Political Risk in Credit Evaluation: Empirical Studies and Survey Results

Financing trade between economic agents located in different countries is affected by many types of risks, resulting from incomplete information about the debtor, the problems of enforcing international contracts, or the prevalence of political and financial crises. Trade is important for economic development and the availability of trade finance is essential, especially for developing countries. Relatively few studies treat the topic of political risk, particularly in the context of international lending. This thesis explores new ground to identify links between political risk and international debt defaults. The core hypothesis of the study is that the default probability of debt increases with increasing political risk in the country of the borrower. The thesis consists of three essays that support the hypothesis from different angles of the credit evaluation process. The first essay takes the point of view of an international lender assessing the credit risk of a public borrower. The second investigates creditworthiness assessment of companies. The obtained results are substantiated in the third essay that deals with an extensive political risk survey among finance professionals in developing countries. The financial instruments of core interest are export credit guaranteed debt initiated between the Export Credit Agency of Finland and buyers in 145 countries between 1975 and 2006. Default events of the foreign credit counterparts are conditioned on country-specific macroeconomic variables, corporate-specific accounting information as well as political risk indicators from various international sources. Essay 1 examines debt issued to government controlled institutions and conditions public default events on traditional macroeconomic fundamentals, in addition to selected political and institutional risk factors. Confirming previous research, the study finds country indebtedness and the GDP growth rate to be significant indicators of public default. Further, it is shown that public defaults respond to various political risk factors. However, the impact of the risk varies between countries at different stages of economic development. Essay 2 proceeds by investigating political risk factors as conveivable drivers of corporate default and uses traditional accounting variables together with new political risk indicators in the credit evaluation of private debtors. The study finds links between corporate default and leverage, as well as between corporate default and the general investment climate and measeures of conflict in the debtor country. Essay 3 concludes the thesis by offering survey evidence on the impact of political risk on debt default, as perceived and experienced by 103 finance professionals in 38 developing countries. Taken together, the results of the thesis suggest that various forms of political risk are associated with international debt defaults and continue to pose great concerns for both international creditors and borrowers in developing countries. The study provides new insights on the importance of variable selection in country risk analysis, and shows how political risk is actually perceived and experienced in the riskier, often lower income countries of the global economy.

Relocating the American Dream : The America of the 1960s as Portrayed by the New Journalists Norman Mailer, Hunter S. Thompson, and Tom Wolfe

The concept of the American Dream was subject to a strong re-evaluation process in the 1960s, as counterculture became a prominent force in American society. A massive generation of young people, moved by the Vietnam War, the hippie movement, and psychedelic experimentation, created substantial social turbulence in their efforts to break out of conventional patterns and to create a new kind of society. This thesis outlines and analyses the concept of the American Dream in popular imagination through three works of new journalism. My primary data consists of Tom Wolfe’s The Electric Kool-Aid Acid Test (1967), Hunter S. Thompson’s Fear and Loathing in Las Vegas: A Savage Journey to the Heart of the American Dream (1971), and Norman Mailer’s Armies of the Night: History as a Novel, the Novel as History (1968). In defining the American Dream, I discuss the history of the concept as well as its manifestations in popular culture. Because of its elusive and amorphous nature, the concept of the American Dream can only be examined in cultural texts that portray the values, sentiments, and customs of a certain era. I have divided the analytical section of my thesis into three parts. In the first part I examine how the authors discuss the American society of their time in relation to ideology, capitalism, and the media. In the second part I focus on the Vietnam War and the controversy it creates in relation to the notions of freedom and patriotism. In the third part I discuss how the authors portray the countercultural visions of a better America that challenged the traditional interpretations of the American Dream. I also discuss the dark side of the new dream: the problems and disillusions that came with the effort to change the world. This thesis is an effort to trace the relocation of the American Dream in the context of the 1960s counterculture and new journalism. It hopes to provide a valuable addition to the cultural history of the sixties and to the effort of conceptualizing the American Dream.

