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1 – 10 of over 3000Jyoti Parikh and Probal P. Ghosh
India aspires for high economic growth of around 8‐9 percent over next few years. Higher economic growth would lead to higher production and consumption, more energy use and more…
Abstract
Purpose
India aspires for high economic growth of around 8‐9 percent over next few years. Higher economic growth would lead to higher production and consumption, more energy use and more CO2 emissions. At a time when CO2 emissions reductions are becoming an important point of debate and fast erosion of fossil fuel reserves all over the world, it is necessary to identify technological choices that reduce CO2 emission and dependence on fossil fuels. A few modeling studies have explored India's technology options. The Integrated Energy Policy (IEP) report of the Planning Commission of India presents different scenarios for energy supply. The IEP model is however an energy technology model and does not consider a feed back into the economy due to changes in technological choice. This paper aims to follow the IEP in the kind of scenario's envisaged and attempts to investigate its macro‐economic impacts.
Design/methodology/approach
The Integrated Research and Action for Development model is an activity analysis model that uses a social accounting matrix to account for inter‐sectoral influence and which allows for a two‐way interaction between energy sectors (coal, oil, natural gas, and electricity) and other sectors of the economy. This paper tries to have three scenarios that are comparable to IEP in terms of specifications and their resultant energy demand (Mtoe).
Findings
The analyses prove that changing technological choice results in gross domestic product gains, and reduction in energy demand and CO2 emission. The results show that the policies considered can have adverse welfare impacts.
Originality/value
This paper helps in providing an insight into the macro‐economic impacts of the IEP scenarios. The two‐way dependence of technological choice and output shows the gains and loses out of moving to more costlier but low emission‐based power generation technology.
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Hassan Tanha and Michael Dempsey
The purpose of this paper is to assign fair values to options reduces to the attempt to attribute correct implied volatilities. Here, the authors extend the study by Tanha et al.…
Abstract
Purpose
The purpose of this paper is to assign fair values to options reduces to the attempt to attribute correct implied volatilities. Here, the authors extend the study by Tanha et al. (2014) to determine the impact of macro economic announcements on the option smile.
Design/methodology/approach
First, the authors estimate the implied volatility function in terms of moneyness. The authors next analyse the impact of macroeconomic announcements on the estimated coefficients (b 0, b 1, b 2) by regressing the coefficients on the macroeconomic announcements.
Findings
The authors find that in-the-money options are sensitive to such announcements, but that out-of-the money options are not. This is consistent with the interpretation of investor behaviour from prospect theory.
Originality/value
The systematic pricing errors that have been documented using the Black-Scholes model have stimulated attempts to improve the model predictions. The approach uses DVF model to improve the B-S model.
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The housing finance market in Ghana is highly underdeveloped. This may be as a result of unfriendly or poor regulatory environment. This paper seeks to examine the regulatory…
Abstract
Purpose
The housing finance market in Ghana is highly underdeveloped. This may be as a result of unfriendly or poor regulatory environment. This paper seeks to examine the regulatory environment and to determine its impact on the development of the formal housing finance market in the country.
Design/methodology/approach
The paper executes this by surveying the housing finance literature. It also carries out a review of the legal framework of the country's mortgage market.
Findings
It is found that inadequate foreclosure rights of lenders before December 2008 constrained the development of the formal housing finance market in Ghana. The research notes that the enactment of the Home Mortgage Finance Act, 2008 (Act 770) in December 2008 has created a conducive legal environment for collateralised lending in the country. This has improved the prospects of developing the housing finance market in the country.
Practical implications
It is noted that a credit bureau industry and mortgage refinancing mechanisms must be put in place if the Act 770, 2008 is to facilitate mortgage market development in the country. It recommends additional policy and institutional reforms.
Originality/value
The paper identifies the legal and institutional constraints on housing finance market development in Ghana.
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Roberta Serafini and Melanie Ward
Over recent decades both Europe and the United States have experienced an increase in the share of service-related jobs in total employment. Although narrowing in all European…
Abstract
Over recent decades both Europe and the United States have experienced an increase in the share of service-related jobs in total employment. Although narrowing in all European countries, a significant gap in the share of service jobs relative to the United States still persists. The aim of the chapter is to identify the main drivers of the service sector employment share in the EU-15 as well as its gap relative to the United States. The analysis is carried out for the aggregate service sector, 4 sub-sectors and 12 service sector branches over the period 1970–2003. We find some evidence to support the hypothesis that a number of labour market regulations – such as union density and the degree of centralisation of wage bargaining – together with the mismatch between workers' skills and job vacancies, have affected Europe's ability to adjust efficiently to the reallocation of labour from manufacturing into services. Furthermore, we find significant heterogeneity in the relative weight of the various determinants of the employment share across sub-sectors and branches.
