a case study of organizational form and risk shifting in the savings and loan industry abstract i analyze the investment and funding strategies of two thrifts one stock owned and one mutually owned from 1983 to 1988 despite their similarities prior to 1983 the stock thrift implemented a riskier financial strategy and did so only after converting to stock ownership although this strategy ultimately led to its failure the stock thrift still made significant payouts to its controlling shareholders this case study illustrates in stark terms the relation between organizational form and risk shifting in the thrift industry

modern money theory and the facts of experience this paper discusses modern money theory mmt with a particular focus on the role of the state in its monetary system and the nature of money it addresses the main differences between the orthodox heterodox and mmt approaches to monetary theory while reconciling endogenous money theory with the state money approach by emphasising the symmetry between how banks create money as they finance private spending and how the government creates money when it finances its own spending we clarify some of the misconceptions surrounding mmt while showing that it is more consistent with the facts of experience furthermore we argue that mmt s insistence that government spending or lending must precede bond sales is consistent with the keynesian emphasis on effective demand as the driving force behind income and saving we delve into mmt s implications for monetary and fiscal policy with a particular focus on the eurozone we conclude our paper by discussing two proposals of monetary cranks narrow banking and government issue of debt free money this allows us to re emphasise mmt s views on the nature of money

consolidation in banking and the lending channel of monetary transmission evidence from asia and latin america abstract this paper examines the relationship between increased consolidation in banking and monetary policy transmission in eighteen asian and latin american economies using bank level data from 1996 to 2006 our results provide consistent evidence that as concentration in banking increases the bank lending channel is weakened leading the monetary policy transmission mechanism to be less effective we also investigate how this relationship between concentration and the strength of the lending channel depends on bank specific characteristics using bank level balance sheet and income statement data allows us first to better identify the effects of banking consolidation on the supply side bank lending channel from those of the demand side interest rate channel and second to test for any systematic differences in the impact of consolidation on monetary policy transmission across banks of different size and financial strength we also discuss potential explanations for and policy implications of the main findings of this paper

exporting does sales volume make a difference this research examines the effect that the size of a firm has on export activities perceived problems in exporting and attitudes toward exporting the results indicate that broad generalizations concerning the size of firms and exporting appear to be inappropriate

minimum price variations discrete bid ask spreads and quotation sizes exchange minimum price variation regulations create discrete bid ask spreads if the minimum quotable spread exceeds the spread that otherwise would be quoted spreads will be wide and the number of shares offered at the bid and ask may be large a cross sectional discrete spread model is estimated by using intraday stock quotation spread frequencies the results are used to project 1 16 spread usage frequencies given a 1 16 tick projected changes in quotation sizes and in trade volumes are obtained from regression models for stocks priced under 10 the models predict spreads would decrease 38 percent quotation sizes would decrease 16 percent and daily volume would increase 34 percent article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

collective moral hazard maturity mismatch and systemic bailouts the paper elicits a mechanism by which private leverage choices exhibit strategic complementarities through the reaction of monetary policy when everyone engages in maturity transformation authorities haver little choice but facilitating refinancing in turn refusing to adopt a risky balance sheet lowers the return on equity the key ingredient is that monetary policy is non targeted the ex post benefits from a monetary bailout accrue in proportion to the number amount of leverage while the distortion costs are to a large extent fixed this insight has important consequences first banks choose to correlate their risk exposures second private borrowers may deliberately choose to increase their interest rate sensitivity following bad news about future needs for liquidity third optimal monetary policy is time inconsistent fourth macro prudential supervision is called for we characterize the optimal regulation which takes the form of a minimum liquidity requirement coupled with monitoring of the quality of liquid assets we establish the robustness of our insights when the set of

the relationship between firm size and export behavior revisited many academic studies and government leaders are asking small and medium sized firms to become more involved in exports unfortunately the role that can be played by smaller firms is unclear despite the vast number of studies on size and export behavior discrepancies in study findings and the absence of variance statistics prevent researchers from understanding the importance of size this study has sought to examine the direct and indirect effects of firm size by examining three dimensions of export behavior propensity of export countries exporting to and export attitudes for 14 072 canadian manufacturers the results indicate that while firm size is positively related to all dimensions of export behavior its importance is limited as the amount of variance explained is modest

