why are informal loans still a big deal evidence from north east thailand abstractthis article examines the use and benefit of informal loans for different income groups of rural households in north east thailand using a difference in differences estimation approach which is later complemented by propensity score matching the article shows that different household groups profit from informal loans in different ways poor households increase their asset endowment and in particular farming assets whereas rich households food consumption rises especially if households borrow due to a shock by showing that informal loans serve different households for different purposes this article provides an explanation why they still play an important role

pricing the strategic value of putable securities in liquidity crises putable security holders have a de facto rst claim on the rm s liquid assets and can threaten to force solvent issuers to bear nancial distress costs their threatening power implies that the puts have a strategic value larger than their intrinsic value strategic value depends on the issuer s size potential distress costs and the distribution of put ownership relative to the rm s liquidity position the analysis of kmart s put induced crisis in 1995 and a calibration to observed secondary market yield reductions on poison put bonds shows that strategic value is an important determinant of payouts received by bondholders 2001 elsevier science s a all rights reserved

why is bank debt senior a theory of asymmetry and claim priority based on influence costs this theory can explain why bank debt is universally senior consistent with the presence of conflict lawyers and absolute priority violations in financial distress better organized banks would more strongly contest priority in financial distress if they were junior because deterrence can reduce creditors total expenses in a priority contest the ex post stronger lobbyist litigant should be senior ex ante for equivalent reasons the theory can advise when public debt should be senior to trade credit and or implicit contracts and can even suggest one rationale for the absolute priority rule apr this article further shows that chapter hi creditor reimbursement procedures can lower overall costs article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

consequences of debt forgiveness strategic default contagion and lender learning i use a unique data set of loans to small business owners to examine whether lenders face adverse consequences when they grant debt forgiveness to borrowers i provide evidence consistent with borrowers communicating their debt forgiveness to other borrowers who then more frequently strategically default on their own obligations this strategic default contagion is economically large when the lender doubles debt forgiveness the default rate increases by 10 9 on average using an exogenous shock to the lender s forgiveness policy my findings suggest that as the lender learns about the extent of borrower communication the lender tightens its debt forgiveness policy to mitigate default contagion

assessing green energy economy stimulus packages evidence from the u s programs targeting renewable energy the paper provides a comprehensive empirical assessment of american stimulus policies aimed at renewable energy re technologies we use an indicator based methodology to assess progress with respect to energy environmental and socio economic issues resulting from re stimulus programs linked to the american recovery and reinvestment act and review and analyze the emerging but scattered literature overall our results indicate that stimulus programs have had a positive effect on the re sector this is despite the fact that they were originally planned to work in combination with a greenhouse gas cap and trade system which has not been implemented from the methodological perspective our approach is resource intensive and our analysis highlights numerous challenges notably related to causality and additionality despite these limitations this research improves our understanding of the broad effects and impacts of re stimulus programs

the role of market forces in assuring contractual performance the conditions under which transactors can use the market repeat purchase mechanism of contract enforcement are examined increased price is shown to be a means of assuring contractual performance a necessary and sufficient condition for performance is the existence of price sufficiently above salvageable production costs so that the nonperforming firm loses a discounted steam of rents on future sales which is greater than the wealth increase from nonperformance this will generally imply a market price greater than the perfectly competitive price and rationalize investments in firm specific assets advertising investments thereby become a positive indicator of likely performance

assessing the green economy in china an improved framework abstract theses on china s low carbon economy focus on the driving forces of carbon emissions energy carbon efficiency and the carbon economy nexus meanwhile comprehensive frameworks that assess china s green economy and also analyze its driving forces are lacking this paper constructs a green productivity index based on the global malmquist luenberger productivity index to evaluate the development of the low carbon economy in china a panel vector auto regression model is adopted to further analyze the endogenous interactions and dynamic relationships among aspects of the green economy and its influencing factors empirical results show that china has seen a balanced development of green economic growth in 2000 2016 achieved in a series of clear stages to maintain the sustainable growth of the low carbon economy in the future china must rely more on technological progress this research also makes some important discoveries that have not been found in previous studies the impact of china s industrial structure and energy consumption structure on the green economy are short term having a duration of impact of approximately four years finally we provide an assessment of provincial green economy development and describe the corresponding policy implications

the resolution of financial distress most models of financial structure embody an assumption about financial distress that causes debt to be costly to the issuing firm this approach has been criticized on the grounds that the assumed costs could be avoided by a costless financial reorganization in this article we show that despite the possibility of costless reorganization it may be rational for firms to incur significant costs in the resolution of financial distress the main assumptions that give rise to our results are the existence of asymmetric courts to impose a reorganization on the claimants of a firm article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

on the nexus of financial development economic growth and energy consumption in china new perspective from a gmm panel var approach abstract this paper studies the endogenous relationships among financial development energy consumption and economic growth in china by applying a gmm panel var approach with a panel data of 30 chinese provinces over the period 1996q1 2015q4 financial development is measured by six individual indicators and by a comprehensive indicator obtained through the pca method we also account for regional heterogeneity by dividing our sample into three regions eastern region central region and western region we underline our findings in three aspects first financial development measured by most individual indicators m2 credit revenue of the insurance industry and stock market value and the comprehensive one has a significantly negative impact on economic growth second energy consumption can significantly contribute to economic growth in all regions while no feedback effect is found except in the western region this result is further supported by the granger causality tests last financial development in the sense of m2 credit stock turnover and the comprehensive indicator can significantly lessen energy consumption in all regions but this inhibitory effect is found to be largest in the western region followed by the eastern region and be smallest in the central region the granger causality tests confirm further the existence of heterogeneity across regions a bidirectional granger causality between the two variables is found in the eastern region a unidirectional granger causality running from energy consumption to financial development is identified in the central region and no significant causal relationship shows up in the western region our findings provide valuable policy implications for china heading for a green economic growth

