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on Transition Economics |
| By: | Yi Ding (Chinese University of Hong Kong); Wei Xiong (Princeton University and NBER); Jinfan Zhang (Chinese University of Hong Kong) |
| Abstract: | We document issuance overpricing of corporate debt securities in China, which contrasts with underpricing of equity and debt securities in Western countries. The phenomenon in China is robust across subsamples of issuances with different credit ratings, maturities, issuer types, and issuing history, reflecting the distinct institutional environment and issuance process in China’s market for corporate debt securities. The average overpricing dropped from 7.44 basis points to 2.41 basis points after the government prohibited underwriters from using rebates in issuances in October 2017. By analyzing overpricing before and after the rebate ban and across different issuers and underwriters, we uncover two channels for underwriters, who compete for future underwriting business, to drive up overpricing: rebates and self-purchases. |
| Keywords: | Overpricing, New Issues, Corporate Debt Securities, Chinese Market |
| JEL: | G12 G14 G24 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:pri:econom:2021-50&r= |
| By: | Hager, Anselm; Hennicke, Moritz; Krause, Werner; Mergele, Lukas |
| Abstract: | The fall of the Berlin Wall marks one of the largest transformations of the 20th century. At its core, the year 1990 brought two new systems to Eastern Europe: capitalism and democracy. Yet, to this day, Eastern Europeans show distinctly negative attitudes toward the Western world order, and democratic and market institutions across the region are far from perfect. What explains this unsuccessful transformation? This paper points to the rushed privatization of East European economies as one plausible driver of citizens’ discontent with capitalism and democracy. Using micro-level data from East Germany, we show that firm privatizations led to a marked resurgence of the successor of the former Socialist Unity Party as early as 1994. We argue that this effect is likely due to perceived injustice: Socialist voting thrived whenever firms were sold to Western elites, which local residents took as a sign that capitalism is not meritocratic. |
| Date: | 2021–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:cmsyn&r= |
| By: | Janda, Karel; Marek, Petr |
| Abstract: | This paper applies a model of bank run based on game theory analysis of options to the real world case of the Czech retail bank Air Bank a. s. We discuss the main factors affecting the susceptibility of Czech banks to bank run. We estimate the equity value which triggers bank run for Air Bank´s a. s. clients. We also simulate a possible bank run, using a liquidity stress test, which is similar to stress tests used by some European supervisory authorities. We provide alternative estimates of critical value of bank’s equity after the attainment of which depositors withdraw their deposits and by doing so trigger a bank run. |
| Keywords: | Bank run,liquidity,game theory,option pricing |
| JEL: | C72 G01 G21 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:249677&r= |
| By: | Ma, Yuxuan (University of Warwick) |
| Abstract: | This study finds that individuals exposed to an additional 1 μg/m3 airborne particulate matter smaller than 2.5 lead to a statistically significant 0.121 kg/m2 rising of body mass index. This positive relationship is identified by two-stage least square regression using a regression discontinuity estimator of air pollution generated by China’s coal-burning winter heating policy, which only heats for northerners but not for southerners, as the instrument variable. This identification utilizing the quasi-experimental method of regression discontinuity design based on the difference of county’s latitude from both parametric and nonparametric approaches, using different kernel types and bandwidth sizes, with 6000 observations in 2008. Further, the result shows that heating policy caused airborne particulate matter smaller than 2.5 and body mass index significantly increasing in the north and south divided line. These findings not only contribute to the identification of causality between air pollution and obesity but help guide social and environmental policy as well. |
| Keywords: | Airborne particulate matter ; Body mass index ; China ; Central heating policy ; Regression discontinuity JEL Classification: C54 ; I10 ; Q53 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wrkesp:18&r= |
| By: | Lam Do, Truong Phuong (Monash University) |
| Abstract: | This paper examines the subsidy in the retail electricity market from two perspectives: cash transfer and quantity–based subsidy. The cash transfer is measured by three dimensions: benefit incidence, beneficiary incidence, and materiality; The quantity-based subsidy is established under the increasing block rate pricing. Overall, both subsidies are not efficient in supporting the poor. To improve the quantity–based subsidy, three proposals, along with the proposal from the company running the market are examined. The welfare effect under these plans is measured by the change in consumer surplus. Findings from this paper show that the reform should let the first blocks reflect the full marginal cost. Moreover, the price structure should be changed in both marginal price and the intervals. To mitigate the reduction in the quantity–based subsidy, the government should improve the cash transfer by reducing the extortion and targeting more efficiently, especially to poor households who live in rented houses. |