the impact of trading floor closure on market efficiency evidence from the toronto stock exchange we are the first to evaluate the impact of the trading floor closure on the corresponding efficiency of the stock price formation process on the toronto stock exchange tsx utilizing short horizon return predictability as an inverse indicator of market efficiency we demonstrate that while the switch to all electronic trading resulted in higher volume and lower trading costs the information asymmetry among investors increased as more informed and uninformed traders entered the market the tsx trading floor closure resulted in a significant decrease in informational efficiency and it took about six years for efficiency to return to its pre all electronic trading level in multivariate setting we provide evidence that changes in information asymmetry and increased losses to liquidity demanders due to adverse selection account for the largest variations in the deterioration of the aggregate level of informational efficiency our results suggest that electronic trading should complement rather than replace the exchange trading floor

on the relationship between firm size and export intensity export marketing literature supports the view that firm size is positively related to export intensity although the empirical findings have been mixed a number of theoretical arguments are used to support this proposition i e international marketing economies of scale limited managerial and financial resources of small firms decisionmaker s risk perception based on a large survey of the italian manufacturing industry the article falsifies the proposition and challenges some widely held assumptions in export marketing literature

monetary policy and stagflation in the uk the volatile behavior of inflation output and interest rates in the united kingdom prior to the 1990s helps discriminate between rival explanations for the outbreak of stagflation we examine alternative hypotheses with a new keynesian model of aggregate demand and inflation determination estimated on quarterly uk data for 1959 2000 our model features is and phillips curves based on optimizing behavior and fully incorporates the distinction between detrended output and the output gap stressed by optimizing analysis using simulations of our model as well as information on the real time views of policymakers we test alternative explanations for the outbreak of inflation in the united kingdom in the 1960s and 1970s we find that inaccurate estimates of the degree of excess demand in the economy contributed significantly to the outbreak but we also find a major role for the failure at the time to recognize the importance of monetary policy as opposed to nonmonetary devices in controlling inflation

tick size share prices and stock splits minimum price variation rules help explain why stock prices vary substantially across countries and other curiosities of share prices companies tend to split their stock so that the institutionally mandated minimum tick size is optimal relative to the stock price a large relative tick size provides an incentive for dealers to make markets and for investors to provide liquidity by placing limit orders despite its placing a high floor on the quoted bid ask spread a simple model suggests that idiosyncratic risk firm size and visibility of the firm affect the optimal relative tick size and thus the share price in stock markets around the world the average price per share differs substantially the median u s stock for example sells for about 40 a typical london stock sells for about 5 7 50 and a typical hong kong share is about 2 furthermore when stock prices rise above a country s usual trading range firms often split their stocks to restore prices to that range why are these price ranges so different among countries these trading ranges can be remarkably stable over time during the half century from 1943 to 1994 the s p composite index increased over 1 500 percent yet the average new york stock exchange nyse share price was

information sources for new ventures in the turkish clothing export industry recently born global firms have received considerable attention in the entrepreneurship and international business literature managers leading these new ventures typically face substantial resource constraints when seeking information critical to internationalization this paper examines how the owner operators of new ventures in the turkish clothing export industry utilize their informal and formal social networks to acquire the information they need to export successfully field research and a survey of 250 turkish clothing firm owners was conducted in istanbul turkey to explore this issue findings indicate that informal social ties particularly friends and family connections are key sources of information for new venture firm owners in this industry two formal organizations provide export information to entrepreneurs in the turkish clothing industry but only one was found to be easily accessible to new venture firm owners the istanbul textile and clothing exporters union itkib ols regression results reveal that new venture firm owners perceptions of itkib s importance can be explained by their perceived importance of various kinds of export oriented information offered by this organization in particular perceived importance of export law market research and export process information drive their perceptions of the importance of their itkib membership

