Who Borrows from the Lender of Last Resort? DRECHSLER, ITAMAR; DRECHSEL, THOMAS; MARQUES-IBANEZ, DAVID ...
The Journal of finance (New York),
October 2016, Letnik:
71, Številka:
5
Journal Article
Recenzirano
We analyze lender of last resort (LOLR) lending during the European sovereign debt crisis. Using a novel data set on all central bank lending and collateral, we show that weakly capitalized banks ...took out more LOLR loans and used riskier collateral than strongly capitalized banks. We also find that weakly capitalized banks used LOLR loans to buy risky assets such as distressed sovereign debt. This resulted in a reallocation of risky assets from strongly to weakly capitalized banks. Our findings cannot be explained by classical LOLR theory. Rather, they point to risk taking by banks, both independently and with the encouragement of governments, and highlight the benefit of unifying LOLR lending and bank supervision.
Being one of the "mega trends" that has significantly impacted the tourism system, the role and use of social media in travelers' decision making and in tourism operations and management have been ...widely discussed in tourism and hospitality research. This study reviews and analyzes all extant social media-related research articles published in academic journals during 2007 to 2011, mainly in tourism and hospitality fields. Based on a content analysis on the analyzed articles from both the consumers' and the suppliers' perspectives, this article found that consumer-centric studies generally focused on the use and impact of social media in the research phase of the travelers' travel planning process. Supplier-related studies have concentrated closely on promotion, management, and research functions, but few discussed product distribution. Research findings thoroughly demonstrate the strategic importance of social media for tourism competitiveness. This study also contributes to the academia and industry by identifying some research voids in extant research and providing an agenda for future research.
Taking a combination between agency theory and resource dependence theory, we point out that directors' capital may have an effect on R&D strategies. A sample of both high‐tech and low‐tech ...industries for the period 2007–2011 is used. The results indicate that, regardless of the type of industry and the specific expertise on R&D intensive companies, board members with multiple directorships influence R&D corporate strategies. The resources acquired by directors through their experience and connections positively influence R&D intensity, but only if directors can carry out their monitoring activity adequately. This evidence implies a step forward in the understanding of the role of board of directors in corporate strategy, thus having significant implications for academics, companies and regulators, which are both theoretical and practical.
Prices collected from online retailers can be used to construct daily price indexes that complement official statistics. This paper studies their ability to match official inflation estimates in five ...Latin American countries, with a focus on Argentina, where official statistics have been heavily criticized in recent years. The data were collected between October 2007 and March 2011 from the largest supermarket in each country. In Brazil, Chile, Colombia, and Venezuela, online price indexes approximate both the level and main dynamics of official inflation. By contrast, Argentina's online inflation rate is nearly three times higher than the official estimate.
► The paper uses online prices to construct daily price indexes in five countries. ► Online indexes match the level and dynamics of inflation in Brazil, Chile, Colombia, and Venezuela. ► There is a large unexplained difference in the level of online and official inflation for Argentina. ► The best approximation to the official index is to use one-third of the inflation observed online.
This paper documents facts about the structure of business taxation in China using administrative tax data from 2007 to 2011 from the State Taxation Administration. We first document the importance ...of different business taxes across industries. Although corporate income taxes play an important role for manufacturing firms, these firms also remit a large share of their tax payments through the value-added tax system, through the excise tax system, and through payroll taxes. Gross receipts taxes play an important role for firms in other industries, leading to spillovers that may affect the overall economy. Second, we evaluate whether the structure of China’s tax revenue matches its stage of development. A cross-country comparison of sources of government revenue shows that China collects a high share of tax revenue from taxes on goods and services and a high share of income tax on corporations. Finally, we study whether firm-level differences in effective tax rates can be an important source of allocative inefficiencies. Decomposing the variation in effective tax rates across firms, we find that government policies, including loss carry-forward provisions and preferential policies for regional, foreign, small, and high-tech firms, have significant explanatory power. Nonetheless, although effective tax rates vary along a number of dimensions, tax policy does not explain the large dispersion in the returns to factors of production across firms.
We analyze the reactions of stock returns and the spreads of credit default swaps (CDS) of banks from Europe and the USA to four major regulatory reforms in the aftermath of the subprime crisis, ...employing an event study analysis. Contrary to public perception, we find that financial markets indeed reacted to the structural reforms enacted at the national level. The reforms succeeded in reducing bail-out expectations relative to the post-bail-out period, especially for systemic banks. The strongest effects were found for the Dodd-Frank Act and in particular for the Volcker rule. Bank profitability was affected in all countries, showing up in lower equity returns.
We find that put options trading volume and bid-ask spreads both increase with equity lending fees. However, we also find that put options trading volume decreases with lending fees for banned stocks ...during the 2008 Short-Sale Ban period, when only options market makers could short. By separating the speculative demand of short sellers from the hedging demand of options market makers in the lending market, our results provide a thorough analysis of the interaction between the options market and the equity lending market. We also shed light on the substitutability/complementarity between put options volume and short interest shown in the literature.
We use a systems-based econometric method to show that classic and market-based tournament models are empirically distinguishable since the role of risk differs across these models. Implementing the ...method using a large, Finnish, worker-firm matched panel, we find support for classic tournaments given that promotions depend on relative performance, the firm’s wage structure is convex, promotion probabilities are decreasing in the number of competitors, performance is increasing in the wage spread, and workers and firms adjust their choice variables in opposite directions when the variance of the stochastic component of worker performance changes.
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