fiscal spending and green economic growth evidence from china abstract the green economy is considered as an efficient way for sustainability but the connection between fiscal spending and green economic growth has not been systematically explained this paper attempts to fill this research gap based on the panel data of 282 prefecture level cities from 2005 to 2016 we first construct the green economic growth index by using the non radial direction distance function then by employing the system gmm estimation we further evaluate the effect of fiscal education spending and r d spending on green economic growth finally we explore the potential mechanism and discuss our findings we obtain the following conclusions 1 the green economic growth index fluctuated in the study period we attribute it to the political tournament of local governments 2 the system gmm estimation results confirm the existence of composition effect and technique effect in the full sample but the sub sample analysis suggests that there is a heterogeneous effect in different areas with different resources abundant degree 3 mechanism analysis illustrates that fiscal r d spending and education spending foster the green economic growth through technological activities and human capital intensive activities respectively but they exhibit distinct roles in different areas based on these findings we propose some targeted policy suggestions for promoting green economic growth

the effect of bankruptcy protection on investment chapter 11 as a screening device asymmetric information and conflicts of interest between equity and debt holders can force a distressed but efficient firm to liquidate and may enable a distressed inefficient firm to continue in the extreme if it is costless for an inefficient firm to mimic an efficient firm in a debt restructuring efficient and inefficient firms are equally likely to continue or liquidate this article shows that chapter 11 procedures impose costs on ineffilcient firms that would otherwise mimic efficient firms this separation induces voluntary filing for bankruptcy by ineffilcient firms and consequently enables efficient firms to continue when they would otherwise be liquidated

factors impeding credit use in small farm households in bolivia sample survey data show few bolivian small farm households using credit but most would like to borrow from formal market institutions a theoretical framework is developed to formulate testable hypotheses to identify factors that inhibit credit use major impediments to borrowing are scale of operations as measured by amount of useable land and borrower s transactions costs that arise from loan paperwork use of indian language remoteness from market little education and low degree of market integration when farmers with these characteristics borrow they tend to use informal market sources because of the lower transactions costs compared to those of formal market lenders the policy implication is if formal market lenders are to reach more farmers they must lower transactions costs

theories of share tenancy a critical survey for the past 2 decades the problems of agricultural tenancy have attracted a great deal of attention not only from agricultural economists but also from economists in general as a typical example of agencyprincipal contract relations despite the prolific growth of literature both theoretical and empirical there has been little convergence in opinions on tenancy contracts the divergence has been especially great on the understanding of the causes and the effects of sharecropping tenancy much confusion underlying the widely divergent perspectives has stemmed from partial treatments of contractual choice which unduly limit the optimizing behavior of contracting parties and the options of contract forms this essay aims at clarifying the sources of the confusion by reviewing the past literature in light of the more general theory of agency principal relations the agency theory in order to examine the problems of various theoretical models in a unified framework in section ii we first develop the basic framework of a general model of tenancy contract in section iii we clarify in terms of the general model contradictions latent in the traditional marshallian theory which asserts that share tenancy is inefficient because of the disincentive effect of cropsharing on the tenant s work effort in section iv we attempt to show that recent efforts to reconstruct the theory based on the traditional assumption have not yet been quite successful section v draws implications and testable hypotheses from more general theories incorporating the aspects of risk and uncertainty section vi tests allocational and distributional implications of those alternative hypotheses based on the summary of evidence col

carbon weighted economic development performance and driving force analysis evidence from china based on a data envelopment analysis framework this study develops an indicator termed as carbon weighted economic development cwed covering the dimensions of energy environment economy and resources to measure the economic development performance in a carbon emission conscious economy as an empirical application the proposed approach is applied to a case study of 30 provinces in china in addition to identify the driving forces underlying low carbon economic development in china we analyze the endogenous interactions and dynamic behaviors between cwed foreign direct investment foreign trade industrial structure local fiscal expenditure and energy consumption structure using a panel vector auto regression model the main findings show that 1 adjusting industrial structure by vigorously developing the service industry and reducing the coal energy share in the primary energy consumption structure are the two most effective approaches to improve cwed in both the short run and long run in return cwed has positive feedback effects on both approaches in the long run 2 increase of the fiscal expenditure has a short term positive effect on cwed 3 fdi has an indirect negative effect on cwed in the long run and foreign trade has an indirect positive effect on cwed in the short term

the design of securities abstract this paper investigates the determinants of security design we consider the assignment of both cash flows and voting rights focusing on corporate control we postulate that a conflict of interest exists between contestants for control and outside investors the conflict arises because private benefits of control give contestants an incentive to acquire control even when this reduces firm value security design is a tool for resolving these conflicts and maximizing firm value our main result is that a single voting security is optimal

adoption of agricultural innovations in developing countries a survey this paper reviews various studies which have provided a description and possible explanation to patterns of innovation adoption in the agricultural sector the survey points out that the tendency of many studies to consider innovation adoption in dichotomous terms adoption nonadoption may not be appropriate in many cases where the actual decisions are defined over a more continuous range more attention needs to be given to the socio cultural and institutional environment in area studies so that their interrelation with economic factors affecting adoption can be inferred the presence of several interrelated innovations is another aspect that needs to be considered more carefully in future research since a number of simultaneous decisions may be involved furthermore the possibility of regular sequential patterns in adopting components of a new technological package should be specifically addressed in future studies finally the impact of differential adoption rates on land holding distribution merits attention in future research