full reserve banking more cranks than brave heretics this paper analyses the main features and policy implications of full reserve banking frb proposals it argues that whilst frb advocates recognize the essential endogeneity of the money creation process they have failed to understand the post keynesian and monetary circuitist analyses of endogenous money which leads them to analytical errors including lending activity creates seigniorage privilege for commercial banks inflation is always and everywhere a monetary phenomenon the inability of distinguishing the actual from the planned supply of bank loans and money to be spent from money hoarded and the debt free money proposition the paper also argues that an frb system is likely to exacerbate financial instability for several reasons including the obsessive focus on commercial banks while ignoring non bank financial intermediaries and shadow banking a blind fascination for the safety and security of the payment system with little consideration for the financing needs of capitalist economies and an inherent deflationary bias furthermore frb arrangements would soon be undermined by the development of alternative near moneys finally frb will nullify the automatic stabilisers of fiscal policy and lead to a de facto dominance of monetary policy and unelected central bankers over fiscal policy and democratic decision making

keynesian and monetarist theories of the monetary transmission process doctrinal aspects abstract this paper investigates the doctrinal link underlying differences between keynesian and monetarist approaches regarding the transmission mechanism of monetary policy consideration of the post general theory literature reveals that a key aspect of that link concerns the velocity of circulation of money the keynesian emphasis on compartmentalizing the demand for money into active and idle components resulted in a mechanical interpretation of velocity and the associated view that money does not matter the monetarist tradition illustrates the behavioral perspective adduced to velocity via adaptive price expectations by earlier quantity theorists leading to a capital theoretic reformulation of the quantity theory in terms of a stable demand function for money

the role of the gold standard in keynesian monetary theory i introduction the primary motivation for this paper was provided by ambiguities within the general theory regarding the efficacy of monetary policy remedies to a depression i will argue that rather than being a fixed price or depression model the general theory is best thought of as a gold standard model thus i show that keynes s statements on monetary policy ineffectiveness implicitly assumed the existence of a monetary system with some linkage to gold and that some of the general theory s most distinctive features make more sense if viewed from that perspective this hypothesis may appear surprising in light of the popular perception that in the general theory keynes tried to move away from the open economy international gold standard framework employed in the treatise on money i will argue that he failed to do this even if keynes did not explicitly regard the general theory as a gold standard model during the 1930s he began to view the economic problems that we associate with the gold standard monetary policy ineffectiveness occasional episodes of deflation and so on as being inherently characteristic of a modern capitalist economy ironically keynes made this change just as many countries were beginning to deemphasize the role of gold keynes is regarded as one of the most severe critics of an international gold standard with rigid parities thus it is odd that he would develop a monetary ineffectiveness proposition that has little or no applicability to a country operating under a fiat money regime an essential part of my argument will be to show that keynes viewed a pure fiat regime as being both highly unlikely and highly undesirable an important implication of this paper is that the gradual replacement of the gold standard by fiat money regimes should have led modern keynesian economists to move away from some of the most distinctive features of 1930s keynesianism such as monetary policy ineffectiveness deficit spending the paradox of thrift and protectionism i will show that the recent metamorphosis of new keynesian macroeconomics represents a natural response of economists to a radically altered monetary environment ii keynes s views on monetary policy to better understand the role played by the gold standard in keynes s work it will be helpful to start with the monetary ineffectiveness proposition in current usage this phrase generally refers to the new classical view that money has no impact on real output in contrast most would interpret the pessimistic views expressed by keynes during the 1930s as reflecting a belief that monetary expansion might be incapable of increasing nominal output because keynes clearly did not believe that an expansionary monetary policy would reduce real output this interpretation suggests that keynes viewed the ineffectiveness proposition as also applying to the price level unfortunately there is great uncertainty as to how pessimistic keynes actually was regarding the effectiveness of monetary policy the 31 december 1933 issue of the new york times times p 2xx published a long letter by keynes in which he evaluated the first year of the new deal after a lengthy critique of the national recovery act keynes turned his attention to roosevelt s gold buying program 1 the other set of fallacies arises out of a crude economic doctrine commonly known as the quantity theory of money rising output and rising incomes will suffer a setback sooner or later if the quantity of money is rigidly fixed some people seem to infer from this that output and income can be raised by increasing the quantity of money but this is like trying to get fat by buying a larger belt this is a clear example of what is often referred to as the pushing on a string view of monetary policy ineffectiveness but notice how keynes subtly shifts his argument in the very next paragraph as he turns from money s effect on real output to its effect on prices it is an even more foolish application of the same ideas to believe that there is a mathematical relation between the price of gold and the price of other things

