Through-the-Cycle Ratings Versus Point-in-Time Ratings and Implications of the Mapping Between Both Rating Types

The two philosophies of ratings, one that includes cyclical effects and the other that doesn't, are mirrored by the two different rating types commonly known as point-in-time (pit) and through-the-cycle (ttc). Point-in-time ratings try to evaluate the current situation of a customer by taking into account both cyclical and permanent effects. In contrast, through the-cycle ratings focus mainly on the permanent component of default risk and are nearly independent from cyclical changes in the creditworthiness of a customer. In this paper we give a review of the characteristics of both rating types and examine whether these properties can actually be observed in practice. In this context we present the results of an analysis of Standard& Poor's rating data, which show that the ratings, though being through-the-cycle, still vary in accordance with the business cycle. Another concern of this paper is the wide spread practice to map 'external' through-the-cycle ratings to 'internal' point-in-time ratings, with the purpose to enrich or validate a financial institution's internal rating database. We show that in doing so financial institutions severely misspecify customers' risk profiles and under- or overestimate costs in connection with credit pricing or capitalization. We confirm our theoretical considerations by calculating pricing quantities when using one or the other rating information.     

Subject pool effects among the general population and students: a choice experiment example

Rising costs of conducting research coupled with limited budgets are forcing researchers to use samples of convenience. Students represent one such sample, but are students an appropriate population? The objective is to ascertain how students’ willingness to pay (WTP) differs from the general public’s WTP. Students and county residents are surveyed. Results suggest the study’s goal may determine if student responses are generalizable to the general population. The samples are similar in many characteristics, but WTP amounts vary. The student samples show some inconsistencies. If the goal is general behavioural inferences, the results provide support for the use of students. If the goal is to estimate specific WTPs for use in policy analysis, the use of students may not be advisable.     

Crossing Cultural Boundaries: A Multicultural Kindergarten in Hong Kong

Confronted with the rise of a new group within its organization, Small World, an international Christian kindergarten in Hong Kong, is being forced to reconsider its boundaries. The trend towards more applications to international schools by Hong Kong Chinese, adds an extra dimension to the already extensive cultural diversity among the kindergarten's staff, students and their parents. Describing the appreciation for cultural diversity amongst staff and parents, the strategies that are used to maintain harmony and the motives that (Hong Kong Chinese) parents have for participation in the school, it is argued that only one effect of globalization on the macro level can be identified on the micro and meso level, namely indigenization. The article shows how parents, staff and the organization all try to adopt attractive or useful elements of foreign cultures without giving up their own culture, and subsequently foster multiculturalism in an attempt to reach their goals, these being the cultural competence of their children for Hong Kong Chinese parents and success for the organization. The resulting demand for the incorporation of extra foreign elements in the curriculum is forcing Small World to reconsider its boundaries.     

Markups in the Euro area and the US over the period 1981–2004: a comparison of 50 sectors

This article provides estimates of price–marginal cost ratios or mark-ups for 50 sectors in eight Euro area countries and the US over the period 1981–2004. The estimates are obtained applying the methodology developed by Roger (J Polit Econ 103:316–330, 1995) on the EU KLEMS March 2007 database. Five stylized facts are derived. First, perfect competition can be rejected for almost all sectors in all countries; markup ratios are generally larger than 1. Second, average markups are heterogeneous across countries. Third, markups are heterogeneous across sectors, with services having higher markups on average than manufacturing. Fourth, services sectors generally have higher markups in the euro area than the US, whereas the pattern for manufacturing is the reverse. Fifth, there is no evidence that there is a broad range change in markups from the 1980s to the 1990s.     

<Emphasis Type="Italic">Duz mich ruhig!</Emphasis>

Zusammenfasung  Streitthema Anrede — Wir Azubis sind noch jung. Viele Patienten oder Bewohner nehmen sich das Recht heraus, uns zu duzen. Ist das ok? Und wie sieht es umgekehrt aus, wenn Pflegekr?fte alte Heimbewohner mit „Du“ anreden?     

The Greek Public Sector Wage Premium before the Crisis: Size,Selection and Relative Valuation of Characteristics

We examine the Greek public–private wage differential before the debt crisis to evaluate the prospective impact of the recent public sector pay cuts. We find a large public premium which persists after controlling for individual and job characteristics. For men, much of this is accounted for by self‐selection into the sector that rewards better their characteristics, while for women it is largely driven by sectoral differences in returns. We attribute these effects to more egalitarian pay structures in the public sector and to demand problems in the private sector. The recent policy measures only partially change this situation, as wage deflation extends to the private sector, preserving public premia for the low paid.     

Perceptions of tourism promotion and business challenges: A survey-based comparison of tourism businesses and promotion organizations

Tourism is an important economic development driver in the U.S. especially in rural areas. Most US regions have tourism-related economic development organizations to assist the local industry. Despite such assistance, however, many tourism-based businesses struggle. One possible reason is a disconnect between business needs and the activities of related organizations. This study uses survey data from tourism-based businesses and tourism promotion and economic development organizations in rural western Pennsylvania and West Virginia to compare how the various actors perceive the most pressing tourism promotion efforts and business challenges. In general, tourism businesses and support organizations agree on the promotional needs of tourism-based businesses and hold similar perceptions about industry problems. However, tourism promotion agencies underestimate the role of the internet in promotions and perceive workforce issues differently than do businesses. Better alignment of priorities within tourism partnerships should enhance promotional and educational efforts as well as the integration of tourism into overall economic development efforts.