Macroeconomics Commons^™

Integration Of And Deliveries Among The World Zionist Organization, Israel, And Diaspora Countries: System Articulation With The Social Fabric Matrix, F. Gregory Hayden

Department of Economics: Faculty Publications

The religious economics (not economics of religion) concern here is the relationship between the World Zionist Organization (WZO) and Israel, which is known as a geopolitical power in its region and which is also known as an economic success story. Joseph Schumpeter and Karl Polanyi explained how the political economy of medieval Europe was influenced and guided by Christian morality. This paper extends the analysis of religious economics by using the social fabric matrix of original institutional economics to define and structure the integration of the WZO, Israel, and the Diaspora countries. This allows us to observe how to conduct …

Pension Fund, Financial Development And Output Growth In Nigeria, Iwegbu Onyebuchi

Bullion

This study examines the indirect effect of pension fund on economic growth in Nigeria through the financial system. Using Autoregressive Distributive Lag (ARDL) model, the study found out that pension fund contribution is effective in stimulating growth through investment in portfolios that yield short term returns; this implies that pension fund contribution cannot on its own without a credible financial system impact on economic growth. The policy implication of this study is for Pension Fund Administrators (PFAs) to invest in portfolios with short-term returns; thus, a large chunk of funds invested in federal government securities should be unbundled to other …

Portfolio Capital Inflows And Banking Crisis In Emerging Market And Developing Economies (Mdes): Bank-Level Evidence From Nigeria, Tijjani Mohammed Jume

Bullion

The objective of the paper is to assess the effects of foreign portfolio capital surge on the banking sector in Nigeria from 2005 - 2018. Using a simple trend analysing a static general equilibrium framework, the paper reveals that portfolio capital inflows, in the wake of monetary policy independence in Nigeria, led to portfolio capital surge which resulted to credit boom and speculative transactions in the Nigerian Stock Exchange (NSE) leading to assets price bubble. When the bubble burst during the global financial crisis (GFC) in 2007, and thereafter in 2014, portfolio capital inflows reversed and banking stocks prices declined …

Investigating The Impact Of Widening Price Limits On Volatility: The Experience Of The Nigerian Stock Exchange, Mohmmed A. Yadudu

Bullion

This paper empirically evaluates the impact of return volatility from widening price limits from 5% to 10% on the Nigerian Stock Exchange(NSE) on September 18, 2012 using a Stochastic Volatility model in an event study framework. Using daily trading data from September 2010 to September 2014, the study finds that widening of price limits in the NSE has not increased volatility as feared by some regulators. Stocks with higher free floats and institutional ownership display lower volatility when price limits are widened. This suggests that smaller stock exchanges can improve market efficiency by widening price limits without increasing volatility. The …

Basel Iii D: Swiss Finish To Basel Iii, Christian M. Mcnamara, Natalia Tente, Andrew Metrick

Journal of Financial Crises

After the Basel Committee on Banking Supervision (BCBS) introduced the Basel III framework in 2010, individual countries confronted the question of how best to implement the framework given their unique circumstances. Switzerland, with a banking industry that is both heavily concentrated and very large relative to the size of its overall economy, faced a special challenge. It ultimately adopted what is sometimes referred to as the “Swiss Finish” to Basel III—enhanced requirements applicable to Switzerland’s “too-big-to-fail” banks Credit Suisse and UBS that go beyond the base requirements established by the BCBS. Yet the prominent role played by relatively new contingent …

Basel Iii A: Regulatory History, Christian M. Mcnamara, Thomas Piontek, Andrew Metrick

Journal of Financial Crises

From the earliest efforts to mandate the amount of capital banks must maintain, regulators have grappled with how best to accomplish this task. Until the 1980s, regulation had been based largely on discretion and judgment. In the wake of two bank failures, the central bank governors of the G10 countries established the Basel Committee on Banking Supervision (BCBS) and in 1988, the BCBS introduced a capital measurement system, Basel I. The system represented a triumph of the fixed numerical approach, however, critics worried that it was too blunt an instrument. In 1999, the BCBS issued Basel II, a proposal to …

Jpmorgan Chase London Whale Z: Background & Overview, Arwin G. Zeissler, Rosalind Bennett, Andrew Metrick