competition in banking and the lending channel evidence from bank level data in asia and latin america abstract this paper examines how banking competition affects the transmission of monetary policy through the bank lending channel we apply a two step estimation procedure using bank level panel data for commercial banks in 10 asian and 10 latin american countries during the period from 1996 to 2006 in the first step we measure the degree of banking competition by applying the methodology proposed by panzar and rosse 1987 in the second step we estimate a loan growth equation where the explanatory variables include the panzar rosse measure of banking competition the estimation results provide consistent evidence that increased competition in the banking sector weakens the transmission of monetary policy through the bank lending channel this is especially true for banks in latin american countries and banks of small size low liquidity and low capitalization we also discuss the policy implications of the main findings of this paper

a response to critiques of full reserve banking in this response to critiques of full reserve banking or sovereign money proposals we challenge four of the main criticisms made by fontana and sawyer this issue i the impact of the proposal on government finances and fiscal policy ii the impact of the proposal on the supply of credit to the real economy iii the danger of private money creation re emerging in the shadow banking sector and iv the argument that shadow banking not commercial banking is the real source of financial instability

state government promotion of manufacturing exports a gap analysis this study empirically examines the level of the export related expertise of manufacturing firms in a midwestern state of the united states various problems they face in export business and types of government assistance desired by their stage of export involvement it also investigates the appropriateness of government export assistance and the gap between governmental export promotion efforts and private sector needs it is shown that the identification of expertise problems and government assistance needs by export stage can help government agencies develop a systematic approach to export promotion

does bank ownership affect lending behavior evidence from the euro area abstract we analyze the differences in lending policies across banks characterized by different types of ownership using micro level data on euro area banks during the period 1999 2011 to detect possible variations in bank lending supply responses to changes in monetary policy our results identify a general difference between stakeholder and shareholder banks following a monetary policy contraction stakeholder banks decrease their loan supply to a lesser extent than shareholder banks a detailed analysis of the effect among stakeholder banks reveals that cooperative banks continued to smooth the impact of tighter monetary policy on their lending during the crisis period 2008 2011 whereas savings banks did not stakeholder banks propensity to smooth their lending cycles suggests that their presence in the economy has the potential to reduce credit supply volatility

an empirical investigation of the factors influencing exporting success of brazilian firms one hundred and fifty two brazilian companies that were exporting in 1978 were interviewed again six years later in 1984 to determine the factors that were correlated with the continuance of exporting firm characteristics export management practices and manager perceptions were each found to be correlated with exporting success thus supporting the basic contention that it is possible to predict export performance firms that discontinued exporting relied more on the brazilian government export incentives possibly to be competitive in international markets without making the necessary structural changes thereby raising important questions about the long run impact of the brazilian export programs

common factors underlying barriers to export studies in the u s paper industry this paper identifies five factors that cluster belief about the importance of barriers to export held by executives in strategic business units involved in export of paper products or contemplating such export these factors were evaluated in respect to the international business literature and labeled as national export policy comparative marketing distance lack of export commitment exogenous economic constraints and competitive rivalry this analysis revealed a minor appreciation of the importance of competitive rivalry and a high appreciation of the barrier provided by exogenous economic constraints the other three factors assumed intermediate positions of importance among the five factors

eighths sixteenths and market depth changes in tick size and liquidity provision on the nyse using limit order data provided by the nyse we investigate the impact of reducing the minimum tick size on the liquidity of the market while both spreads and depths quoted and on the limit order book declined after the nyse s change from eighths to sixteenths depth declined throughout the entire limit order book as well the combined e ect of smaller spreads and reduced cumulative limit order book depth has made liquidity demanders trading small orders better o however traders who submitted

u k and u s trading of british cross listed stocks an intraday analysis of market integration this article analyzes intraday patterns for u k and u s trading of british cross listed stocks for each market the intraday patterns for these stocks closely resemble those of otherwise similar non cross listed stocks there is a 2 hour period each day when cross listed stocks are traded both in new york and in london this overlap is characterized by concentrated trading as private information originating in new york gets incorporated into prices in both markets cross border competition for order flow tends to reduce already declining spreads in london by contrast new york specialists maintain high spreads during the overlap overall the evidence indicates that order flow for cross listed securities is segmented article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

