discrimination competition and loan performance in fha mortgage lending this study tests for the presence of prejudicial or noneconomic discrimination on the part of mortgage lenders by evaluating the performance of home mortgage loans the approach differs from that of previous studies of loan performance in that it is based on the proposition that noneconomic discrimination should be more pronounced in less competitive lending environments while statistical discrimination should not using a rich set of fha insured loan records and measures of local market concentration to proxy the competitive environment we test for the prediction of better loan performance by minority borrowers relative to white borrowers in more concentrated markets we argue that this approach substantially reduces the potential for omitted variable bias that has cast a shadow on previous studies of lending discrimination results fail to reject the null hypothesis of no noneconomic discrimination

evidence on discrimination in mortgage lending much of the controversy about whether mortgage lenders discriminate against minorities can be explained in terms of the confusion about how to define discrimination based on the legal definition careful studies of loan denial rates such as that done by the federal reserve bank of boston represent an appropriate method for testing for discrimination by lenders based on that study it is quite clear that lenders discriminate the fact that minorities have higher default rates on average than whites is irrelevant to the interpretation of the race coefficient in such models nonetheless more research on and discussion about the relationship between the race of the applicant and delinquencies defaults and losses would be desirable

on the stock control performance of intermittent demand estimators the purpose of this paper is to assess the empirical stock control performance of intermittent demand estimation procedures the forecasting methods considered are the simple moving average single exponential smoothing croston s method and a new method recently developed by the authors of this paper we first discuss the nature of the empirical demand data set 3000 stock keeping units and we specify the stock control model to be used for experimentation purposes performance measures are then selected to report customer service level and stock volume differences the out of sample empirical comparison results demonstrate the superior stock control performance of the new intermittent demand forecasting method and enable insights to be gained into the empirical utility of the other estimators

market structure and discrimination the case of small businesses this paper examines bank market structure to draw inferences concerning the role of discrimination in credit markets for small businesses the authors analyze credit application and denial rates loans outstanding and interest rates across demographic groups this set of variables in combination with information on local bank market structure helps them distinguish among borrower preferences lender tastes and inadequate lender information as likely causes of differences in credit market experiences of small business operators from distinct demographic groups the authors find that white men and women can expect similar treatment in credit markets with some benefits to female owned firms located in concentrated banking markets minorities by contrast fare worse than whites moreover by appealing to becker s 1957 classic theories we find some clear evidence to support the view that prejudicial discrimination is at least partly to blame

on the interaction between forecasting and stock control the case of non stationary demand the effect of using estimated forecast demand parameters on the performance of an inventory control system is an intriguing and important subject recent research has been undertaken on this phenomenon assuming stationary demand data in this paper we extend the research to non stationary demands by means of simulation the case of a periodic order up to level inventory system is considered and the experimental structure allows us to evaluate in a progressive manner the accumulated effect of using the optimal forecasting method optimal forecast parameters and correct variance expression procedures the results allow insights to be gained into operational issues and demonstrate the scope for improving stock control systems

on the calculation of safety stocks when demand is forecasted the inventory control literature generally assumes that the demand distribution and all its parameters are known in practical applications it is often suggested to estimate the demand variance either directly or based on the one period ahead forecast errors the variance of the lead time demand essential for safety stock calculations is then obtained by multiplying the estimated per period demand variance by the length of the lead time however this is flawed since forecast errors for different periods of the lead time are positively correlated even if the demand process itself does not show process auto correlation as a result these traditional procedures lead to safety stocks that are too low this paper presents corrected lead time demand variance expressions and reorder levels for inventory systems with a constant lead time where demand fluctuates around a constant level firstly we derive the exact lead time forecast error of mean demand conditional on the true demand variance secondly we derive for normally distributed demand the correct reorder level under uncertainty of both the demand mean and variance we show how the results can be implemented in inventory models and particularly discuss batch ordering policies combined with moving average and exponential smoothing forecasts we find that traditional approaches can lead to safety stocks that are up to 30 percent too low and service levels that are up to 10 percent below the target

