Europe is facing slower growth as a result of protracted financial turbulence and spillovers from the U.S. Meanwhile, inflation has risen sharply. Policymakers in advanced economies will have to ...continue to support financial markets and balance risks to real activity with the need to anchor inflation. Emerging Europe is well placed to continue to grow, albeit at a slower pace, amid concerns about overheating and external imbalances in several countries. Sound macroeconomic policies and structural reforms will be necessary to ensure a soft landing in these countries and smooth convergence throughout the region.
Tax incentives have been used extensively in the countries of the Eastern Caribbean Currency Union (ECCU) to promote investment. The associated revenue losses are large, and benefits in terms of new ...investment have been limited, raising doubts about the cost effectiveness of the tax incentive schemes. This paper examines the effects of incentives using the marginal effective tax rate approach (METR), adapting this methodology to the case of a small open economy where the marginal investor is a nonresident. The results show that METRs are high in the region; that there is a large dispersion in the size of METRs across financing source; and that METRs on investment are larger than the overall distortion on capital, with a substantial subsidy to domestic saving. In the presence of tax holidays-the most common incentive scheme in the region-the distortion on capital basically vanishes.
This paper introduces fiscal policy in a model of sovereign risk spreads ("spreads"). Using panel data from emerging market countries, we find that reductions in public expenditure are a more ...powerful tool for reducing spreads than increases in revenues. Specifically, cuts in current spending lower spreads by more than cuts in investment spending, and they also lower spreads by more than increases in revenue. We also show that debt-financed current spending increases sovereign risk by more than tax-financed current spending, suggesting that international investors have some preference for the latter. In line with the empirical literature on the determinants of spreads, we find that liquidity and solvency indicators, as well as macroeconomic fundamentals, are also important determinants of spreads.
In this paper, we examine returns in the Chinese A and B stock markets for evidence of calendar anomalies. We find that both cultural and structural (segmentation) factors play an important role in ...influencing the pricing of both A- and B-shares in China. There is some evidence of a February turn-of-the-year effect, partly owing to the timing of the Chinese Lunar New Year (CNY); and the holiday effect around the CNY period is stronger and more persistent compared with the other public holidays. The segmentation between the two markets is apparent in the day-of-the-week effect, where B stock markets tend to post significant negative returns on Tuesdays, corresponding with overnight developments in the United States, while significant negative returns are observed on Mondays in the A stock markets. Investment strategies based on some of these calendar anomalies, and allowing for transaction costs, suggest that the A stock markets tend to offer more economically significant returns.
An analysis of the buy-vs-lease decision Berlin, Jonathan W; Lexa, Frank J
Journal of the American College of Radiology,
02/2006, Letnik:
3, Številka:
2
Journal Article
Recenzirano
Odprti dostop
This article presents a financial model to analyze the buy-vs-lease decision. The model is constructed from the perspective of a lessee with an operating lease and uses the concept of net present ...value, which calculates the current value of predicted cash flows in the future. Predicted cash flows of an operating lease compared with buying are presented in the model, as is the after-tax borrowing rate, the appropriate discount rate used in a model of this type. The article also discusses nonfinancial factors that may influence the buy-vs-lease decision, including the need for flexibility in working capital and the anticipated technological obsolescence of equipment.
When governments seek private investment
in infrastructure projects, they usually find themselves
asked to provide grants, guarantees, or other forms of
fiscal support. Often they prefer to provide ...support in ways
that limit immediate cash expenditure but sometimes generate
large costs later. Seeking to provide support without any
immediate spending of cash, for example, governments often
agree to shoulder project risks and sometimes encounter
fiscal problems later. For example, in the 1970s and 1980s
in Spain, the government was obliged to pay $2.7 billion
when the exchange-rate guarantees it had given private toll
roads were called (Gomez-Ibanez 1993). More recently, the
Indonesian government agreed to pay $260 million as a result
of its agreements, through the electricity company it owns,
to bear demand and foreign-exchange risks in private power
projects. Yet even when governments have chosen to provide
cash subsidies they have not always achieved their apparent
goals: for example, over 80 percent of the Honduran
government's "lifeline" electricity subsidies
go to customers who aren't poor (Wodon et al. 2003). In
still other cases, governments' decisions not to
provide support may have caused problems.
The main objective of each firm is to achieve an increased profitability, by determining the quantity of the profit. This indicator is not sufficient to assess the degree of efficiency, profitability ...or business profitability. It becomes useful, therefore, through the determination of the financial rates, as these companies provide information about the direction towards the business moves.The financial rates are tools through which firms can make a series of tests and may also determine which strategies to pursue in order to achieve certain objectives.Based on these considerations, the purpose of this study is to determine a number of financial rates specific to the company treasury, having as a reference point the cash flow statements, and to perform an analysis on the obtained results.