financial system architecture this article builds a theory of financial system architecture we ask what is a financial market what is a bank and what determines the economic role of each starting with basic assumptions about primitives the types of agents and the nature of the informational asymmetries we provide a theory that explains which agents coalesce to form banks and which trade in the capital market it is shown that borrowers of higher observable qualities access the financial market moreover a financial system in its infancy will be bank dominated and increased financial market sophistication diminishes bank lending article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

interest rates and bank risk taking abstract a recent line of research views the low interest rate environment of the early to mid 2000s as an element that triggered increased risk taking appetite of banks in search for yield this paper uses approximately 18000 annual observations on euro area banks over the period 2001 2008 and presents strong empirical evidence that low interest rates indeed increase bank risk taking substantially this result is robust across a number of different specifications that account inter alia for the potential endogeneity of interest rates and or the dynamics of bank risk notably among the banks of the large euro area countries this effect is less pronounced for french institutions which held on average a relatively low level of risk assets finally the distributional effects of interest rates on bank risk taking due to individual bank characteristics reveal that the impact of interest rates on risk assets is diminished for banks with higher equity capital and is amplified for banks with higher off balance sheet items

the export development process an integrative review of empirical models despite widespread research on the export behavior of firms no integrative review of the empirical work in relation to export development models exists in the extant literature this article reviews the main models on the subject identifies their structural characteristics evaluates the methodologies used for their validation and analyzes the key conceptual issues emerging from their assessment while valuable inroads into the mechanics and constituent parts of the export development process have been made this avenue of empirical inquiry has attracted criticism on structural methodological and conceptual grounds future research in the field should harness the eclectic contribution afforded by existing theory and at the same time enhance its status with contributions from marketing business and other disciplines

the political economy of monetary reform proposals to reform money and banking in the wake of the recent crisis appeal to populist politics on the left and the right if banks caused the crisis then their power must be curtailed to prevent a recurrence many of these proposals echo ideas which gained attention in the wake of the great depression the purpose of this paper is to consider proposals for reform of money and banking current in canada in the 1930s in particular plans for social credit and for social reconstruction some of which were translated into policy while both sets of ideas involved a markedly increased role for the state in money and banking the underlying ontology political philosophy and theoretical rationale were rather different the result was different views as to the nature of the problem and the feasibility of different policy solutions

firm differences in perceptions of the facilitating role of foreign trade zones in global marketing and logistics recent research has investigated the internationalization process of the firm this study provides insight into the role that foreign trade zones play in that process it investigates differences between users and non users of foreign trade zones in terms of 1 firm characteristics 2 the awareness of zone benefits and 3 the importance of the benefits to the firms surveyed zone users were found to import significantly more than non users and exported more as well users tended to be smaller in size sales and number of employees than non users users were more aware of the benefits of foreign trade zones and for the most part rated the benefits as being more important in facilitating their global marketing and logistics functions

cross border listings and price discovery evidence from u s listed canadian stocks we examine the contribution of cross listings to price discovery for a sample of canadian stocks listed on both the toronto stock exchange tse and a u s exchange we nd that priceson the tse and u s exchange are cointegrated and mutually adjusting the u s share of price discovery ranges from 0 2 percent to 98 2 percent with an average of 38 1 percent the u s share is directly related to the u s share of trading and to the ratio of proportions of informative tradeson the u s exchange and the tse and inversely related to the ratio of bid ask spreads with the enhanced globalization of nancial markets the number of non u s rms cross listing shares on a u s exchange has substantially increased attracting non u s listings is now a top priority of the u s stock exchanges at the end of 2000 420 non u s rmswere listed on the new york stock exchange nyse the number of foreign rmslisted on nasdaq waseven higher the popularity of international cross listings has prompted many academic studies on the topic 1 most of these studies focus on the bene ts of international cross listings including the reduced cost of capital and the enhanced liquidity of a rm s stock studiessuch asalexander eun and janakiramanan 1987 1988 and foerster and karolyi 1993 suggest that the cost of capital declines because the portion of the risk premium that compensates for cross border investment barriers dissipates miller 1999 and foerster and karolyi 1999 propose increased investor recognition as another possible explanation several studies examine changes in trading volume and costs due to international cross listing foerster and karolyi 1998 nd that the bid ask spreads in canada decrease after the cross listing of canadian stocks in the united states domowitz glen and madhavan 1998 suggest that the impact of cross listing is complex and depends on the degree of quote transparency that is the extent to which price information is observable in the two markets smith and so anos 1997 examine if cross listing is a zerosum game with increased trading in the united states being oiset by reduced