an empirical investigation of u s firms in reorganization the purpose of this paper is to understand the institutional features of chapter 11 from an empirical examination of thirty firms that have emerged from reorganization we find the recontracting framework of chapter 11 to be complex lengthy and costly violations of absolute priority in favor of stockholders are frequently encountered these deviations may result from the bargaining process of chapter 11 or from a recontracting process between creditors and stockholders which recognizes the ability of stockholder oriented management to preserve firm value an example of such recontracting addresses myers underinvestment problem an investigation of the effects of chapter 11 on the pricing of risky debt is also provided the purpose of this paper is to understand the institutional features of chapter

the production tax credit for wind turbine powerplants is an ineffective incentive abstract the us energy policy act epact of 1992 created a production tax credit of 1 5 kwh available for 10 years to promote certain renewable energy technologies including wind turbines this paper argues that the impact of the wind turbine production tax credit will be minimal the argument depends entirely on the nature of the project finance structure used by the private power industry for wind turbine development we show that tax credits can only be absorbed by equity investors if there is a large fraction of equity in the project capital structure this raises the financing cost of wind turbine projects compared to conventional power technology which relies on a large fraction of low cost debt if the tax credit were paid as a cash subsidy the capital structure could be shifted to low cost debt and financing costs could be significantly reduced

the effect of industrial agglomeration on green development efficiency in northeast china since the revitalization abstract using panel data from 2003 to 2016 this paper estimates the green development efficiency of 34 cities in northeast china based on the sbm dea model and determines whether industrial agglomeration promotes or impedes green development efficiency the results show the following 1 the average green development efficiency of northeast china exhibits a fluctuant upward trend in 2003 2016 and there are significant spatial differences 2 during the revitalization period industrial agglomeration hinders green development efficiency a u shaped relationship exists between industrial agglomeration and green development 3 economic development level and foreign direct investment are positively related to green development efficiency while industrial structure energy consumption structure and environmental regulation are negatively related economic development level has the greatest positive influence and environmental regulation the strongest negative influence on green development several corresponding policy implications are proposed for promoting green development and revitalization

decomposition analysis of co2 emissions from electricity generation in china abstract electricity generation in china mainly depends on coal and its products which has led to the increase in co2 emissions this paper intends to analyze the current status of co2 emissions from electricity generation in china during the period 1991 2009 and apply the logarithmic mean divisia index lmdi technique to find the nature of the factors influencing the changes in co2 emissions the main results as follows 1 co2 emission from electricity generation has increased from 530 96 mt in 1991 to 2393 02 mt in 2009 following an annual growth rate of 8 72 coal products is the main fuel type for thermal power generation which accounts for more than 90 co2 emissions from electricity generation 2 this paper also presents co2 emissions factor of electricity consumption which help calculate co2 emission from final electricity consumption 3 in china the economic activity effect is the most important contributor to increase co2 emissions from electricity generation but the electricity generation efficiency effect plays the dominant role in decreasing co2 emissions

the political economy of farm size in india the elusive quest the political economy of farm size recognizes both economic and political reasons for an agrarian policy that attempts to influence the size of holdings that any single entrepreneur or family may control after nearly 30 years of discussion and debate and an extensive empirical literature on the subject the interest is still high and definitive answers are still elusive an impressive array of economists have studied this issue in the context of indian agriculture and it is to this literature that we will devote our attention to attempt a synthesis and clarification of the farm size productivity issue even for a single country is daunting yet informed policy requires a sound basis for conscious social choices that would restrict an individual s presumed right to acquire yet more land

the response of the beijing carbon emissions allowance price bjc to macroeconomic and energy price indices in 2013 china opened pilot carbon emission trading markets in seven provinces where carbon emission allowances have now been traded for more than two years in this paper we employ a structural var model and the price of the beijing carbon emission allowance to study the dynamic relationships among the price of the carbon emission allowance economic development and the price of energy this paper s data cover the period from april 2 2014 to november 6 2015 this paper provides information that will be helpful to both investors and governmental policy makers the results show that 1 an increase of one standard deviation in the coal price leads to an initial increase of approximately 0 1 in the beijing carbon price after 2 days there is a decrease of less than 0 1 and the price gradually increases by approximately 0 1 after 30 days 2 the price of the beijing carbon emission allowance is mainly affected by its own historical price 3 the beijing carbon emission allowance price crude oil price natural gas price and economic development have positive albeit non significant correlations

efficiency evaluation and dynamic evolution of china s regional green economy a method based on the super pebm model and dea window analysis abstract given the current circumstances of increasingly serious resource consumption and environmental pollution the development of china s green economy will profoundly impact the nation s future economic prosperity and even global economic development based on panel data from 2008 to 2017 this paper measures the green economic efficiency gee of chinese regions and analyzes its dynamic evolution using time series based on a novel data envelopment analysis dea model using environmental dea techniques this paper introduces the super pebm ebm based on pearson correlation coefficient model which is developed from the epsilon based measure ebm model and combines super pebm with the window analysis method firstly environmental dea technology is used to analyze gee at the regional level in china secondly based on panel data the window analysis method is used to analyze the regional differences of china s regional gee finally the development trend of china s regional gee in different time windows is obtained by combining the super pebm model and window analysis the empirical analysis results using panel data for regions in china from 2008 to 2017 show that 1 the overall gee of china is slowly increasing and the regional differences are still significant and 2 the improvement of gee can help to reduce regional differences