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Thierry Vanelslander, Gilles Chomat, Athena Roumboutsos and Géraldine Bonnet
The purpose of this paper is to present a methodology of comparing concession projects developed in different transport sub-sectors. The methodology is tested in the comparison of…
Abstract
Purpose
The purpose of this paper is to present a methodology of comparing concession projects developed in different transport sub-sectors. The methodology is tested in the comparison of three different cases, each of which represent a particular mode of transport: a road development project, a city tramway project and a port lock construction initiative.
Design/methodology/approach
A fuzzy logic approach methodology is applied in carrying out the comparison between cases. Granulation is achieved by employing a Contextual (Ws) Risk Analysis Framework, as risks constitute the basis to public private partnership (PPP) structure. Linguistic variables are then used to describe the comparative findings.
Findings
The methodology presented allows for the comparison of three cases from different transport sub-sectors. Identification of similarities provides the potential to transfer experience from one sector to the other. With respect to the three cases studied, it was identified that traffic risk seems to be passed on to the private operators in relation to the level of exclusivity. Finally, PPP projects initiated by central government (as opposed to those initiated by local governments) seem to be more finance-driven than service-driven.
Research limitations/implications
As the number of cases to be compared increases, quantitative comparative analysis fuzzy set values can be included in order to carry out a full analysis. The present approach should be considered introductory, as fuzzy sets are not generated due to the limited number of surveys (cases) compared (hence the term “pre-fuzzy”).
Practical implications
The methodology presented and the cases tested indicate the possibility for knowledge/experience transfer and the transferability of best practices.
Originality/value
Cross-sub-sectoral comparisons for transport PPP projects have not been identified in literature.
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Abdelmoneim A. Awadallah and Haitham M. Elsaid
The study aims at examining whether or not poor macro-economic conditions can lead auditors to change their risk management policies when performing an audit.
Abstract
Purpose
The study aims at examining whether or not poor macro-economic conditions can lead auditors to change their risk management policies when performing an audit.
Design/methodology/approach
The present study is based on a questionnaire distributed to auditors working at the branches of the big four audit firms in Egypt over two rounds under different economic conditions. The responses in each of the two rounds were analyzed to identify any similarities or differences in auditors' behavior when performing analytical procedures under different economic conditions.
Findings
Auditors appear to alter their risk management strategies during challenging economic times. The present study results suggest that auditors increase their dependence on non-financial data and information as supporting evidence when assessing audit risk during times of economic difficulties. The findings also show that when the macro-economic trends are declining, audit firms tend to assign the performance of analytical procedures to more experienced audit personnel (i.e. senior auditors, audit managers and partners) with less of this work being done by the audit staff.
Research limitations/implications
The present study is based on a sample of 40 respondents. It is recommended for future research to use a larger sample size as results may differ for a greater sample. The present research did not consider the effect of auditors' specialization in a certain industry on the audit judgment during an audit engagement. Future research would examine the impact of auditors' industry specialization on audit judgments during periods of unfavorable economic conditions. The present study is based on a survey that aims at capturing auditors' perception. Further research would use other research techniques (e.g. laboratory experiment) to examine the effect of the general economic conditions on auditors' assessment of audit risk.
Practical implications
Auditors need to give sufficient attention to the analyses of non-financial information of their audit clients during the performance of the analytical procedures under unstable economic conditions rather than depending solely on financial information. Moreover, audit firms could use a much richer labor mix for audit teams through increasing their reliance on experienced senior auditors, audit managers and partners during periods of deteriorating macro-economic conditions to mitigate risk and improve audit judgment.
Originality/value
This study adds to the scarce literature in developing countries investigating the influence of external economic factors on the audit process. The present research provides information to practitioners and educators about risk management policies that could be considered in case of performing analytical procedures during an audit conducted under poor economic conditions.
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The purpose of the paper is to report on a novel approach to assessing long‐term policy and technology impacts. This approach combines a qualitative forecast with a tri‐level…
Abstract
Purpose
The purpose of the paper is to report on a novel approach to assessing long‐term policy and technology impacts. This approach combines a qualitative forecast with a tri‐level quantitative projection to provide a broadly socio‐economic analysis. It is aimed at forecasting problems, such as impact assessment for future policy formulation in the light of socio‐economic, technological and market developments.
Design/methodology/approach
The paper is based on a variety of research methods including scenario planning, and techniques taken from analysis of stochastic processes to identify and correlate behaviour, combined with the concepts meso‐economics, in order to produce more robust tri‐level quantitative estimations, driven by qualitative analysis.
Findings
The paper finds that it is possible to join micro‐economic behaviour to macro‐economic, using meso‐economics to attack what was previously seen as a difficult gap between the two. It also finds that quantitative forecasting, based on socio‐economic behaviour using the qualitative assessment from a scenario – i.e. from stories about the future – can form a basis for quantitative forecasting. Different scenarios may be linked to corresponding quantitative economic estimations using key indicator parameters at each economic level, those which are the most relevant to the scenarios, and so exploit statistical techniques across the three levels in a balanced fashion.