Oxidative stability of phytosterols in food models and foods

An important safety aspect to be considered when foods are enriched with phytosterols and phytostanols is the oxidative stability of these lipid compounds, i.e. their resistance to oxidation and thus to the formation of oxidation products. This study concentrated on producing scientific data to support this safety evaluation process. In the absence of an official method for analyzing of phytosterol/stanol oxidation products, we first developed a new gas chromatographic - mass spectrometric (GC-MS) method. We then investigated factors affecting these compounds' oxidative stability in lipid-based food models in order to identify critical conditions under which significant oxidation reactions may occur. Finally, the oxidative stability of phytosterols and stanols in enriched foods during processing and storage was evaluated. Enriched foods covered a range of commercially available phytosterol/stanol ingredients, different heat treatments during food processing, and different multiphase food structures. The GC-MS method was a powerful tool for measuring the oxidative stability. Data obtained in food model studies revealed that the critical factors for the formation and distribution of the main secondary oxidation products were sterol structure, reaction temperature, reaction time, and lipid matrix composition. Under all conditions studied, phytostanols as saturated compounds were more stable than unsaturated phytosterols. In addition, esterification made phytosterols more reactive than free sterols at low temperatures, while at high temperatures the situation was the reverse. Generally, oxidation reactions were more significant at temperatures above 100°C. At lower temperatures, the significance of these reactions increased with increasing reaction time. The effect of lipid matrix composition was dependent on temperature; at temperatures above 140°C, phytosterols were more stable in an unsaturated lipid matrix, whereas below 140°C they were more stable in a saturated lipid matrix. At 140°C, phytosterols oxidized at the same rate in both matrices. Regardless of temperature, phytostanols oxidized more in an unsaturated lipid matrix. Generally, the distribution of oxidation products seemed to be associated with the phase of overall oxidation. 7-ketophytosterols accumulated when oxidation had not yet reached the dynamic state. Once this state was attained, the major products were 5,6-epoxyphytosterols and 7-hydroxyphytosterols. The changes observed in phytostanol oxidation products were not as informative since all stanol oxides quantified represented hydroxyl compounds. The formation of these secondary oxidation products did not account for all of the phytosterol/stanol losses observed during the heating experiments, indicating the presence of dimeric, oligomeric or other oxidation products, especially when free phytosterols and stanols were heated at high temperatures. Commercially available phytosterol/stanol ingredients were stable during such food processes as spray-drying and ultra high temperature (UHT)-type heating and subsequent long-term storage. Pan-frying, however, induced phytosterol oxidation and was classified as a rather deteriorative process. Overall, the findings indicated that although phytosterols and stanols are stable in normal food processing conditions, attention should be paid to their use in frying. Complex interactions between other food constituents also suggested that when new phytosterol-enriched foods are developed their oxidative stability must first be established. The results presented here will assist in choosing safe conditions for phytosterol/stanol enrichment.

Moral Professionalism in Interaction : Educators' Relational Moral Voices in Urban Schools