the determinants of credit access and its impacts on micro and small enterprises the case of garment producers in kenya abstract there are diverse sources of credit for micro and small manufacturing enterprises mses in developing countries ranging from relatives and friends rotating savings and credit associations roscas micro finance institutions and commercial banks using a unique set of data on mses in garment clusters in nairobi this study attempts to identify the determinants of access to different credit sources and their impacts on firm profitability and growth the results of the regression analysis demonstrate that factors determining access to credit are often different from those affecting enterprise performance indicating limited impacts of credit access on enterprise performance

multiple lenders and corporate distress evidence on debt restructuring multiple banking is a common characteristic of the corporate lending particularly of medium sized and large firms however if the firms are facing distress multiple lenders may have serious coordination problems as has been argued in the theoretical literature in this paper we analyse the problems of multiple banking in borrower distress empirically we rely on a unique panel data set that includes detailed credit file information on distressed lending relationships in germany in particular it includes information on bank pools a legal institution aimed at coordinating lender interests in distress we find that the existence of small pools increases the probability of workout success and that this effect reverses when pools become large we identify major determinants of pool formation in particular the number of banks the distribution of lending among banks and the severity of the distress copyright 2008 wiley blackwell

regional low carbon economy efficiency in china analysis based on the super sbm model with co2 emissions abstract as the largest energy consumer and co 2 emitting country the chinese government is committing to a low carbon economy it is meaningful and contributes to evaluate and analyze the low carbon economy efficiency lcee of china a super slack based measure super sbm model with undesirable outputs as combined with the malmquist productivity index is proposed to measure the lcee and the dynamic low carbon economy efficiency dlcee of 30 provinces in mainland china from 2005 to 2012 the theil index is also used to measure the rationalization level of industrial structure rlis for discussing the improvements to the lcee in china the results indicate that the proposed undesirable outputs super sbm model can effectively rank the sbm ef cient provinces china s regional economic development does not follow a low carbon pattern with an average lcee of 0 517 as a whole the china s economic development is gradually following a low carbon development pattern with an annual lcee improvement of 4 5 the rlis of china is also gradually changing better as well through a comparative analysis of the lcee and rlis the 30 provinces are divided into three sub areas and relevant suggestions are presented for improving the lcee of different sub areas in the future

the effect of capital structure on a firm s liquidation decision abstract a firm s liquidation can impose costs on its customers workers and suppliers an agency relationship between these individuals and the firm exists in that the liquidation decision controlled by the firm as the agent affects other individuals the customers workers and suppliers as principals the analysis in this paper suggests that capital structure can control the incentive conflict problem of this relationship by serving as a pre positioning or bonding mechanism appropriate selection of capital structure assures that incentives are aligned so that the firm implements the ex ante value maximizing liquidation policy

an analysis of offer functions of banks and credit unions in guatemala economists have sought to identify institutions which might fill the gap in household access to credit arising from rationing by formal lenders credit unions have been identified as institutions which might use informational and monitoring advantages to fill that gap using information on household perceptions of their access to credit this article analyses the impact of certain credit unions on the access to credit of households in guatemala regression results indicate that credit unions serve markets unserved by formal lenders and that information on household perceptions of their access to credit is important in making inferences about lender lending activities

bankruptcy and agency costs their significance to the theory of optimal capital structure we support and generalize our original results 1978 in light of potential impediments to a pure market solution to agency problems and potential causal links between liquidation and bankruptcy in the case of bankruptcy costs market impediments are easily elimi nated through the inclusion of simple provisions in corporate charters and bond inden tures further we demonstrate that recent attempts to link liquidation costs to capital structure are without merit if the firm is to be liquidated on the basis of a rule other than one that maximizes the total value of all the claimants arbitrage profits arise and informal reorganization will discipline management to follow the liquidation rule that is optimal for existing securityholders also we find that the pure market solution is not readily generalizable to other classes of agency problems particularly the risk incentive problem how ever the alternative solution of the risk incentive problem through complex financing contracting may be useful in explaining complexities in contemporary financial contracts in a previous paper 1978 we employed arbitrage arguments to show that in a well functioning market bankruptcy costs are an insignificant determinant of a firm s capital structure we also pointed out that the decision to liquidate and its associated costs can be separated from the event of bankruptcy moreover any costs actually associated with the event of bankruptcy must be limited to the costs associated with an informal reorganization of the capital structure in the capital market prior to default these results were argued to hold under a com plex environment with multiple periods multiple securities and heterogeneous expectations we concluded that bankruptcy costs would be a significant deter minant of capital structure only in the face of irrationality on the part of market participants or unavoidable impediments to the arbitrage process since the publication of our paper there has been an accumulation of the