Journal of Financial Crises

In December 2011, the Chief Executive Officer and Chief Financial Officer of JPMorgan Chase (JPM) instructed the bank’s Chief Investment Office to reduce the size of its Synthetic Credit Portfolio (SCP) during 2012, so that JPM could decrease its Risk-Weighted Assets as the bank prepared to adopt the impending Basel III bank capital regulations. However, the SCP traders were also told to minimize the trading costs incurred to reduce Risk-Weighted Assets, while still maintaining the opportunity to profit from unexpected corporate bankruptcies. In an attempt to balance these competing objectives, head SCP derivatives trader Bruno Iksil suggested in January 2012 …

Incorporating Macroprudential Financial Regulation Into Monetary Policy, Aaron Klein

Journal of Financial Crises

This paper proposes two insights into financial regulation and monetary policy. The first enhances understanding the relationship between them, building on the automobile metaphor that describes monetary policy: when to accelerate or brake for curves miles ahead. Enhancing the metaphor, financial markets are the transmission. In a financial crisis, markets cease to function, equivalent to a transmission shifting into neutral. This explains both monetary policy’s diminished effectiveness in stimulating the economy and why the financial crisis shock to real economic output greatly exceeded central bank forecasts.

The second insight is that both excess leverage and fundamental mispricing of asset values …

Intragovernmental Autonomous Stabilizers, Alex Williams

Theses - Graduate Programs in Economic Theory and Policy

We present a novel framework for understanding the relationship between the federal and state governments of the United States of America. Drawing on the experience of state government finances during and after the Great Recession in 2008, we propose the establishment of novel intragovernmental budgetary stabilization mechanisms. We draw out the flawed arguments of the existing fiscal federalism literature and demonstrate how the work of Michael Pettis and Modern Monetary Theory provide more usable insights when crafting public policy. We propose several potential policy responses and produce a counterfactual model of state finances after the Great Recession using the new …

Non-Increasing Cost Functions: Making The Connection Between Keynesian And Neoclassical Macroeconomics, Max Von Holtzendorff

Theses - Graduate Programs in Economic Theory and Policy

No abstract provided.

An Analysis Of Excise Taxes On Wine In The United States, William A. Saunders

Honors Theses and Capstones

Excise taxes are a form of tax that are applied specifically to certain goods, and are charged by the wholesaler to the retailer; they are then usually passed onto the consumer through price increases. Throughout the history of the United States, this form of taxation has transformed and taken on a variety of different roles before arriving at its modern role; a tool to implement certain tax systems, such as the Pigovian system, as well as to influence consumer behavior. The purpose of this research is to evaluate the purpose of excise taxes on wine within the United States by …

Effectiveness Of Interest Rate Policy On The Management Of Macroeconomic Stability: Evidence From The United Kingdom, Mostafa Aboelsoud

Economics

This study examines the dynamic relationship between the London Interbank Offered Rate (LIBOR), the inflation rate, the unemployment rate and economic growth in the context of the UK, for the period 1992: Q1 to 2016: Q4. The study aims to evaluate the impact of the LIBOR on the management of macroeconomic stability in the UK during the period under review. The study employs a vector autoregressive (VAR) model to examine the dynamic relationship between interest rates, unemployment and GDP. A co-integration test evaluates the long-run relationship between these variables, and the VAR Granger-causality tests the direction of causation among the …

Does A Change In Immigration Affect The Unemployment Rate In Host Countries? Evidence From Australia, Mostafa Aboelsoud, Anas Alqudah, Eman Elish

Economics

is study examines and evaluates the dynamic causality relationship between immigration, unemployment, wages and GDP per capita in host countries with a focus on Australia. Previous research has indicated that the economic impact of immigration is significant; nonetheless, its effect on the labour market being positive or negative is inconclusive. This study uses a Vector Error Correction Model (VECM) to examine the dynamic short- and long-run nexus between these variables in Australia over the period 1980–2016. The paper provides clear evidence to policymakers on the positive spillover effect of immigration policies developed by the Australian government.