The aim of this study was to investigate educators relational moral voices in urban schools and to listen to what they told about moral professionalism and moral practices in challenging urban schools. Their relational moral voices were investigated through the following three questions: 1. What are the educators moral voices in relation to themselves and other people? 2. What are the educators moral voices in relation to their work and society? 3. What kind of interaction process lies between the educators moral voices and the urban school context? The research data of this study were gathered in four urban schools in Jyväskylä and Helsinki. The research schools were chosen for this study according to the criteria of the international Socrates Comenius project called Leading Schools Successfully in Challenging Urban Context: Strategies for Improvement. This study formed part of this project, which investigated successful urban schools as challenging learning environments in nine European countries and explored the principals success in leadership in particular. The data, which included 37 narratively constructed interviews with four principals and key informants selected by the principals, were gathered in interviews conducted in 2006. In other words, the data comprised three interviews with each of four principals, and interviews with two teachers, two parents, and two pupils from each school. In addition, the school deacon from one school was also interviewed. Furthermore, part of the data from one of the research schools included a medium report of the school deacon s work. This study combined the case study method, the narrative approach and the critical incident technique as the methodological framework. In addition, all of these methods served as practical tools for both analyzing and reporting the data. The educators' narrations and the results of the study appear in the original articles (Hanhimäki & Tirri 2008; Hanhimäki 2008b; Hanhimäki & Tirri 2009; Hanhimäki 2008a). The educators moral voices in relation to themselves and other people emerged through the main themes of moral leadership, the development and evaluation process, moral sensitivity, gender, values, and student well-being. The educators moral voices in relation to their work and society emerged through the main themes of multiprofessional cooperation, families and parental involvement, and moral school culture. The idea of moral interaction connected moral professionalism and the methodological combination of this study, which together emphasized social interaction and the creation of understanding and meaning in this interaction. The main point of this study was to state that the educators moral voices emerged in the interaction between the educators themselves and the urban school context. In this interaction, the educators moral professionalism was constructed and shaped in relation to themselves, other people, their work and society. The loudest relational moral voices heard through the main themes were those of caring, cooperation, respect, commitment, and professionalism. When the results were compared to the codes of ethics which guided these educators moral professional work, the ethical principles and values of the codes were clearly visible in their moral practices. The loudest message from the educators narration could be summarized in the words caring, respect and cooperation: at its best, there is just a human being and a human being with caring, respect and cooperation between them. The results of this study emphasize the need for practical approaches such as case studies and the narrative approach in teacher education to encourage educators to become moral professionals capable of meeting the needs of people of varied backgrounds. In addition, opportunities for moral, religious and spiritual education should be noticed and utilized in the plural interaction of urban schools when nurturing pupils and creating a moral school culture. Furthermore, multiprofessional cooperation and parents as the school s primary cooperation partner are needed to carry out the shared duty of moral education in urban schools. Keywords: moral professionalism, educator, relational moral voice, interaction, urban school

Evaluation and modelling of the spatial and temporal variability of particulate matter in urban areas

This thesis contains three subject areas concerning particulate matter in urban area air quality: 1) Analysis of the measured concentrations of particulate matter mass concentrations in the Helsinki Metropolitan Area (HMA) in different locations in relation to traffic sources, and at different times of year and day. 2) The evolution of traffic exhaust originated particulate matter number concentrations and sizes in local street scale are studied by a combination of a dispersion model and an aerosol process model. 3) Some situations of high particulate matter concentrations are analysed with regard to their meteorological origins, especially temperature inversion situations, in the HMA and three other European cities. The prediction of the occurrence of meteorological conditions conducive to elevated particulate matter concentrations in the studied cities is examined. The performance of current numerical weather forecasting models in the case of air pollution episode situations is considered. The study of the ambient measurements revealed clear diurnal variation of the PM10 concentrations in the HMA measurement sites, irrespective of the year and the season of the year. The diurnal variation of local vehicular traffic flows seemed to have no substantial correlation with the PM2.5 concentrations, indicating that the PM10 concentrations were originated mainly from local vehicular traffic (direct emissions and suspension), while the PM2.5 concentrations were mostly of regionally and long-range transported origin. The modelling study of traffic exhaust dispersion and transformation showed that the number concentrations of particles originating from street traffic exhaust undergo a substantial change during the first tens of seconds after being emitted from the vehicle tailpipe. The dilution process was shown to dominate total number concentrations. Minimal effect of both condensation and coagulation was seen in the Aitken mode number concentrations. The included air pollution episodes were chosen on the basis of occurrence in either winter or spring, and having at least partly local origin. In the HMA, air pollution episodes were shown to be linked to predominantly stable atmospheric conditions with high atmospheric pressure and low wind speeds in conjunction with relatively low ambient temperatures. For the other European cities studied, the best meteorological predictors for the elevated concentrations of PM10 were shown to be temporal (hourly) evolutions of temperature inversions, stable atmospheric stability and in some cases, wind speed. Concerning the weather prediction during particulate matter related air pollution episodes, the use of the studied models were found to overpredict pollutant dispersion, leading to underprediction of pollutant concentration levels.

