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Article
Publication date: 20 April 2020

Bowen Jia, Jiaying Wu, Juan Du, Yun Ji and Lina Zhu

The purpose of this paper is to calculate the local guaranteed fiscal revenue with the local fiscal revenue of 31 provinces, and predict their guaranteed fiscal revenue in…

Abstract

Purpose

The purpose of this paper is to calculate the local guaranteed fiscal revenue with the local fiscal revenue of 31 provinces, and predict their guaranteed fiscal revenue in 2018 with the artificial neural network (ANN).

Design/methodology/approach

The principal components analysis (PCA), particle swarm optimization (PSO) and extreme learning machine (ELM) model was designed to produce the inputs of KMV model. Then the KMV model was used for obtaining the default probabilities under different issuance scales. Data were collected from Wind Database. MATLAB 2018b and SPSS 22 were used in the field of modeling and results analysis.

Findings

This study’s findings show that PCA–PSO–ELM proposed in this research has the highest accuracy in terms of the prediction compared with ELM, back propagation neural network and auto regression. And PCA–PSO–ELM–KMV model can calculate the secure issuance scale of local government bonds effectively.

Practical implications

The sustainability forecast in this study can help local governments effectively control the scale of debt issuance, strengthen the budget management of local debt and establish the corresponding risk warning mechanism, which could make local governments maintain good credit ratings.

Originality/value

This study sheds new light on helping local governments avoid financial risks effectively, and it is conducive to establish a debt repayment reserve system for local governments and the proper arrangement for stock debt.

Details

Kybernetes, vol. 50 no. 5
Type: Research Article
ISSN: 0368-492X

Keywords

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Book part
Publication date: 4 December 2018

Indranarain Ramlall

Abstract

Details

The Corporate, Real Estate, Household, Government and Non-Bank Financial Sectors Under Financial Stability
Type: Book
ISBN: 978-1-78756-837-2

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Article
Publication date: 1 May 1997

Anghel N. Rugina

The equation of unified knowledge says that S = f (A,P) which means that the practical solution to a given problem is a function of the existing, empirical, actual…

Abstract

The equation of unified knowledge says that S = f (A,P) which means that the practical solution to a given problem is a function of the existing, empirical, actual realities and the future, potential, best possible conditions of general stable equilibrium which both pure and practical reason, exhaustive in the Kantian sense, show as being within the realm of potential realities beyond any doubt. The first classical revolution in economic thinking, included in factor “P” of the equation, conceived the economic and financial problems in terms of a model of ideal conditions of stable equilibrium but neglected the full consideration of the existing, actual conditions. That is the main reason why, in the end, it failed. The second modern revolution, included in factor “A” of the equation, conceived the economic and financial problems in terms of the existing, actual conditions, usually in disequilibrium or unstable equilibrium (in case of stagnation) and neglected the sense of right direction expressed in factor “P” or the realization of general, stable equilibrium. That is the main reason why the modern revolution failed in the past and is failing in front of our eyes in the present. The equation of unified knowledge, perceived as a sui generis synthesis between classical and modern thinking has been applied rigorously and systematically in writing the enclosed American‐British economic, monetary, financial and social stabilization plans. In the final analysis, a new economic philosophy, based on a synthesis between classical and modern thinking, called here the new economics of unified knowledge, is applied to solve the malaise of the twentieth century which resulted from a confusion between thinking in terms of stable equilibrium on the one hand and disequilibrium or unstable equilibrium on the other.

Details

International Journal of Social Economics, vol. 24 no. 5
Type: Research Article
ISSN: 0306-8293

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Article
Publication date: 2 June 2021

HyunJun Na

The purpose of this paper is to investigate how the innovative firm’s proprietary information has an impact on its debt financing preference. This study also examines the…

Abstract

Purpose

The purpose of this paper is to investigate how the innovative firm’s proprietary information has an impact on its debt financing preference. This study also examines the impact of industry-level competition on the debt financing orders and investigates how two exogenous shocks impacted on innovative firms’ financing policies.

Design/methodology/approach

This paper uses the three types of debt data, including bonds, private debt placements and bank loans and patent application data, in the USA from 1987–2008. The number of patents applications and industry-level competition are used as proxies for a firm’s innovation and industry-level sensitivity. In addition, to minimize endogenous concern, this study uses the propensity score matching analysis and difference-in-differences.

Findings

The patents are the primary determinants for innovative firms to choose the debt types. The paper shows that innovative firms have the debt preference order – public debt, private placement and bank loans. However, as competition increases, innovative firms devise the order reverse. Finally, the paper provides evidence that the American Inventor’s Protection Act (AIPA) and the tech bubble crash made investors depend more on firms with more patents.

Originality/value

This paper is the first to study the impact of the AIPA on innovative firms’ financial policies using the propensity score matching analysis. The findings imply that both patents and industry-level competition are important factors to understand the capital structures for innovative firms.

Details

Studies in Economics and Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1086-7376

Keywords

Content available
Article
Publication date: 14 August 2020

Imene Guermazi

This paper focuses on Ṣukūk issuance determinants in Gulf Cooperation Council (GCC) countries. Given the dual characteristic of debt and equity of Ṣukūk as well as their…

Abstract

Purpose

This paper focuses on Ṣukūk issuance determinants in Gulf Cooperation Council (GCC) countries. Given the dual characteristic of debt and equity of Ṣukūk as well as their unique benefits of social responsibility, the author questions whether the theories of capital structure, the trade-off and the pecking order are able to well explain the Ṣukūk issuance.

