detecting abnormal credit union performance abstract credit unions are an important financial intermediary but little credit union research is done a primary reason for the lack of research is the cooperative nature of the industry making traditional methods of detecting abnormal performance inappropriate this paper proposes two methods of detecting abnormal performance one parametric the other non parametric instead of testing the efficiency of the institution this paper proposes testing the return vector as indicated in the theoretical objective function of the member simulations demonstrate that both methods are correctly specified and powerful

energy regulation in china objective selection potential assessment and responsibility sharing by partial frontier analysis to cope with the excessive growth of energy consumption the chinese government has been trying to strengthen the energy regulation system by introducing new initiatives that aim at controlling the total amount of energy consumption a partial frontier analysis is performed in this paper to make a comparative assessment of the combinations of possible energy conservation objectives new constraints and regulation strategies according to the characteristics of the coordination of existing regulation structure and the optimality of regulation strategy four scenarios are constructed and regional responsibilities are reasonably divided by fully considering the production technology in the economy the relative importance of output objectives and the total amount controlling is compared and the impacts on the regional economy caused by the changes of regulation strategy are also evaluated for updating regulation policy

non radial cost luenberger productivity indicator abstract this study decomposes cost inefficiency into technical and allocative components in a more general way based on the directional russell measure drm of fukuyama and weber 2009 with the allocative component being completely clear of technical inefficiency based on this decomposition we develop a cost oriented productivity indicator the cost luenberger productivity indicator cl which completely embraces the concept of cost minimization and provides four sources of productivity change technical efficiency change the change in allocative efficiency the shift of technology and the effect of input price change to illustrate the above decompositions of cost inefficiency and productivity change and to investigate whether the establishment of a financial holding company fhc offers a bank greater operating efficiency and an improvement in productivity change this study employs data on taiwan s banking industry covering the period 2006 2012

impacts of climate change on self sufficiency of rice in china a cge model based evidence with alternative regional feedback mechanisms abstract climate change would pose a direct and severe challenge to china s rice production and self sufficiency here we use global trade analysis project gtap model to evaluate the impacts of climate change on the self sufficiency of rice in china due to 2 c rise in temperature and further analyze the impact and transmission mechanisms of climate change through market and trade our simulation method switches different regional mechanisms in the gtap model by employing alternative closures and scenarios our results suggest that the fluctuation in rice price is much larger than that of rice production the active regional feedback mechanism has much larger effects than the passive one in assessing climate change impacts with the passive regional feedback mechanism single regional general equilibrium srge and multi regional general equilibrium with china s shock mrge c china s rice export would decrease by more than 8 and import would increase by over 5 which leads to a decrease in rice self sufficiency by more than 0 06 percentage points with the active regional feedback mechanism multi regional general equilibrium with global shock mrge w climate change will increase china s rice export by 2 7 as rising rice exports to south korea overweight the export decrease to other countries concurrently china s rice import would decrease by 0 04 which leads to a slight increase in rice self sufficiency as a whole climate change will not severely threaten china s rice self sufficiency by the decomposition analysis climate change impacts on china s rice self sufficiency mainly depend on the changes in china s domestic rice production interestingly the source of china s rice import will switch from vietnam to pakistan under mrge w which derives from the input structure of paddy rice and rice sectors in different countries

the eu budget battle assessing the trade and welfare impacts of cap budgetary reform abstract there is a paucity of quantitative impact assessments of the sectorial and macroeconomic impacts of cap budget reform for eu member states to fill this gap the current study employs a sophisticated agricultural variant of the gtap model to evaluate the recently agreed cap spending limits for the financial period 2014 2020 as well as a more radical 50 cut to the cap budget proposed by the uk government the study incorporates methodological innovation in terms of the modelling of cap budgetary mechanisms furthermore official eu auditing statistics are employed to i greatly improve the existing representation of agricultural support payments in the gtap benchmark data and ii implement a detailed contemporary cap baseline for member states to capture both the decoupled coupled split of support payments and the distribution of support across both pillars in general cap expenditure cuts have muted impacts on eu and world agricultural markets whereas changes in net transfer payments have implications for real income and macro trade balances in eu member states this observation is particularly pertinent when assessing conciliatory reductions in the uk rebate in exchange for deeper cap budget cuts