fertility and the size of the u s labor force this paper reviews and interprets from an economic perspective the demographic trends in the u s since the turn of the century the primary focus will be upon the interplay between the fertility and labor force participation of women and how they may be interpreted within simple economic models we will begin by stating what economic demography is and why careful analytic methods are needed section ii provides a brief demographic history of the u s section iii describes the major economic theories of fertility and section iv discusses the empirical performance of these theories section v discusses the linkages between fertility and the size of the labor force and section vi concludes excerpt

symposium on women in the labor market t his symposium contains four essays on the general topic of women in the labor market the essays are varied not only in focus but also in philosophical outlook the topic is of central importance today few economic trends have been more pronounced or sustained than the increased labor force participation of women in 1948 the labor force participation rate of females was 32 7 percent at the end of 1987 it stood at 56 4 percent the growth has been significant even during the 1980s in 1980 the rate was 51 5 percent and it shows little sign of tapering off during the same period the labor force participation rate of males has fallen in 1948 the rate for males was 86 6 percent whereas it was 76 1 percent in 1987 trends toward earlier retirement among males account for some of the change along with other demographic shifts the relative economic position of females has improved during the 1980s a rough look at current population survey data reveals that the ratio of average female weekly wages to average male weekly wages was 58 in 1976 and 59 in 1980 by 1986 it had risen to 62 although some have attributed this narrowing to the lack of appreciable growth in male weekly wages rather than to progress in female weekly wages no similar trend exists for other groups in particular black males have not done well over the same period relative to white men in 1976 the ratio of black male weekly wages to white male weekly wages was 70 in 1986 it was 66 thus there is something significant about females that is absent for other disadvantaged groups in the labor market this progress is confined to white women for the most part the ratio of black female weekly wages to white female weekly wages was 89 in 1974 and reached a peak of 93 in 1979 it fell back to 88 by 1986

bayes solution to dynamic inventory models under unknown demand distribution this paper considers the periodic review inventory problem for which one or more parameters of the demand distribution are unknown with a known prior distribution chosen from the natural conjugate

the economic performance of african american owned banks the role of loan loss provisions economists interest in african american banking institutions dates back to the early 1970 s when andrew brimmer cast a factual yet ominous shroud over the efficacy of african american banks as engines for growth in african american community economic development brimmer 1971 p 207 stated black banks are helpless as a vehicle to produce change in minority communities as a result of serious weaknesses in management capability in addition earlier studies noted that african american banks in particular face higher loan losses than their nonminority peers employ more conservative assetportfolio management strategies and operate with lower ratios of equity capital to assets brimmer 1971 john t boorman and myron l kwast 1974 timothy m bates and william d bradford 1980 kwast 1981 all of these practices inevitably work to reduce bank profitability and limit growth capability recent research by elyas elyasiani and seyed mehdian 1992 and iftekhar hasan and william c hunter 1996 compare the operating performance of minority and nonminority banks to a set of best practice banks that produce financial products and services at the lowest cost using the most efficient mix of productive inputs this paper builds upon this previous work on managerial inefficiency in minority banking institutions by identifying proximate causes of inefficiency due to the adverse socioeconomic conditions of urban areas where many minority owned banks are located these institutions are faced with risk and uncertainty unique to those par

mortgage lending in boston interpreting hmda data the home mortgage disclosure act was enacted to monitor minority and low income access to the mortgage market the data collected for this purpose show that minorities are more than twice as likely to be denied a mortgage as whites yet variables correlated with both race and creditworthiness were omitted from these data making any conclusion about race s role in mortgage lending impossible the federal reserve bank of boston collected additional variables important to the mortgage lending decision and found that race continued to play an important though significantly diminished role in the decision to grant a mortgage copyright 1996 by american economic association

assessing the effects of using demand parameters estimates in inventory control and improving the performance using a correction function inventory models need some specification of the distribution of demand in order to find the optimal order up to level or reorder point this distribution is unknown in real life and there are several solutions to overcome this problem one approach is to assume a distribution estimate its parameters and replace the unknown demand parameters by these estimates in the theoretically correct model earlier research suggests that this approach will lead to underperformance even if the true demand distribution is indeed the assumed one this paper directs the cause of the underperformance and quantifies it in case of normally distributed demand furthermore the formulae for the order up to levels are corrected analytically where possible and otherwise by use of simulation and linear regression simulation shows that these corrections improve the attained performance