access to capital and agrarian production organisation there are two problems both universal that entrepreneurs in any economy must contend with firstly an agent generally has access only to a limited amount of working capital secondly workers hired by an agent are subject to moral hazard and this necessitates their supervision this paper models for an agrarian economy the constraints imposed on entrepreneurs activities by these two problems and endogenously determines the various organisational forms of production as well as the allocation of resources that will obtain with a simple model we endeavour to explain a diverse set of empirical observations pertaining to the less developed countries in terms of the general processes that determine the distribution of income among the various agents and the hierarchical relationships that develop among them agricultural production typically involves a period of several months between the time the inputs are purchased and the time the output is marketed access to working capital and hence to the credit market thus plays an important role in a farmer s production decisions the distribution of access to credit in turn tends to be an important determinant of income distribution in poor agrarian economies credit is invariably rationed according to the ability to offer collateral the amount of working capital a farmer can mobilise therefore depends on the amount of land he owns which is often a good proxy for his overall wealth and thus his ability to offer collateral further since hired hands have a propensity to shirk they need to be supervised and therefore the

liquidation values and the credibility of financial contract renegotiation evidence from u s airlines how do liquidation values affect financial contract renegotiation while the incomplete contracting theory of financial contracting predicts that liquidation values determine the allocation of bargaining power between creditors and debtors there is little empirical evidence on financial contract renegotiations and the role asset values play in such bargaining this paper attempts to fill this gap we develop an incomplete contracting model of financial contract renegotiation and estimate it using data on the airline industry in the united states we find that airlines successfully renegotiate their lease obligations downward when their financial position is sufficiently poor and when the liquidation value of their fieet is low our results show that strategic renegotiation is common in the airline industry moreover the results emphasize the importance of the incomplete contracting perspective to real world financial contract renegotiation

conflicts in bankruptcy and the sequence of debt issues this paper investigates the optimal sequencing of debt issues our theoretical model suggests that once firms issue debt with one level of seniority they may have an incentive to alternate seniorities because of violations of the priced absolute priority rule apr when we introduce explicit costs of class conflict the model yields cases of alternating seniorities and other cases in which firms issue only one class of debt the implications of the model are consistent with the observed regularities in a large database of debt issues we test several other implications of our model as well

a theory of interactions between mfis and informal lenders abstract we provide a theoretical analysis of effects of entry of a microfinance institution mfi into an informal credit market which is segmented whereby informal lenders derive some market power owing to privileged information concerning borrower specific default risks relative to informal lenders the mfi has a cost advantage and an informational disadvantage regarding borrower risk borrowers differ along another dimension landholding which is observable to all lenders mfi entry is shown to induce selection effects across risk and landownership dimensions in shifts of borrowers from informal lenders to the mfi which could raise informal interest rates as observed in many ldcs the model is consistent with evidence from bangladesh and west bengal in contrast to hypotheses based on cream skimming scale diseconomy inducing collusion facilitating or crowding in effects of mfis on informal credit the model implies that mfi entry is pareto improving for borrowers irrespective of effects on informal interest rates

the resolution of bankruptcy by auction allocating the residual right of design abstract in this paper we examine the value of the right to choose the method of sale of corporate assets we show that this right is valuable and that its value comes from recognizing conflicting incentives of claimants at the time of sale as with risky projects senior and junior claimants are shown to have distinct preferences on a set of common auction procedures they also differ on the issue of allocation of resources towards attracting bidders for the auction as a consequence the optimal allocation of the design right must depend on circumstances prevailing at the time of the sale while in general selling the firm by auction does not guarantee the use of optimal selling arrangements a suitable allocation of design rights may help mitigate inefficiency problems significantly

the demands for funds by agricultural households evidence from rural india this study presents estimates of borrowing functions based on rural household data for india it improves upon existing work in three key areas first it is shown that existing studies have used an inappropriate definition of the demand for funds which when rectified produces quite different results second the interaction between agricultural technical change and the rural finance market is examined and it is shown that farmers in a position to benefit from technical change tend both to borrow more and to face lower interest rates third it is shown that farm specific interest rates when introduced endogenously are quite sensitive to personal and locational characteristics and are significant determinants of borrowing

the relation between farm size and farm productivity the role of family labor supervision and credit constraints abstract the paper shows that if the performance of hired farmhands is affected by supervision from family members and if the availability of credit is dependent on the amount of land owned then a systematic positive or negative relationship between per acre yields and farm size will prevail a model with no supervision effects on labor productivity would predict that yields are unaffected by farm size the paper also investigates the relation between land utilization and owned holding size when land rental possibilities are limited results are shown to be compatible with various observed patterns in ldcs

debtor in possession financing and bankruptcy resolution empirical evidence abstract debtor in possession dip financing is unique secured financing available to firms filing for chapter 11 opponents of dip financing argue that it leads to overinvestment alternatively dip financing can allow funding for positive net present value projects that increase the likelihood of reorganization and reduce time in bankruptcy using a large sample of bankruptcy filings we find little evidence of systematic overinvestment dip financed firms are more likely to emerge from chapter 11 than non dip financed firms dip financed firms have a shorter reorganization period they are quicker to emerge and also quicker to liquidate the reorganization period is even shorter when prior lenders provide the dip financing

financial distress stock returns and the 1978 bankruptcy reform act we study distress risk premia around a bankruptcy reform that shifts bargaining power in financial distress from debtholders to shareholders we find that the reform reduces risk factor loadings and returns of distressed stocks the reform effect is stronger for firms with lower firm level shareholder bargaining power an increase in credit spreads of riskier relative to safer firms in particular for firms with lower firm level shareholder bargaining power confirms a shift in bargaining power from bondholders to shareholders out of sample tests reveal that a reversal of the reform s effect leads to a reversal of factor loadings and returns