the evolution of cost productivity and efficiency among us credit unions abstract advances in information processing technology have eroded the advantages of small scale and proximity to customers that traditionally enabled small lenders to thrive nonetheless the membership and market share of us credit unions have increased though their average size has also risen we investigate changes in the efficiency and productivity of us credit unions during 1989 2006 by benchmarking the performance of individual firms against an estimated order quantile lying near the efficient frontier we construct a cost analog of the malmquist productivity index which we decompose to estimate changes in cost and scale efficiency and changes in technology we find that cost productivity fell on average across all credit unions but especially among smaller credit unions smaller credit unions confronted a shift in technology that increased the minimum cost required to produce given amounts of output all but the largest credit unions also became less scale efficient over time

are credit unions too small abstract u s credit unions serve 93 million members hold 10 of u s savings deposits and make 13 2 of all nonrevolving consumer loans since 1985 the share of u s depository institution asse

an economic theory of a credit union the majority of research to date on cus has been empirical cf cargill 1 and kidwell and peterson 7 yet there is serious need to develop a theoretical framework of cu behavior that incorporates their unique characteristics a cu is essentially a financial intermediation cooperative however the standard theoretical treatments of financial intermediaries cf meyer 8 and cooperative enterprises cannot be directly applied to model credit union behavior there are two principal characteristics of cus that prevent this first in a cu and cooperatives in general the members are both the owners of the organization and the consumers of its output or suppliers of its input one cannot simply assume that the members seek to maximize the profit generated by their transactions with the cu irrespective of the price and quantities of those same transactions thus models of a financial firm based on profit maximization cannot be directly translated to a cu environment second in a cu the membership provides both the demand for and supply of loanable funds the cu then intermediates between its member savers and member borrowers this heterogeneity is an inherent source of conflict between members clearly a cu cannot simultaneously maximize its dividend rate for savers and minimize its loan rate for borrowers since most theoretical models of cooperative enterprises assume a homogeneous member objective they are not generally applicable to cus there are two basic requirements for a framework to model cu behavior first the specification of the objective function should focus on the value of cu participation to the members this value should include the prices and quantities of transactions as well as any profit that results second the analysis should explicitly consider the possibility of conflict among members and the resolution of that conflict being a preference to either the borrowers or savers the existing literature on cus contains a wide variety of objective functions hempel and yawitz 5 ignore the owners are consumers issue and simply contend that cus like other financial intermediaries should maximize profit most writers however recognize that profit maximization would be a somewhat incongruous objective for an organization that typically labels itself not for profit murray and white 9 use cost minimization subject to an output constraint keating 6 employs the managerial discretion approach by maximizing the manager s utility function subject to minimum member benefit constraints taylor 11 12 suggests that the cu should minimize the difference between its average loan rate and savings rate paid smith 10 argues that the cu should

collusion and price rigidity we consider an in nitely repeated bertrand game in which prices are publicly observed and each rm receives a privately observed i i d cost shock in each period we focus on symmetric perfect public equilibria sppe wherein any punishments are borne equally by all rms we identify a tradeoff that is associated with collusive pricing schemes in which the price to be charged by each rm is strictly increasing in its cost level such fully sorting schemes offer efficiency bene ts as they ensure that the lowest cost rm makes the current sale but they also imply an informational cost distorted pricing and or equilibrium path price wars since a higher cost rm must be deterred from mimicking a lower cost rm by charging a lower price a rigid pricing scheme where a rm s collusive price is independent of its current cost position sacri ces efficiency bene ts but also diminishes the informational cost for a wide range of settings the optimal symmetric collusive scheme requires i the absence of equilibrium path price wars and ii a rigid price if rms are sufficiently impatient however the rigid pricing scheme cannot be enforced and the collusive price of lower cost rms may be distorted downward in order to diminish the incentive to cheat when the model is modi ed to include i i d public demand shocks the downward pricing distortion that accompanies a rm s lower cost realization may occur only when current demand is high

dynamics of asymmetric conflict the case of the german milk conflict the german milk conflict developed when an emerging farmer association challenged the large incumbent in the wake of an insufficiently communicated policy change abolition of the milk quota the organizations represent opposing sides of a common policy debate market liberalization versus regulation the study analyzed the patterns between the two organizations and proposed a grounded theory of asymmetric conflict due to the elevated level of emotions during the conflict the study used a qualitative research approach based on 34 in depth interviews the analysis uncovered the interlocking patterns of simplification and emotionalization by the smaller association and rationalizing by the larger association results indicate how an active opponent can use policy changes to its advantage and how to prevent such a development recommendations based on the grounded theory developed such as implementing suitable communication strategies are transferable to a variety of changes and conflict situations in complex environments such as the food and agricultural sector