business starters and credit rationing this paper investigates which business starters experience credit rationing by simultaneously analyzing which business founders apply for credit and which are refused we argue that credit denial depends largely on the entrepreneurs commitment and signals regarding the repayment of the loan and the success chances of the proposed business our empirical analysis is based on a sample of 1140 potential business starters in the dutch county south limburg our findings show that commitments drive the credit application and approval while the effects of signals are mixed the findings also suggest that business founders have a pretty good idea regarding whether their applications will be honored or not

ethnic matching in the u s venture capital market we document the role of entrepreneurial founder and venture capital vc partner co ethnicity in shaping investment relationships co ethnicity increases the likelihood that a vc firm invests in a company conditional on investment co ethnicity strengthens the degree of involvement by raising the likelihood of vc board of director involvement and increasing the size and scope of investment these results are consistent with trust and social network based mechanisms shared ethnicity in our sample is associated with worse investment outcomes as measured by investment liquidity however which our results suggest might stem from looser screening and or corporate governance

a model of redlining abstract we develop a model of mortgage redlining which captures the dynamic information gathering which is implied by the use of appraisals in mortgage granting in our model the precision of appraisals depends on the quantity of previous home sales in turn the precision of appraisals influences current home sales since when appraisals are inaccurate lenders require larger down payments there is thus a dynamic information externality in which past purchases influence current purchases as a consequence differential mortgage lending behavior will be sub optimal and the appearance of redlining may be justifiably subject to corrective action

a tri level optimization model for inventory control with uncertain demand and lead time abstract we propose an inventory control model for an uncapacitated warehouse in a manufacturing facility under demand and lead time uncertainty the objective is to make ordering decisions to minimize the total system cost we introduce a two stage tri level optimization model with a rolling horizon to address the uncertain demand and lead time regardless of their underlying distributions in addition an exact algorithm is designed to solve the model we compare this model in a case study with three decision making strategies optimistic moderate and pessimistic our computational results suggest that the performances of these models are either consistently inferior or highly sensitive to cost parameters such as holding cost and shortage cost whereas the new tri level optimization model almost always results in the lowest total cost in all parameter settings

gender roles and human capital inverstment the relationship between traditional attitudes and female labour market performance this paper investigates the relationship between the labour market behaviour of females and their attitudes towards traditional gender roles an attitudes index is constructed by employing individuals responses to statements related to the role of women and examined to determine whether it is correlated with individual characteristics the paper examines whether these attitudes influence human capital attainment and whether they are weakly exogenous to educational attainment it also focuses on the impact of these traditio nal attitudes upon labour supply and the return to education the results are dramatic it is found that females attitudes towards working women are developed in their youth and result in substantial reductions in their human capital investment labour supply and rates of return to education furthermore it is found that these attitudes are determined outside the educational process

evidence on discrimination in employment codes of color codes of gender there is substantial racial and gender disparity in the american economy as we will demonstrate discriminatory treatment within the labor market is a major cause of this inequality the evidence is ubiquitous careful research studies that estimate wage and employment regressions help wanted advertisements audit and correspondence studies and discrimination suits that are often reported by the news media yet there appear to have been periods of substantial reductions in economic disparity and discrimination for example donohue and heckman provide evidence that racial discrimination declined during 1965 1975 1 gottschalk has produced statistical estimates that indicate that discrimination against black males dropped most sharply between 1965 and 1975 and that discrimination against women declined during the interval 1973 1994 2 but some unanswered questions remain why did the movement toward racial equality stagnate and eventually decline after the mid 1970s what factors are most responsible for the remaining gender inequality what is the role of the competitive process in the elimination or reproduction of discrimination in employment

economies of scale and the demand for money cross sectional data from four surveys of small business finance demonstrate that economies of scale in money holding exist that these economies appear to be increasing over time and that the magnitudes are greater than those estimated for large us corporations firms not practising several specific cash management techniques and firms facing constraints in the credit market hold lower money balances minority owned firms exhibit economies of scale similar to the overall sample but cash management practices and credit constraint variables generally do not influence their money holding behavior scale economies vary widely across industries but overall means are relatively stable over time