Design/methodology/approach

First, the author verifies these theories using capital structure determinants and regresses the Ṣukūk change on these determinants. Second, the author tests the trade-off theory with the target debt model and third, verifies the pecking order theory using the fund flow deficit model.

Findings

The empirical results show that capital structure determinants fail to explain both theories. The author confirms that the Ṣukūk change is significatively linked to the deviation from a Ṣukūk target. So, issuing firms balance the marginal costs of Ṣukūk and their benefits of religiosity and social responsibility toward a target debt. The author finds no evidence of the pecking order theory.

Research limitations/implications

This study contributes to corporate finance theory and corporate social responsibility. It verifies if capital structure theories proved in conventional financing can well explain Islamic bonds issuance given their social responsibility benefits.

Practical implications

Managers and investors would pay attention to the social factors explaining Ṣukūk issuance in their finance and investment decisions. They would be enhanced to use this financing tool knowing its social unique benefits. This also should encourage governments to enhance this socially responsible financing. Rating agencies would be motivated to evaluate Ṣukūk and firms would improve the quality and relevance of disclosure to get the best rating.

Social implications

The author highlights the social factors explaining Ṣukūk issuance and enhances corporate social responsibility (CSR).

Originality/value

The author extends the few literature testing capital structure theories for Islamic bonds and highlights the specific social responsible features of Ṣukūk that would bridge their issuance to capital structure theories. So the author enhances the concept of Islamic CSR. Tying capital structure theories to CSR would also help developing Islamic finance theory as a unique social responsible framework.

Details

Islamic Economic Studies, vol. 28 no. 1
Type: Research Article
ISSN: 1319-1616

Keywords

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Article
Publication date: 1 March 2013

John F. Sacco and Gerard R. Busheé

This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the…

Abstract

This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the audited end of year financial reports for thirty midsized US cities. The analysis focuses on whether and how quickly and how extensively revenue and spending directions from past years are altered by recessions. A seven year series of Comprehensive Annual Financial Report (CAFR) data serves to explore whether citiesʼ revenues and spending, especially the traditional property tax and core functions such as public safety and infrastructure withstood the brief 2001 and the persistent 2007 recessions? The findings point to consumption (spending) over stability (revenue minus expense) for the recession of 2007, particularly in 2008 and 2009.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 25 no. 3
Type: Research Article
ISSN: 1096-3367

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Expert briefing
Publication date: 2 March 2021

The Bank of Ghana (BoG) has bought up unprecedented levels of treasury bonds but now wants to scale back its role. Finance Minister Ken Ofori-Atta is looking to…

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Book part
Publication date: 8 November 2010

Jonathan A. Batten, Warren P. Hogan and Peter G. Szilagyi

We consider recent events in financial markets and the subsequent responses by monetary and fiscal authorities, which are impressive for their scale, innovation and…

Abstract

We consider recent events in financial markets and the subsequent responses by monetary and fiscal authorities, which are impressive for their scale, innovation and flexibility in the face of sharply deteriorating circumstances. Internationally, the economic malaise brought perverse responses not least being the apparent quest for higher capital adequacy requirements than was thought necessary before the downturn. Where possible the uniqueness of the responses by authorities in the Asia-Pacific region is highlighted. Other features impeding recovery cannot be dealt with immediately. Among these, the most important is the valuation procedures associated with accounting rules.

Details

International Banking in the New Era: Post-Crisis Challenges and Opportunities
Type: Book
ISBN: 978-1-84950-913-8

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Article
Publication date: 11 January 2019

Elena Precourt

The purpose of this paper is to examine the section of the Jumpstart Our Business Startups (JOBS) Act related to information dissemination by sell-side security analysts…

Abstract

Purpose

The purpose of this paper is to examine the section of the Jumpstart Our Business Startups (JOBS) Act related to information dissemination by sell-side security analysts. The paper analyzes how the abolishment of the quiet period requirements for emerging growth companies (EGCs) changes the analyst initiation timing and market expectation of and reaction to the issuance of the analyst recommendations.

Design/methodology/approach

This paper considers the effect of the abolishment of the quiet period requirements on analyst coverage initiations for EGCs with IPOs between January 2006 and December 2015 using regression analyses and probability models.

Findings

The results confirm the current anecdotal and empirical evidence that a shorter, de facto, quiet period exists. Analyst issue stronger average ratings for EGCs than for similar firms with IPOs before the JOBS Act. EGCs with initiations from multiple analysts also experience stronger positive market reaction than the firms with initial offerings before the JOBS Act. The market seems to anticipate which EGCs will have initiations and particularly which EGCs will have initiations from multiple analysts. The investors, however, do not fully anticipate the strength of actual recommendations.

Practical implications

This paper is important for researchers, practitioners and policy-makers to understand how analysts impact the financial markets, how timing of analyst initiations affects stock prices of EGCs and what firm characteristics play a role in securing analyst coverage shortly after initial offerings.

Originality/value

This paper adds to the emerging literature on consequences of and changes brought by the JOBS Act. Specifically, this paper extends the limited literature on analyst initiations issued for firms with IPOs following the JOBS Act, timing of those initiations and magnitude of the market’s response to the initiations.

Details

Journal of Financial Regulation and Compliance, vol. 27 no. 1
Type: Research Article
ISSN: 1358-1988

Keywords

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Abstract

Details

Transforming Information Security
Type: Book
ISBN: 978-1-83909-928-1

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