a theoretic framework for the analysis of credit union decision making this paper presents a formal theoretic framework to analyze credit union interest rates on loans and savings deposits the unique motivational and institutional features of a credit union in particular its structure as a financial service cooperative are used to develop the objective function this is based on a comparison of the credit union s rates to alternatively available market rates and includes parameters to recognize the possibility of borrower saver conflict the principal result is that the optimal rates and reactions to exogenous changes depend critically on the preference of the organization toward financial gain to the borrowing and saving members

the growth of us credit unions abstract the growth of us credit unions during the 1990s is investigated empirically using univariate and multivariate cross sectional and panel estimation techniques univariate tests of the law of proportionate effect suggest that in general large credit unions grew faster than their smaller counterparts on average credit unions with above average growth in one period tended to experience below average growth in the next smaller credit unions tended to have more variable growth than large ones while credit unions share a common co operative philosophy they differ in terms of age profile scope for membership growth charter type and financial structure and performance in estimations of a multivariate growth model most of these characteristics are found to have a significant influence on the size growth relationship while large state chartered credit unions grew faster than their smaller counterparts the reverse was true for federally chartered credit unions in general if larger credit unions grew faster than smaller ones they tended to do so for specific reasons because their charters were less restrictive because they were more efficient or because they had a financial structure that was more conducive to growth therefore credit union growth was not random but highly systematic

the diversification and financial performance of us credit unions abstract for us credit unions revenue from non interest sources has increased significantly in recent years we investigate the impact of revenue diversification on financial performance for the period 1993 2004 the impact of a change in strategy that alters the share of non interest income is decomposed into a direct exposure effect reflecting the difference between interest and non interest bearing activities and an indirect exposure effect which reflects the effect of the institution s own degree of diversification on both risk adjusted and unadjusted returns measures a positive direct exposure effect is outweighed by a negative indirect exposure effect for all but the largest credit unions this may imply that similar diversification strategies are not appropriate for large and small credit unions small credit unions should eschew diversification and continue to operate as simple savings and loan institutions while large credit unions should be encouraged to exploit new product opportunities around their core expertise

ratings quality over the business cycle credit rating agencies cras have long held that reputational concerns discipline their behavior the value of reputation however depends on economic fundamentals that vary over the business cycle in a model of ratings incorporating endogenous reputation and a market environment that varies we find that ratings quality is countercyclical specifically a cra is more likely to issue less accurate ratings when fee income is high competition in the labor market for analysts is tough and securities default probabilities are low persistence in economic conditions can diminish our results while mean reversion exacerbates them the presence of naive investors reduces overall quality but quality remains countercyclical finally we demonstrate that competition among cras yields similar results

dynamic pricing in retail gasoline markets supergame models of tacit collusion show that supportable price cost margins increase with expected future collusive profits ceteris paribus as a result collusive margins will be larger when demand is expected to increase or marginal costs are expected to decline using panel data on sales volume and gasoline prices in 43 cities over 72 months we find behavior consistent with tacit collusion in retail gasoline markets controlling for current demand and cost current margins increase with expected next month demand and decrease with expected next month cost the results are not consistent with intertemporal l inkages due to inventory behavior or customer loyalty

malmquist indices of productivity growth during the deregulation of norwegian banking 1980 89 productivity growth during the deregulation of the norwegian banking industry is studied within the framework of data envelopment analysis which explicitly allows for multiple outputs introducing malmquist indices for productivity growth total growth can be decomposed into frontier growth and change in each bank s distance to the frontier both the total growth index and its components can be consistently chained over time we find productivity regress at the average bank prior to the deregulation but rapid growth when deregulation took place deregulation also led to less dispersion of productivity levels within the industry

the economic impacts of turkish accession to the european union within the context of turkish eu27 trade relations it is envisaged that the preserve of trade protection will be within the agro food sectors once the commitments of the barcelona declaration are complete moreover given the economic size of agro food activity in turkey eu market integration is likely to bring notable secondary impacts on the broader turkish economy to this end a computable general equilibrium cge framework is employed to assess turkish accession to the eu unlike previous cge studies primary agriculture fishing and food sectors are disaggregated whilst in this study significant modelling improvements have been made to agricultural factor input and product market mechanisms to improve the credibility of the model results a final distinguishing feature of this study is the construction of a realistic baseline status quo scenario incorporating up to date trade and domestic agricultural policy reforms prior to turkish entry to the eu the results suggest that trade led growth in turkey is moderated due to tariff liberalisation prior to eu entry whilst turkish real income gains are dominated by budgetary transfers from the cap budget which are mirrored as eu27 costs as expected turkish migration increases reduces eu27 turkish production potential although income per capita in both regions falls relative to the baseline