driving factors of carbon embodied in china s provincial exports in this paper we use the multi regional input output model mrio and logarithm mean divisia index approach to analyze the changes in china s carbon embodied in exports cee at the national and provincial levels the results indicate that the total cee and the cee of 17 provinces including all eastern provinces decreased between 2007 and 2010 the largest decrease in total cee is caused by an input structural effect which decreases the cee of most of the provinces the technique effect arising from changes in provincial carbon intensities causes the second largest decrease in total cee and it effectively reduces the cee of most of the provinces especially the eastern provinces changes in the export composition of most of the provinces also decrease the provincial cee a change in the provincial distribution of exports decreases the cee in 11 provinces on the one hand and increases the cee in 19 provinces on the other hand a change in export volume increases the cee of each province and the whole country but its total effect is evidently lower than the input structural effect and the technique effect c 2015 elsevier b v all rights reserved

capital structure under costly enforcement we consider financial structure and repayment behavior in a setting where cash flows are private information to the entrepreneur and the cost of enforcing repayment differs across security holders if enforcement costs are lower for shareholders than for creditors a mixed capital structure with debt and equity can obtain in equilibrium under a mixed capital structure creditors intervene in low cash flow states while shareholders intervene in high cash flow states moreover strategic defaults costly bankruptcy shareholder intervention and violation of absolute priority occur with positive probability on the equilibrium path several of the predictions from our framework are consistent with evidence not readily explainable by existing theories

strategic analysis of contingent claims traditional contingent claims analysis provides an elegant and complete model of the financing of the dynamic firm but has difficulty fitting the observations in the market recent work in corporate finance suggests this is because of its failure to model financial distress realistically we survey recent efforts to address this issue by deriving valuation formulae from the analysis of non cooperative equilibria in extensive form games we illustrate how a simple static bankruptcy model can be incorporated in a dynamic game we then show how to find the continuous time equivalent of this game this we use to find closed form bond formulae in special cases and to exploit efficient numerical techniques generally

opportunistic underinvestment in debt renegotiation and capital structure abstract this paper models debt renegotiation as a bargaining game between debtholders and shareholder oriented management in which management credibly threatens to run down firm assets to force concessions from the creditors creditors anticipate this opportunistic behavior by management creating an upper bound on debt capacity that is less than the value of the firm if an advantage to debt is introduced such as favorable tax treatment an interior optimal capital structure obtains even in the absence of realized bankruptcy costs our model also explains variations in debt equity ratios and the use of certain puzzling debt covenants

segmentation in rural financial markets the case of nepal abstract based on a farm household survey in nepal this study found that farm size and irrigation are major determinants of borrowing from formal institutions whereas family size is the most decisive factor in borrowing from informal sources formal sector borrowing per hectare of cultivated area however initially increases and then decreases with farm size our analysis indicates that while very small farmers tend to be excluded from the formal financial market because of a lack of collateral very large farmers choose to borrow less from that source because of lower production efficiency

an investigation of cost differences between public sales and private placements of debt abstract we examine the cost differences between public sales and private placements of debt for a sample of public utility issues the lowest cost method depends on a firm s transaction costs which comprise flotation costs agency costs and the costs of searching the market our findings suggest that firms minimize the cost of issuing securities by selecting the market providing the lowest transaction costs

the impact of industrial structure efficiency on provincial industrial energy efficiency in china abstract regional disparity in terms of industrial energy efficiency is noticeable in china due to the unbalanced economic progress in past decades analyzing the provincial industrial energy efficiency and its influencing factors is of great significance to formulate differentiated policies to date the influence of many social economic factors on the industrial energy efficiency have been examined but the impact of the inter industry structure has almost been ignored in this paper the slacks based measure model incorporating undesirable output is applied to evaluate the industrial energy efficiency both at the provincial level and the sectoral level in china for the period 2010 to 2016 then industrial structure efficiency is introduced which reflects the inter industry structure and takes the sectoral level energy efficiency into consideration and the impact of the industrial structure efficiency on provincial industrial energy efficiency is tested by tobit regression model the results show that huge discrepancies of provincial industrial energy efficiency exist and the industrial structure efficiency is confirmed to be a determinative factor to the provincial industrial energy efficiency with the coefficient of 0 525 policy recommendations are provided for adjusting the provincial inter industry structure and improving the industrial energy efficiency

incentive conflicts bundling claims and the interaction among financial claimants we show that for certain capital structures equity has an incentive to buy out another claim and alter the firm s investment strategy so as to maximize the combined value of equity and the acquired claim this restructuring may reintroduce agency problems into capital structures which appear to avoid agency conflicts by bundling claims it is possible to avoid this agency problem the agency problem is also eliminated by dispersed ownership of the claims in the presence of other claims issued by the firm the projects that maximize the value of equity need not maximize the value of the firm e g myers 1977 an agency problem occurs because the equityholders select projects that are in the interest of equity rather than the firm as a whole for example if the firm comprises equity and bonds then equity would prefer risky projects and may undertake projects that are undesirable from the firm s perspective but desirable from the equity perspective the resulting difference in the claimants preferences among projects could be limited by structuring the financial claims so that the preferences of equityholders among projects are similar to those of the firm as a whole the issuance of separate claims that are individually both more risky and less risky than the equity can control incentive problems for a fixed capitalization without trading see jensen and meckling 1976 and green 1984 green 1984 examines the financing of a new project by a combination of warrants and bonds and shows that if the warrants and bonds correctly balance then the incentives of equity still will be to maximize the value of the firm for this fixed capital structure the incentive conflicts are removed and the optimal strategy for equity coincides with the firm s optimal strategy a time inconsistency problem can arise when an earlier period is added to allow trading among the financial claimants we initially suppose that the capital structure is designed so that without trading equity has an incentive

