participation in France

This article formulates and estimates a structural intertemporal model of labour force participation. Relying on theoretical characterizations derived from an economic model of lifetime behaviour, we estimate a dynamic probit model with correlated random effects using longitudinal data to allow for a dynamic structure. The model is applied to a panel of married women drawn from the 1997–2002 French Labour Force surveys in order to represent their participation behaviour. It is estimated by maximum simulated likelihood. Our results show that women’s decisions to go out to work are characterized by significant state dependence, unobserved heterogeneity and negative serial correlation in the transitory error component. In addition, we find that the presence of young children in a woman’s household reduces her labour participation, but unequally according to their age and number. As expected, educational level has a positive impact on women’s participation. Last, a rise in the husband’s wage is found to raise female participation initially and to lower it subsequently. This empirical finding suggests that leisure may not systematically be a normal good, contrary to what is frequently assumed in the literature.     

A general endogenous grid method for multi-dimensional models with non-convexities and constraints

The endogenous grid method (EGM) significantly speeds up the solution of stochastic dynamic programming problems by simplifying or completely eliminating root-finding. We propose a general and parsimonious EGM extended to handle (1) multiple continuous states and choices, (2) multiple occasionally binding constraints, and (3) non-convexities such as discrete choices. Our method enjoys the speed gains of the original one-dimensional EGM, while avoiding expensive interpolation on multi-dimensional irregular endogenous grids. We explicitly define a broad class of models for which our solution method is applicable, and illustrate its speed and accuracy using a consumption–saving model with both liquid assets and illiquid pension assets and a discrete retirement choice.     

The globalization indicators-tourism development nexus: a dynamic panel-data analysis

This study investigates how economic, social, and political globalization indicators influence tourism development. We applied different approaches of panel regression to panel data from a sample including 133 countries between 1995 and 2014. The results indicate that economic, social, and political globalization are significant factors for tourism development. Thus, this study proves that economic, social, and political integration of countries are significant driving forces behind their tourism development.     

Risk analysis of the EASA minimum fuel requirements considering the ACARE-defined safety target

We present the results of flight simulator experiments (60 runs) with randomly selected airline pilots under realistic operational conditions and discuss them in light of current fuel regulations and potential fuel starvation. The experiments were conducted to assess flight crew performance in handling complex technical malfunctions including decision-making in fourth-generation jet aircraft. Our analysis shows that the current fuel requirements of the European Aviation Safety Agency (EASA) are not sufficient to guarantee the safety target of the Advisory Council for Aviation Research and Innovation in Europe (ACARE), which is less than one accident in 10 million flights. To comply with this safety target, we recommend increasing the Final Reserve Fuel from 30 min to 45 min for jet aircraft. The minimum dispatched fuel upon landing should be at least 1 h.     

Cropland expansion and grassland loss in the eastern Dakotas: New insights from a farm-level survey

The western Corn Belt region of the United States has become a hotspot for agricultural extensification and consequent land use and land cover changes. The goals of this research were to characterize geographic patterns of grassland loss resulting from cropland expansion in the eastern Dakotas, and to understand how these changes were associated with characteristics of individual farms and farm operators. We collected data on grassland conversion and other land use decisions through a mail survey of farm operators in North and South Dakota. Overall, 40% of respondents converted at least some grassland to cropland between 2004 and 2014, and the total acreage of converted grassland was equivalent to 5.1% of the surveyed farm acreage. Although most converted grassland acres (3.2% of farm acreage) were from land enrolled in the conservation reserve program (CRP), there were also substantial amounts of native grassland conversion (1.0%) and tame grassland conversion (0.9%). The total acreage of grassland conversion was more than four times larger than the acreage enrolled in CRP and other conservation programs. Different types of grassland conversion (e.g., native grassland versus CRP) were concentrated in different parts of the study region, and were spatially disjunct from the areas of highest conservation program enrollment. Larger farms were more likely than smaller farms to expand their cropland acreage and accounted for a disproportionate share of grassland conversion. Younger farm operators, higher levels of farm income, higher proportions of rented croplands, and marginal yields were also associated with cropland expansion and grassland conversion. Although CRP and other land retirement programs will remain important policy mechanisms for conservation in this region, they are not sufficient to maintain current levels of grassland cover and do not provide protection for native grasslands. Alternative conservation strategies and new agricultural policies are thus critically needed to maintain the ecosystem services provided by grasslands.     

Efficiency evaluation of the regional high-tech industry in China: A new framework based on meta-frontier dynamic DEA analysis

This paper proposes a new framework based on the combination of the dynamic DEA, meta-frontier analysis theory, and truncated regression model, and then focuses on the efficiency evaluation of regional high-tech industries in China. For all of the overall technical efficiency, technical efficiency, and scale efficiency scores, the east area is always in the lead, with the central and west areas obviously lagging behind. The eastern area has the highest technology level, whereas the west and central areas fall behind in turn. However, the meta-technology ratio of the west area has rapidly increased and presents a trend of catching up with the east. The variables of GRP per capital, total exports and imports, highway mileage per capita, and ratio of tertiary industry to GRP have positive relationships with technical efficiency, and the time trend exhibits a negative coefficient.