doctrinal foundations of monetary economics abstract in the realm of monetary economics both national and international expositions of doctrinal history have been hard to come by as laidler 1982 p 326 has observed historians of economic thought habitually neglect monetary economics when they write their textbooks recently however three publications have appeared that cast a historical perspective on the development of monetary thought jurg niehans s a history of economic theory classic contributions 1720 1980 johns hopkins university press baltimore md 1990 don patinkin s money interest and prices second edition abridged mit press cambridge ma 1989 and m june flanders s international monetary economics 1870 1960 between the classical and the new classical cambridge university press cambridge u k 1989

foreign banks trends and impact over the past two decades foreign banks have become much more important in domestic financial intermediation heightening the need to understand their behavior we introduce a new comprehensive database made publicly available on bank ownership including the home country of foreign banks for 5 324 banks in 137 countries over the period 1995 2009 we document large increases in foreign bank presence in many countries but with substantial heterogeneity in terms of host and banks home countries bilateral investment patterns and bank characteristics in terms of impact we document that the relation between private credit and foreign bank presence importantly depends on host country and banks characteristics specifically foreign banks only seem to have a negative impact on credit in low income countries in countries where they have a limited market share where enforcing contracts is costly and where credit information is limited available and when they come from distant home countries this shows that accounting for heterogeneity including bilateral ownership is crucial to better understand the implications of foreign bank ownership

real interest rates leverage and bank risk taking do low interest rate environments lead to greater bank risk taking we show that when banks can adjust their capital structures reductions in real interest rates lead to greater leverage and higher risk for any downward sloping loan demand function however if the capital structure is fixed the effect depends on the degree of leverage following a decrease in interest rates well capitalized banks increase risk while highly levered banks may decrease it if loan demand is linear or concave further the capitalization cutoff depends on the degree of bank competition this effect therefore should vary across countries and over time

a reexamination of mean variance analysis of bank capital regulation abstract the mean variance framework has been used to analyze the effects of bank capital regulation on the asset and bankruptcy risk of insured utility maximizing banks this literature claims that more stringent capital regulation will increase asset risk and can increase bankruptcy risk these conclusions are notable because they are opposite to those obtained for insured value maximizing banks in this paper we show that the utility maximization literature does not support its conclusions regarding the effects of bank capital regulation because it has mischaracterized the bank s investment opportunity set by neglecting the option value of deposit insurance

evaluating export promotion programmes uk overseas trade missions and export performance this paper examines the extent to which firms knowledge and structural characteristics as well as firms behaviour in foreign markets following trade mission participation impacts upon trade mission success and export performance the findings suggest that 1 a diversification strategy in terms of export markets benefits future expansion into new foreign markets 2 specific knowledge about the targeted markets should be acquired prior to participating in the trade missions 3 communication with potential business partners should be established prior to participating in the trade missions and 4 the business relationships established before and during the trade missions should be cultivated through regular contacts using not only communication technology but also regular visits in summary overseas trade missions contribute to the generation of incremental sales in foreign markets by enhancing the relationship building process between business partners

was the monetarist tradition invented in 1969 harry johnson charged that milton friedman invented a chicago oral quantity theory tradition the idea being that in order to launch a monetarist counter revolution friedman needed to establish a linkage with pre keynesian orthodoxy this paper shows that there was a distinct pre keynesian chicago quantity theory tradition that advocated increased government expenditure during the great depression in order to put money directly into circulation this policy stance distinguished the chicago economists from other quantity theorists leaving them less susceptible to the keynesian revolution those who have been critical of friedman s claim that his work derives from the earlier chicago tradition have focused exclusively on friedman s long run empirical specification of money demand friedman s cyclical analysis is shown to be very much in the chicago tradition other connections between friedman s views and the chicago tradition are also discussed