Work Stress in the Nursing Profession : An Evaluation of Organizational Causal Attribution

The goal of this study was to examine the role of organizational causal attribution in understanding the relation of work stressors (work-role overload, excessive role responsibility, and unpleasant physical environment) and personal resources (social support and cognitive coping) to such organizational-attitudinal outcomes as work engagement, turnover intention, and organizational identification. In some analyses, cognitive coping was also treated as an organizational outcome. Causal attribution was conceptualized in terms of four dimensions: internality-externality, attributing the cause of one’s successes and failures to oneself, as opposed to external factors, stability (thinking that the cause of one’s successes and failures is stable over time), globality (perceiving the cause to be operative on many areas of one’s life), and controllability (believing that one can control the causes of one’s successes and failures). Several hypotheses were derived from Karasek’s (1989) Job Demands–Control (JD-C) model and from the Job Demands–Resources (JD-R) model (Demerouti, Bakker, Nachreiner & Schaufeli, 2001). Based on the JD-C model, a number of moderation effects were predicted, stating that the strength of the association of work stressors with the outcome variables (e.g. turnover intentions) varies as a function of the causal attribution; for example, unpleasant work environment is more strongly associated with turnover intention among those with an external locus of causality than among those with an internal locuse of causality. From the JD-R model, a number of hypotheses on the mediation model were derived. They were based on two processes posited by the model: an energy-draining process in which work stressors along with a mediating effect of causal attribution for failures deplete the nurses’ energy, leading to turnover intention, and a motivational process in which personal resources along with a mediating effect of causal attribution for successes foster the nurses’ engagement in their work, leading to higher organizational identification and to decreased intention to leave the nursing job. For instance, it was expected that the relationship between work stressors and turnover intention could be explained (mediated) by a tendency to attribute one’s work failures to stable causes. The data were collected from among Finnish hospital nurses using e-questionnaires. Overall 934 nurses responded the questionnaires. Work stressors and personal resources were measured by five scales derived from the Occupational Stress Inventory-Revised (Osipow, 1998). Causal attribution was measured using the Occupational Attributional Style Questionnaire (Furnham, 2004). Work engagement was assessed through the Utrecht Work Engagement Scale (Schaufeli & al., 2002), turnover intention by the Van Veldhoven & Meijman (1994) scale, and organizational identification by the Mael & Ashforth (1992) measure. The results provided support for the function of causal attribution in the overall work stress process. Findings related to the moderation model can be divided into three main findings. First, external locus of causality along with job level moderated the relationship between work overload and cognitive coping. Hence, this interaction was evidenced only among nurses in non-supervisory positions. Second, external locus of causality and job level together moderated the relationship between physical environment and turnover intention. An opposite pattern of interaction was found for this interaction: among nurses, externality exacerbated the effect of perceived unpleasantness of the physical environment on turnover intention, whereas among supervisors internality produced the same effect. Third, job level also disclosed a moderation effect for controllability attribution over the relationship between physical environment and cognitive coping. Findings related to the mediation model for the energetic process indicated that the partial model in which work stressors have also a direct effect on turnover intention fitted the data better. In the mediation model for the motivational process, an intermediate mediation effect in which the effects of personal resources on turnover intention went through two mediators (e.g., causal dimensions and organizational identification) fitted the data better. All dimensions of causal attribution appeared to follow a somewhat unique pattern of mediation effect not only for energetic but also for motivational processes. Overall findings on mediation models partly supported the two simultaneous underlying processes proposed by the JD-R model. While in the energetic process the dimension of externality mediated the relationship between stressors and turnover partially, all the dimensions of causal attribution appeared to entail significant mediator effects in the motivational process. The general findings supported the moderation effect and the mediation effect of causal attribution in the work stress process. The study contributes to several research traditions, including the interaction approach, the JD-C, and the JD-R models. However, many potential functions of organizational causal attribution are yet to be evaluated by relevant academic and organizational research. Keywords: organizational causal attribution, optimistic / pessimistic attributional style, work stressors, organisational stress process, stressors in nursing profession, hospital nursing, JD-R model, personal resources, turnover intention, work engagement, organizational identification.