economies of diversification in the us credit union sector summary significant scale economies have been recently cited to rationalize a dramatic growth in the us retail credit union sector over the past few decades in this paper we explore another plausible supply side explanation for the growth of the industry namely economies of diversification we focus on the fact that credit unions differ among themselves in the range of financial services they offer to their members since larger credit unions tend to offer a more diversified financial service menu than credit unions of a smaller size the incentive to grow in size may be fueled not only by present scale economies but also by economies of diversification this paper provides the first robust estimates of such economies of diversification for the credit union sector we estimate a flexible semiparametric smooth coefficient quantile panel data model with correlated effects that is capable of accommodating a four way heterogeneity among credit unions our results indicate the presence of non negligible economies of diversification in the industry we find that as many as 27 91 depending on the type and the cost quantile of diversified credit unions enjoy substantial economies of diversification the cost of most remaining credit unions is invariant to the scope of services we also find overwhelming evidence of increasing returns to scale in the industry

jobs and agricultural policy impact of the common agricultural policy on eu agricultural employment abstract this paper investigates the relationship between eu agricultural subsidies and the outflow of labor from agriculture we use more representative subsidy indicators and a wider coverage panel data from 210 eu regions over the period 2004 2014 than has been used before the data allow to better correct for sample selection bias than previous empirical studies we find that on average cap subsidies reduce the outflow of labor from agriculture but the effect is almost entirely due to decoupled pillar i payments coupled pillar i payments have no impact on reducing labor outflow from agriculture i e on preserving jobs in agriculture the impact of pillar ii is mixed our estimates predict that an increase of 10 percent of the cap budget would prevent an extra 16 000 people from leaving the eu agriculture sector each year a 10 percent decoupling would save 13 000 agricultural jobs each year however the budgetary costs are large the estimated cost is more than 300 000 per year or more than 25 000 per month per job saved in agriculture

disclosure policy and industry fluctuations this paper examines voluntary disclosures in a repeated oligopoly and their association with price setting behavior and industry profits along industrial fluctuations the analysis focuses on the collectively optimal equilibrium among oligopoly firms we show that in industries that are highly concentrated or feature low cost of capital nondisclosure is prevalent and results in stable product prices and high profit margins otherwise firms may selectively disclose to soften competition in the product market under partial disclosure firms withhold information during sharp industry expansions or declines consequently the disclosure policy dampens the dissemination of shocks to the industry this paper was accepted by mary barth accounting

technical progress inefficiency and productivity change in u s banking 1984 1993 studies often find that on average u s commercial banks are quite inefficient and the authors find that banks became more technically inefficient between 1984 and 1993 from a new decomposition of the malmquist productivity index into changes in pure technical and scale efficiency as well as both pure technical changes and changes in scale of technology they find that much of the inefficiency increase can be attributed to the general failure of banks to adopt technological improvements made by a few banks that advanced the efficient frontier small banks experienced especially large decreases in both efficiency and productivity

the rigidity of prices this paper uses evidence on individual transaction prices to analyze price behavior the evidence shows that for many transactions pricesremain rigid for periods exceeding one year the rigidity of price ispositively correlated with industry concentration for several productsthe correlation of price changes across buyers is low the paper alsoinvestigates the relationship between price rigidity price change andthe length of time a buyer and seller have been doing business together the author interprets the evidence as emphasizing the importance of nonprice rationing and the inadequacy of models in whichprice movements alone clear markets copyright 1986 by american economic association

how decoupled is the single farm payment and does it matter for international trade the extent to which decoupled agricultural support including the european union single farm payment sfp creates production incentives remains unclear we apply an extended version of the standard global trade analysis project model and generate a set of 21 databases that captures a comprehensive representation of domestic support by considering and modeling a range of different assumptions regarding the sfp s degree of decoupling we investigate the sfp s effect on the model s results the results of our analysis reveal substantially different effects that depend on the degree of decoupling and the findings can help validate trade analysis results particularly for developing countries

