nep-isf New Economics Papers
on Islamic Finance
Issue of 2020‒12‒07
three papers chosen by
Mohamed Mohamed Tolba Said

  1. Islamic Finance and Anchoring Heuristic Bias: An Analysis to Gulf Islamic Stock Markets By Mustapha Chaffai; Imed Medhioub
  2. Banks, low interest rates, and monetary policy transmission By Wang, Olivier
  3. Impact of the Covid-19 confinement measures on telework in France - A qualitative survey By Francesco Sabato Massimo

  1. By: Mustapha Chaffai (University of Sfax); Imed Medhioub (Imam Muhammad Ibn Saud Islamic University (IMSIU))
    Abstract: This study explores the importance of the 52-week high price in the Islamic GCC stock market returns. We study the anchoring bias of Muslim investors and the important role of the 52-week high price strategy in predicting future returns in the Islamic GCC stock market returns based on new information. For doing this, we have collected data of Islamic GCC companies listed on all sectors of Islamic GCC stock market. Two methods are employed in this paper. The first, interested to the stock price behavior and by using linear regression models, empirical results show that 52- week high price indicator can be considered as a good anchor which used for the prediction of future returns based on new information. The second analysis is interested to anchoring bias in analysts' forecasts. By using variables related to earning per share (EPS) and EPS forecast we conclude that analysts on the GCC market make biased estimates and they tend to anchor to the historical and industry norms. We obtain a negative impact of POSITIVE variable on error forecast indicating then that analysts are more pessimist
    Date: 2020–11–20
  2. By: Wang, Olivier
    Abstract: This paper studies how low interest rates weaken the short-run transmission of monetary policy and contract the long-run supply of bank credit. As U.S. bond rates have fallen, the pass-through of monetary shocks to loan and deposit rates has weakened while the spread on U.S. bank loans has risen. I build a model in which banks earn deposit and loan spreads, deposits compete with money, and banks’ lending capacity depends on their equity. The short-run transmission of monetary policy is dampened at low rates, because deposit spreads act as a better hedge for bank equity against unexpected monetary shocks. In the long run, persistent low rates decrease banks’ “seigniorage” revenue from deposit spreads, hence bank equity and loan supply contract, and loan spreads increase. JEL Classification: E4, E5, G21
    Keywords: deposit spread, financial intermediation, interest rate pass-through, loan spread, low interest rates
    Date: 2020–11
  3. By: Francesco Sabato Massimo (Sciences Po Paris, Centre de sociologie des organisations, CNRS)
    Abstract: During the Covid crisis the population in regime of telework jumped from 3% to 25% of the workforce. This study aims at better understanding how the massive shift to telework following the outbreak of the COVID-19 pandemic affected workers’ jobs and lives in France during the first lockdown (March 17th-May 11th 2020). In particular, we shed light on how this exogenous change had an impact on tasks content and work organisation dimensions like teamwork, routine, workers’ autonomy and types and extent of supervisory controls method. Moreover, we dig into both subjective and objective dimensions of job quality such as job satisfaction, motivation, changes in working time and pay, together with issues related to physical and mental health and more generally to work-life balance. The picture that emerges is quite fragmented, largely depending on workers’ occupation and family composition, although some general patterns could be observed. First, the transition to telework did not affected the structural inequality of the occupational structure: respondents accomplishing low skilled and standardised tasks enjoyed, to a certain extent, more freedom from direct control, whereas interviewees on less standardised and more autonomous tasks were more able to carve out some niches of independence in the new situation and were more able to resist management pressures for more control and standardization. Second, most organisations had no specific policies dedicated to teleworking and workers had to adapt to the new situation without any special guideline: horizontal cooperation emerges as driver of adaptation as important as vertical control, if not more. Third, the positive aspect that was noticed by the large majority of respondents was the opportunity that telework gave them to experiment a more flexible management of time, at least for those who could tinker with their working time schedule. Fourth, and especially for that reason, the overwhelming majority of respondents wishes to consolidate the practice of telework also after the end of the lockdown and with more continuity.
    Keywords: Covid-19, Telework, Quality of Work, Management and Workers Power, Labour Process, Employment Relations, Work-Life Balance.
    Date: 2020–11

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