Originality/value
This paper summarises a novel approach, taking a fresh look at forecasting economic impacts assessments by shaping the quantitative form with a qualitative tool, while introducing the linking powers of meso‐economics. General economic theories in widespread use today seem to be weak when dealing with the non‐deterministic nature of real markets and economies and especially in linking micro‐economic parameters to macro‐economic. The approach attempts to resolve this dilemma. An example is presented of its use in a recent study.
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This paper aims to understand the issue of interest rate benchmarking in Islamic financial institutions (IFIs) from a macro-economic perspective and assessing the relevance of…
Abstract
Purpose
This paper aims to understand the issue of interest rate benchmarking in Islamic financial institutions (IFIs) from a macro-economic perspective and assessing the relevance of creating a Sharīʿah-compliant profit rate benchmark to solve this issue. This paper also aims at suggesting an Islamic alternative that will handle both the negative economic impact on IFIs as well as on their financial performance.
Design/methodology/approach
The paper is based on literature review of conventional finance and Islamic finance theories to construct a theoretical model to assess the impact of interest rate benchmarking on the ability of IFIs to achieve the objectives of the Islamic economy.
Findings
The macro-economic perspective concludes that conceiving a profit rate benchmark for the Islamic finance industry is not relevant to raising the Sharīʿah credibility of the industry. Indeed, several adjustments need to be introduced in terms of the business model.
Research limitations/implications
The recommendations of this paper require the involvement of financial authorities and governments for their implementation. Indeed, the adjustments require a macro-economic review.
Practical implications
The paper considers a profit rate benchmark irrelevant and inefficient. Instead, it suggests the necessary adjustments in terms of business model and economic approach for IFIs to achieve their objectives.
Social implications
The paper considers zakat implementation and the adjustment of IFIs as the real path to implement a fair wealth distribution in the society.
Originality/value
The creation of a profit rate benchmark has always been the only solution for the pricing issue in IFIs. This paper challenges this idea and tries to give a deeper understanding of the situation.
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Cedric Pugh and Alireza Dehesh
Since 1980, property cycles have emerged emphatically as a phenomenon of urban development in both developed and developing countries. Among the many things which need to be…
Abstract
Since 1980, property cycles have emerged emphatically as a phenomenon of urban development in both developed and developing countries. Among the many things which need to be explained is the continuing high levels of financial investment in property sectors, even well past the time when supply exceeds demand and vacancy rates continue to grow. Various intellectuals have put forward new theories and some situational explanations of the periodic over‐capitalisation in property. The economic adversities are not confined to the property and finance sectors. They extend into the socio‐economic performance of national economies, and in some cases they have international linkages and impacts. Gives exposition and evaluation relating to cyclicity in the USA, the UK, Japan, and some developing countries in Asia. The aim is mainly centred on explanation and theory, extending earlier published work in the authors’ research programmes in property cycles, urban development, and experience in both developing and developed countries. The economic, social, and political significance of property cycles is enormous.
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The dividend payout behaviour of firms is a well‐studied subject in finance. In recent times, the influence of macro economic factors and understanding their implications far…
Abstract
Purpose
The dividend payout behaviour of firms is a well‐studied subject in finance. In recent times, the influence of macro economic factors and understanding their implications far corporate financial decisions has assumed significant importance. The objective of this paper is to study the dividend payout behaviour of firms in India under monetary policy restrictions. Monetary policy restrictions are expected to affect the availability and cost of external fund relative to internal funds. The hypothesis is that during monetary policy restrictions the dividend payout policy changes and payouts reduce.
Design/methodology/approach
The Lintner framework is extended to examine the impact of these restrictions on the dividend payout. Balanced panel data of 571 firms for years are used, from 1989 to 1997 together with, the GMM estimator, which is the most suitable methodology in a dynamic setting.
Findings
The results show that Indian firms have lower target ratios and higher adjustment factors. The finding suggests that the restricted monetary policies have a significant influence on the dividend payout behaviour of Indian firms; they cause about a 5‐6 per cent reduction in the payout ratios.
Research limitations/implications
The findings of this paper suggest that macro‐economic policies do have an impact on corporate financing decisions. The future research should examine the impact of various other macro‐economic policies and its components on the corporate financing decisions of firms.
Practical implications
The significance of the macro economic policy variables suggests that monetary policy restrictions do have an impact on the cost of raising funds, and the information asymmetry between lenders and borrowers increases, which forces companies to reduce their dividend payout.
Orginality/value
To one's knowledge this is the first study providing evidence of the restricted monetary policy constraining the dividend payout policies of firms in India.
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