a comparison of the optimal ordering levels of bayesian and non bayesian inventory models although it is often the case that the parameters of the distribution of demand are not known with certainty and that a bayesian formulation would be appropriate such an approach is generally not used in inventory calculations for computational reasons since one often resorts to a non bayesian formulation it is of interest to compare bayesian policies with a comparable non bayesian policy using the concept of flexibility it was anticipated that the quantity ordered under the non bayesian policy would be greater than or equal to that under a bayesian policy this result is established for the n period nondepletive inventory model however a two period counterexample is given for the standard depletive inventory model

the role of demographics in small business loan pricing demographic change influences the structure of the entrepreneurially active population which may affect credit risk and financing conditions of small firms using bank internal data of small business loans in germany we find that the lending relationship plays a larger role for loan prices than demographics loan rates decrease with soft information gained through longer loan processing time and a larger number of accounts at the same bank they increase with hard information about repayment arrears and reminders late payments have the largest influence on loan prices older entrepreneurs do not seem to be discriminated rather the younger have to pay more because their loans and businesses are smaller and they lack liquidity to pay in time marital status and population density of the business district do not matter this is good news for aging economies with a rising share of elderly and singles and growing disparities between peripheral and agglomerated regions

access to credit by small businesses how relevant are race ethnicity and gender this paper employs data from the 1998 and 2003 survey of small business finances to analyze whether after controlling for observable factors that influence loan decisions there is a significant difference in the loan approval rate and the interest rate charged on approved loans for businesses owned by minority or white females and firms owned by white males

minority entrepreneurship in twenty first century america prior to the 1970s minority owned small businesses were small in size and scope and common in only a few industry niches business owners were severely capital constrained lacking in higher education and training in skilled occupations the median owner today in contrast is college educated access to financing has expanded and opportunities to serve corporate and public sector clients are commonplace nearly 40 of all new firms created nationwide in 2015 were minority owned changing attitudes in mainstream society reduced traditional barriers true equality of opportunity among small minority and white owned firms of similar size and scope has nonetheless not been achieved this issue of small business economics examines lingering barriers impeding the development of a more vibrant minority business community focusing on access to financing and government procurement markets articles in this issue offer explicit analyses of enduring barriers along with explanations of adoptive strategic firm behavior appropriate for reducing those barriers

subjectivity in credit allocation to micro entrepreneurs evidence from brazil this paper estimates the impact of loan officer subjectivity on microcredit granting by exploiting an exceptionally detailed database from a brazilian microfinance institution the loan officers collect field data meet with applicants and make recommendations to the credit committee which has the final say on both loan approval and loan size ls the loan officer s subjectivity is captured through gender bias our estimations indeed show subjective gender gap in ls this gap is almost exclusively attributable to loan officers we interpret this finding as evidence that despite monitoring and wage incentivization microcredit officers let their subjective preferences interfere with loan granting we conclude by suggesting alternative means to curb subjectivity in credit allocation to micro entrepreneurs

racial and gender discrimination in the micro firms credit market evidence from trinidad and tobago this paper examines the market for loans from banks to micro and small enterprises in trinidad and tobago it tests for the presence of racial and gender discrimination it takes the reported refusal to grant loans to groups when all other indicators of credit worthiness are taken into account as evidence of discrimination the paper distinguishes between application and denial rates it finds that once all other indicators of credit worthiness are taken into account neither application nor denial rates differ significantly by gender reported denial rates are however higher for africans compared with other ethnic groups implying the possible presence of discrimination

gender bias and credit access we extract an exogenous measure of gender bias from survey responses by descendants of u s immigrants on questions about the role of women in society we then use data on around 6 000 small business firms from 17 countries and find that in high gender bias countries female entrepreneurs are more likely to opt out of the loan application process and to resort to informal finance even though banks do not appear to actively discriminate against them these results are not driven by credit risk differences between female and male owned firms or by any idiosyncrasies in the set of countries in our sample