investment policy and exit exchange offers within financially distressed firms this article examines the conflict of interest between shareholders and bondholders in a setting in which firms can renegotiate the terms of existing debt with public debtholders in particular we consider one of the most common types of debt restructuring the exit exchange offer our analysis explores the relation between exitexchange offers and investment choice by the manager and it concludes that managers acting strategically on behalf of shareholders may select inefficient investment projects in order to enhance their bargaining position vis a vis creditors holding the upside potential of an investment project fixed managers shareholders prefer projects with lower payoffs in states of bankruptcy because it induces individual bondholders to accept poorer terms in a debt for debt exit exchange offer thus generating a greater residual for shareholders in states of solvency additionally we show how the investment inefficiencies in our analysis depend on i the inability of bondholders to coordinate their actions ii the ability of managers to commit to suboptimal investment projects and iii the coupling of an individual bondholder s decision to tender and her decision to consent to allow the firm to strip fiduciary covenants we suggest conditions under which a ban on coupled exit exchange offers or alternatively constraints on debt for debt exchanges would be efficiency enhancing

modelling energy intensity pollution per capita and productivity in italy a structural var approach abstract in this paper we present a green growth model with energy and pollution a structural var approach is used to test its empirical implications for the italian economy data span over the 1961 2010 period our model develops the original contribution by adom and kwakwa 2014 2 aimed at identifying the long run forces driving the dynamics of a set of variables specifically we identify the long and short run structural shocks of the variables of interest by means of restrictions from theory our results show that 1 the estimated conditional correlations of energy intensity and pollution per capita are positive for both supply and demand shocks and 2 the impulse responses show a persistent increase of both energy intensity and pollution per capita to supply shocks the main insight is that the var residuals are combinations of structural supply and demand shocks

control rights debt structure and the loss of private benefits the case of the uk insolvency code we show how the efficiency of reorganization is affected by the distribution of control rights under the u k insolvency code control rights raise particular problems when creditors have different incentives to keep the firm as a going concern such differences may arise from the possession of private benefits by particular creditors which are lost if the debtor firm is liquidated the incidence of inefficient liquidations is influenced by the size and seniority of creditors claims the current u k code is widely thought to give rise to inefficient liquidations we show however that inefficiency depends upon the debt structure and whether the controlling creditor in formal bankruptcy has private benefits article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

differential adoption of modern rice technology and regional wage differential in nepal in nepal which consists of ecologically distinct regions the concentration of the adoption of modern rice varieties in the favourable rice growing areas of the country has raised fears that regional income disparities have widened this study shows that greater demand for hired labour due to the adoption of modern rice varieties has induced permanent and seasonal migration from unfavourable to favourable areas this appears to have largely equalised average wage rates across different production environments thus as far as labour income is concerned benefits from the modern varieties have been widely shared

behavioural and material determinants of production relations in agriculture in this essay we develop a framework for analysing the major institutions governing the production and exchange of output and the primary factors of production in rural areas the analysis incorporates general considerations of risk and information constraints jointly with the principal material attributes of agriculture and of agricultural production factors the framework is used to analyse barriers to the existence of the major intertemporal and factor markets it is applied specifically to land scarce environments for which it provides an internally consistent explanation for many of the well documented institutional features of such settings in addition the analysis provides new implications for among other phenomena the inter relationships among ownership holdings operational scale family size and factor productivity for the scarcity of animal rental markets and use of animals as collateral for the renting out of land by small landowners and for the existence of plantations for certain crops

conflicts of interest and market illiquidity in bankruptcy auctions theory and tests i develop and estimate a model of cash auction bankruptcy using data on 205 swedish firms the results challenge arguments that cash auctions as compared to reorganizations are immune to conflicts of interest between claimholders but lead to inefficient liquidations i show that a sale of the assets back to incumbent management is a common bankruptcy outcome sale backs are more likely when they favor the bank at the expense of other creditors on the other hand inefficient liquidations are frequently avoided through sale backs when markets are illiquid that is when industry indebtedness is high and the firm has few nonspecific assets the problem of designing an efficient bankruptcy law has received considerable attention in the last decade much of the debate has centered around the optimality of two different stylized bankruptcy procedures cash auctions such as the u s chapter 7 code and structured bargaining represented by the u s chapter 11 reorganization code recently several european countries including france germany and great britain have changed their bankruptcy regulation by introducing reorganization procedures similar to chapter 11 at the same time the chapter 11 code has been criticized by academics including baird 1986 emphasizing that the bargaining procedure frequently results in long and wasteful negotiations these critics argue that chapter 11 should instead be replaced with a mandatory auction procedure other researchers such as aghion hart and moore 1992 and shleifer and vishny 1992 have pointed out that a cash auction is likely to suffer from considerable inefficiencies arising from transaction costs and market illiquidity the nature and costs of the chapter 11 procedure are

rural credit markets and institutions in developing countries lessons for policy analysis from practice and modern theory this article presents evidence of the failure of government intervention in rural credit markets of ldcs in the past three decades it then shows how lessons for policy analysis can be drawn from modern theory particularly those theories focussing on credit rationing in competitive markets and interlinking of credit contracts with labor and land contracts the article outlines the policy implications of these theories and finds them insufficient to account for the empirical evidence it contends that a more systematic and rigorous analysis of institutions and institutional environments is essential for understanding and implementing effective policy reforms of rural credit markets it presents suggestions for undertaking such an analysis