a nonparametric approach for assessing productivity dynamics of large u s banks the 1980s marked an era of substantial change for the us commercial banking industry an issue of considerable interest to banking analysts and economists alike is whether the intensified competitive pressure generated by deregulation and notable financial innovations enhanced productivity to investigate the response to these changes the non parametric malmquist index is used to evaluate productivity dynamics a statistically significant productivity surge found between 1983 and 1984 is followed by productivity regress the next period post 1985 sustained productivity progress is observed for the remainder of the decade productivity movements are primarily attributable to technological changes rather than scale changes or convergence to the production frontier

accounting policies in agencies with moral hazard and renegotiation we emphasize the role of accounting policies and their audit in an earnings management setting we use a two period agency in which three frictions interact the agent privately observes action or effort supply and output and the initial contract is subject to renegotiation this creates a setting in which both players behavior is of concern and importantly information rationing is efficient moreover this information rationing is directly interpretable as being produced by an accounting policy whose application is ensured by an auditor

robust nonparametric quantile estimation of efficiency and productivity change in u s commercial banking 1985 2004 this article uses a new nonparametric unconditional hyperbolic order quantile estimator to construct a hyperbolic version of the malmquist index unlike traditional nonparametric efficiency estimators the new estimator is both robust to data outliers and has a root n convergence rate we use this estimator to examine changes in the efficiency and productivity of u s banks between 1985 and 2004 we find that larger banks experienced larger efficiency and productivity gains than small banks consistent with the presumption that recent changes in regulation and information technology have favored larger banks

collusion over the business cycle we present a theory of collusive pricing for markets in which demand alternates stochastically between fast growth boom and slow growth recession phases we show that 1 the most collusive prices are weakly procyclical countercyclical when demand growth rates are positively negatively correlated through time and 2 the amplitude of the collusive pricing cycle is larger when the expected duration of boom phases decreases and when the expected duration of recession phases increases we also offer a generalization of rotemberg and saloner s 1986 model interpreting their findings in terms of transitory demand shocks that occur within broader business cycle phases

malmquist type indices in the presence of negative data an application to bank branches in this paper we develop an index and an indicator of productivity change that can be used with negative data for that purpose the range directional model rdm a particular case of the directional distance function is used for computing efficiency in the presence of negative data we use rdm efficiency measures to arrive at a malmquist type index which can reflect productivity change and we use rdm inefficiency measures to arrive at a luenberger productivity indicator and relate the two the productivity index and indicator are developed relative to a fixed meta technology and so they are referred to as a meta malmquist index and meta luenberger indicator we also address the fact that vrs technologies are used for computing the productivity index and indicator a requirement under negative data which raises issues relating to the interpretability of the index we illustrate how the meta malmquist index can be used not only for comparing the performance of a unit in two time periods but also for comparing the performance of two different units at the same or different time periods the proposed approach is then applied to a sample of bank branches where negative data were involved the paper shows how the approach yields information from a variety of perspectives on performance which management can use

the impact of decoupled payments on farm choices conceptual and methodological challenges abstract in this paper we review the methodological framework for analysing decoupled payments in models of agricultural production market and technological uncertainty farm efficiency credit constraints farm household choices involving extra agricultural decisions policy uncertainty and long run impact of decoupling on investment and land values are the relevant issues that should be pursued by methodological and empirical analysis future research should refine the analysis of decoupled payments mainly trying to provide results that can be useful for policy simulation to bridge the gap between analysis at the individual level and sector policy models

trade liberalization in the presence of domestic regulations public policies applied to eu and u s wine markets abstractwine is the highest valued product in the agricultural food and beverage sector traded between the united states and the european union eu and wine faces a range of tariffs that are differentiated by country and product category in addition the production of wine grapes is heavily regulated within the eu and there are complicated state level policies in the united states designed to limit the retail availability of wine there continues to be economic and political pressure for reform to the tariffs between the united states and the eu and to the domestic regulations in each region we carefully develop parameters to characterize the effects of tariffs and domestic regulations that affect production and consumption of wine in the two regions simulation results show that reductions in tariffs would have relatively small effects in eu and u s wine markets whereas reductions in eu domestic policies that affect wine grape production would have much larger trade and welfare implications

evaluating the performance of us credit unions credit unions are small cooperative not for profit institutions which distinguishes them from other financial intermediaries in this study we conduct a performance evaluation of credit unions the criteria respect the unique organizational and institutional features of credit unions without losing sight of the fact that they must compete with other financial intermediaries we use nonparametric nonstochastic techniques to measure performance and we use parametric stochastic techniques to attribute performance variation to features of credit unions and their operating environment our sample consists of two thirds of all active credit unions in 1990