| Keywords: | Vietnam retail electricity market ; block rate pricing ; welfare effect ; electricity externalities ; demand function ; cash transfer ; quantity-based subsidy JEL Classification: D12 ; D63 ;p Q41 ; Q48 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wrkesp:31&r= |
| By: | Jean-Louis Combes (CERDI - Centre d'Études et de Recherches sur le Développement International - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique); Mary-Françoise Renard (CERDI - Centre d'Études et de Recherches sur le Développement International - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique); Shuo Shi (CCES - China Center for Economic Studies, Fudan University) |
| Abstract: | The objective of the paper is to study the relationship between international trade openness and domestic market integration in Late Imperial China. More specifically, we focus on a natural experiment namely the Unequal Treaties of the second half of the nineteenth century that lifted the long-existing international trade restriction system. The integration of domestic markets is analyzed while looking at the existence of a long term common movement in the grain prices between provinces. The econometric results show that trade openness did not lead to better integration of the Chinese domestic grain markets. Our results support the hypothesis according to which long-distance trade has not generated efficiency gains in domestic markets. We evidence a strong segmentation between domestic and international grain markets owing to different traded products and operators. |
| Keywords: | Market integration,Law of one prices,Late Imperial China |
| Date: | 2020–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cdiwps:hal-02619286&r= |
| By: | Akramov, Kamiljon; Carrillo, Lucia; Kosec, Katrina |
| Abstract: | The covid-19 pandemic has had devastating effects globally; it has caused health crises and economic recessions, leading unemployment to spike and disrupting food systems and supply chains. In the heavily remittance-dependent context of Tajikistan, however, migration has continued – and appears to have become increasingly dominated by men. In this context, what has happened to women’s perceptions of economic prospects, as well as the well-being of their households? How has women’s involvement in decision-making evolved? And to what extent do out-migration or in-migration of household members predict changes in women’s decision-making power? We consider these questions using a September – October 2020 phone survey deployed in Khatlon province, Tajikistan that successfully tracked 87% of households that had been surveyed in person in 2018. We find that both genders have similar expectations for their agricultural production (harvests), but women are slightly more likely to identify concerns with rising prices and a lack of access to financial services. Overall, we find little in the way of evidence that women’s involvement in intra-household decision-making declined as a result of the pandemic—though this is from a low base. However, we find that women are less likely than are men to report improvements in women’s decision-making authority. Further, we find that out-migration of household members, which is dominated by men, is associated with improvements in women’s decision-making power, particularly with respect to decisions about how to spend household income. Overall, our results point to the need for additional analyses of the gendered impacts of shocks on women in the Central Asia region. |
| Date: | 2021–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:j7vrm&r= |
| By: | Hyunjeong Hwang; Oliver Roehn |
| Abstract: | Slovakia’s population is ageing rapidly, with the share of the working-age population expected to shrink by about a fifth in the next 30 years. Ageing-related costs are projected to increase much more strongly than in other EU countries and ageing will put pressure on potential growth and living standards. To prepare for an ageing society, pension, health and long-term care, as well as labour market reforms are needed to extend working lives, improve the health of the ageing population, and enhance the efficiency of public spending. Linking the retirement age to life expectancy and tightening early retirement pathways notably for mothers and disability pensioners is important to extend working lives and improve pension sustainability. Health outcome are lagging behind other OECD countries largely due to high preventable mortality, especially among disadvantaged groups, highlighting the importance of a national strategy to reduce preventable mortality, as well as targeted approaches. Measures are also needed to improve the efficiency of health and long-term care spending, notably through reforming the network of hospitals, expanding central procurement of pharmaceuticals, and expanding the supply of in-home long-term care services. Higher employment of older workers is hampered by a range of labour market barriers, including fewer training opportunities, higher job strain, and a lack of flexible working arrangements. Labour participation of mothers with young children is also low, reflecting excessively long parental leave, low financial work incentives, and a lack of childcare facilities. |
| Keywords: | fiscal sustainability, health care system, labour supply, long-term care system, pensions, population ageing |
| JEL: | J11 J26 J08 O52 H55 I11 |
| Date: | 2022–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1701-en&r= |