regional energy environmental performance and investment strategy for china s non ferrous metals industry a non radial dea based analysis globally china is the largest producer and consumer of common non ferrous metals china s non ferrous metals industry is energy intensive accounting for 24 of the total industrial energy consumption in 2011 in this study we adopted a non radial dea model to examine the energy environmental performance of the non ferrous metals industry from a regional perspective during the 2006 2011 period the energy environmental performance was evaluated by the eco efficiency under natural disposability en eco efficiency under managerial disposability em eco efficiency under natural and managerial disposability enm and enm with desirable congestion enm dc based on the en both the energy conservation and emission reduction potentials were calculated additionally the investment strategy was confirmed by regional types of damages to return dtr in the second stage study the factors influencing eco efficiency were measured using tobit regression and truncated regression models the results indicated that the efficiency scores of en em enm and enm dc were considerably different investment was effective in improving the energy environmental performance for twenty one regions during the whole study period henan had the highest energy conservation and emission reduction potentials the results obtained from the regression models were similar which displayed that the population density and energy price were responsible for the increase in eco efficiency while economic development level and industrial structure affected eco efficiency negatively based on these results policy recommendations for the non ferrous metals industry to improve their performance in a low carbon economy are suggested

impact of urbanization on energy related co2 emission at different development levels regional difference in china based on panel estimation abstract we examined the influence of urbanization on co2 emission at different development levels employing the stochastic impacts by regression on population affluence and technology stirpat model on provincial panel data from 1995 to 2013 for china to investigate regional differences based on development levels in the effects of urbanization on co2 emission we divided the 29 provinces of china into three regions according to their per capita real gdp at constant value 1990 100 the panel estimation for the whole dataset and the three regions showed an inverted u relationship between urbanization and co2 emission in the major regions of china specifically the effects of urbanization vary significantly across the regions in region 2 and region 3 a threshold level was identified beyond which the emission urbanization elasticity was negative and further increases in the urbanization rate did not contribute to higher emissions however in region 1 only population and affluence rather than urbanization were significant factors affecting co2 emissions in addition the results did not confirm the environmental kuznets curve relationship between income and co2 emission where co2 emission increases monotonically with income we propose a series of policy implications based on these outcomes to help realize emission reduction targets better

sequential bargaining with incomplete information this paper describes a simple two person two period bargaining game and solves it using the concept of perfect bayesian equilibrium in which the actions of each player convey information which is used by his opponent the paper examines the effects of changes in bargaining costs the size of the contract zone and the length of the bargaining process on such aspects of the solution as the probability of impasse and the likelihood of concessions the combination of information transfer and the lack of pre commitment embodied in perfectness yields many surprising results common perceptions about the effects of parameter changes on bargaining processes are suspect and should be checked in the particular game being discussed

equilibrium credit rationing of small farm agriculture it is often argued that externally imposed contractual restrictions lead to inequitable credit rationing this paper argues that unrestricted laissez faire markets may also inequitably ration credit a formal model which grants borrowers autonomy in credit application and use demonstrates that adverse incentive and selection effects may cause banks to endogenously impose interest rate restrictions and ration small farms out of the credit market consequently liberalization of financial markets may be insufficient to guarantee small farms access to credit

determinants of credit rationing a study of informal lenders and formal credit groups in madagascar abstract previous research on the determinants of credit rationing focused exclusively on the behavior of formal lenders who contract directly with an individual borrower based on survey data from madagascar this paper presents an analysis of credit rationing by informal lenders and by members of community based groups that allocate formal group loans among themselves the results show that group members are able to obtain and to use locally available information about the applicant s creditworthiness in much the same way as informal lenders do both types of lenders use the applicant s debt servicing obligations and income as the main criteria for credit rationing this paper therefore empirically confirms theoretical arguments that community based groups have an information advantage over distant formal bank agents

green economy and related concepts an overview for the last ten years the notion of a green economy has become increasingly attractive to policy makers however green economy covers a lot of diverse concepts and its links with sustainability are not always clear in this article we focus on definitions of green economy and related concepts and an evaluation of these concepts against the criterion of strong and weak sustainability the article serves three purposes firstly we identify and describe diverse theories concepts approaches and tools related to a green economy among these are the theories of environmental economics and ecological economics the concepts and approaches of cleaner production waste hierarchy bio economy industrial ecology circular economy nature based solutions and dematerialization through product servicizing and tools like life cycle assessment and cost benefit analysis secondly we develop a framework that shows the capacity of the green economy concepts approaches and tools to support the transition towards sustainability such a framework can serve as a heuristic to embed diverse concepts and approaches into a green economy framework thirdly we briefly discuss green economy concepts with respect to their impact on strong and weak sustainability depending on the different concepts approaches and tools identified in the green economy framework different degrees of substitutability and trade offs between environmental and economic benefits are allowed and more or less structural changes of our modes of living are required by discussing the notion of green economy and related concepts approaches and tools we seek to make a contribution to their definitions and relationships as a prerequisite for operationalizing green economy

formal and informal rural credit in four provinces of vietnam abstract this paper uses a survey of 932 rural households to uncover how the rural credit market operates in vietnam households obtain credit through formal and informal lenders formal loans are almost entirely for production and asset accumulation while informal loans are used for consumption smoothening the determinants of formal and informal credit demand are distinct while credit rationing depends on education and credit history in particular regional differences in the demand for credit are striking a one size fits all approach to credit policy in vietnam would be inappropriate