bank ownership and lending patterns during the 2008 2009 financial crisis evidence from latin america and eastern europe this paper examines the impact of bank ownership on credit growth in developing countries before and during the 2008 2009 crisis using bank level data for countries in eastern europe and latin america it analyzes the growth of banks total gross loans as well as the growth of corporate consumer and residential mortgage loans although domestic private banks in eastern europe and latin america contracted their loan growth rates during the crisis there are differences in foreign and government owned bank credit growth across regions in eastern europe foreign bank total lending fell by more than domestic private bank credit these results are primarily driven by reductions in corporate loans furthermore government owned banks in eastern europe did not act counter cyclically the opposite was true in latin america where the growth of government owned banks corporate and consumer loans during the crisis exceeded that of domestic and foreign banks contrary to the case of foreign banks in eastern europe those in latin america did not fuel loan growth prior to the crisis and did not contract lending at a faster pace than domestic banks during the crisis

exporting does sales volume make a difference comment this paper examines a recent investigation of the relationship between firm size and exporting it illustrates how and why neglect of critical conceptual and methodological issues continues to confound research on the impact that firm size has on exporting

the competitive effects of us decimalization evidence from the us listed canadian stocks abstract this paper analyzes the impact of us decimalization on the canadian stocks listed on the toronto stock exchange tse and either the new york stock exchange nyse or national association of securities dealers automated quotation system nasdaq in the us using a sample of 126 firms we find that the us trading of these stocks increases after decimalization but this increase is not at the expense of tse volume indeed the tse volume increases substantially for those securities that are traded on nasdaq and increases marginally for those securities that are traded on the nyse most of the increase in volume is in retail sized trades the bid ask spreads and the quote depths decline on all exchanges but by a greater amount in the us than in canada the depths on the nyse decline from being above the tse depths to well below the tse depths we also find that the decline in the tse spread is directly related to the size of the firm and to the decline in the us spread and is inversely related to the pre decimalization ratio of spreads on the us exchange and the tse overall our results indicate that the us decimalization had the desired positive impact on trading in both the us and canada with a decrease in spreads and an increase in retail sized trading

in old chicago simons friedman and the development of monetary policy rules this paper examines the different policy rules proposed by henry simons who beginning in the mid 1930s advocated a price level stabilization rule and by milton friedman who beginning in the late 1950s advocated a rule that targeted a constant growth rate of the money supply although both rules shared the objective of eliminating the policy uncertainty emanating from discretion they differed because of the different views of simons and friedman about the stability of secular relationships simons rule relates to modern rules that emphasize the pursuit of price stability as representing optimal monetary policy

stock versus mutual ownership structures the risk implications this article provides empirical tests of the risk differences between two types of ownership structure in the property liability insurance industry empirical evidence is provided that suggests stock insurers have more risk than mutuals where the risk inherent in future cash flows is proxied by the variance of the loss ratio further evidence suggests that stock insurers write relatively more business than do mutuals in lines and states having higher risk copyright 1993 by university of chicago press

the impact of bank capital on profitability and risk in asian banking abstract this article applies the generalized method of moments technique for dynamic panels using bank level data for 42 asian countries over the period 1994 to 2008 to investigate the impacts of bank capital on profitability and risk ignoring influence factors the extant literature presents an ambiguous impact of bank capital on profitability risk however when the effects from the influencing factors are taken into consideration three conclusions are reached first along with the change in the categories of banks investment banks have the lowest and positive capital effect on profitability whereas commercial banks reveal the highest reverse capital effect on risk second banks in low income countries have a higher capital effect on profitability banks in lower middle income countries have the highest reverse capital effect on risk while banks in high income countries have the lowest values third banks in middle eastern countries own the highest and positive capital effect on profitability far east central asian banks have the largest reverse capital effect on risk while the lowest value occurs in middle eastern countries banks finally our results also reveal that persistence of profit is greatly affected by different profitability variables and all risk variables show persistence from one year to the next