Contractual Arbitrage, Stephen J. Choi, G. Mitu Gulati, Robert E. Scott

Faculty Scholarship

Standard-form contracts are likely to be incomplete because they are not tailored to the needs of particular deals. In an attempt to reduce incompleteness, standard-form contracts often contain clauses with vague or ambiguous terms. Terms with indeterminate meaning present opportunities for strategic behavior well after a contract has been executed. This linguistic uncertainty in standard-form commercial contracts creates an opportunity for “contractual arbitrage”: parties may argue ex post that the uncertainties in expression mean something that the contracting parties did not contemplate ex ante. This chapter argues that the scope for contractual arbitrage is a direct function of the techniques …

A Cross-Country Empirical Analysis Of The Porter Hypothesis In The Chemical Industry, Maci Woyat

Williams Honors College, Honors Research Projects

This paper examines whether there is evidence to support or refute the Porter Hypothesis on a high polluting industry through analyzing the effect of environmental stringency on innovation in the chemical industry. Taking data from the Organization for Economic Cooperation and Development (OECD), we use country-level data from 2003-2015, to analyze how a country’s number of Class C chemical patents is affected by their Environmental Policy Stringency (EPS) Index. Using a fixed effect model, we controlled for differences in GDP, exports, investment in research and development, market competitiveness and participation in the industry. The initial results of this regression found …

Culture Of Countries And Country-Index Crash Risk, Jason Petri

Williams Honors College, Honors Research Projects

Previously crash- risk studies have focused on assessing at the firm level the likelihood of a firm’s equity to crash (a rapid decline in value), apart from the dynamics of its respective country-level market. In this study, however, I examine the determinants of an overall countrylevel equity crash apart from the dynamics of the global market. I will argue that this is a very different focus of analysis that will provide valuable information to both investors and policy makers. Expansion of credit and subsequent equity-market bubbles and crashes are of particular concern to foreign direct investors (FDI), as country-level equity …

Growth Convergence Across Countries And Regions In The Long Run: An Empirical Study Using Panel Analysis (1980-2018), Portia Mensah

Masters Theses

With the emergence of new superpowers, the changing landscape of the global economy, and the heterogeneity of growth experiences being discovered in recent times, the concept of growth convergence must be revisited. This study examines whether developing countries are catching up with the advanced countries in terms of their per capita income. The study uses a panel analysis of 69 countries over a period of 39 years spanning from 1980 to 2018 to test for growth convergence (both absolute and conditional) among countries based on the Augmented Solow model. The countries were further divided into three regions namely, Europe, Asia, …

The Effect Of Transparency, Independence And Accountability Of Central Banks On Disinflation Costs, Golnaz B. Motie, Joshua C. Hall

Economics Faculty Working Papers Series

Policymakers often want to achieve low inflation to avoid the low economic growth associated with high inflation. Reducing inflation through monetary policy (disinflation) is not costless as it can coincide with higher unemployment rates and reduced output. In this paper we use sacrifice ratios to calculate the cost of disinflation during the 1990s for 40 countries. We then study whether transparency and democratic accountability of monetary institutions reduces disinflation costs. Our empirical results suggest that more transparent central banks seem to face higher disinflation costs. This result could be because more transparent central banks have lower initial inflation rates during …

The Contribution Of Islamic Banks Towards The Achievement Of Sustainable Development Goals: The Case Of Indonesia, Nunung Ghoniyah

Economics and Finance in Indonesia

This study aims to strengthen the opinion that the main goal of Islamic banks is not to obtain profit, but rather to improve the standards of living. In this study, the evidence is obtained by processing secondary data on Islamic banks in Indonesia during the period of 2011 to 2017 by using panel data regression model. The results of the data analysis support the hypothesis that banks whose goals are aimed at falah will demand lower payment obligations from customers, allowing the customers to manage funds in the real sector. The implication is also strengthened by good financial quality control, …

The Effect Of School Operational Assistance Program On Investment In Education By Households: Evidence From Indonesia, Nia Pramita Sari

Economics and Finance in Indonesia

The School Operational Assistance Program, referred to as BOS, is a demand intervention program indirectly provided by the government of Indonesia to students through schools, started in July 2005. This paper examines the impact of BOS on educational investment by households and other expenditure such as food and non-food consumption. Using the observations of 1,161 households with at least one member studying in public school from the fourth wave of the Indonesian Family Life Survey (IFLS 4), we discover that BOS is effective in relaxing household's budget constraint, thus increasing educational investment by households. We also discover that households with …