Wealth shocks, credit-supply shocks, and asset allocation:evidence from household and firm portfolios

We use a unique dataset with bank clients’ security holdings for all German banks to examine how macroeconomic shocks affect asset allocation preferences of households and non-financial firms. Our analysis focuses on two alternative mechanisms which can influence portfolio choice: wealth shocks, which are represented by the sovereign debt crisis in the Eurozone, and credit-supply shocks which arise from reductions in borrowing abilities during bank distress. We document het- erogeneous responses to these two types of shocks. While households with large holdings of secu- rities from stressed Eurozone countries (Greece, Ireland, Italy, Portugal, and Spain) decrease the degree of concentration in their security portfolio as a result of the Eurozone crisis, non-financial firms with similar levels of holdings from stressed Eurozone countries do not. Credit-supply shocks at the bank level (caused by bank distress) result in lower concentration, for both households and non-financial corporations. We also show that only shocks to corporate credit bear ramifications on bank clients’ portfolio concentration, while shocks in retail credit are inconsequential. Our results are robust to falsification tests, propensity score matching techniques, and instrumental variables estimation.

Pitit se rìches malere [Children are the wealth of the poor]: The Influence of Gender and Power on Choice and Uptake of Long Acting Contraceptives

Background: Haiti has the highest maternal mortality rate in the Latin American and Caribbean region. Despite the fact that Haiti has received twice as much family planning assistance as any other country in the western hemisphere, the unmet need for contraception remains particularly high. Our hypothesis is that unsuccessful efforts of family planning programs may be related to a misconstrued understanding of the complex role of gender in relationships and community in Haiti. This manuscript is one of four parts of a study that intends to examine some of these issues with a particular focus on the influence of uptake and adherence to long acting contraceptive (LAC) methods.

Methods: We conducted a three-month community-based qualitative assessment through 20 in-depth interviews in Fondwa, Haiti. Participants were divided into 4 groups of five: female users, female non-users, men and key community stakeholders.

Results: Based on the qualitative interviews, we found that main barriers included lack of access to family planning education and services and concerns regarding side effects and health risks, especially related to menstrual disruption and fears of infertility. Women have a constant pressure to remain fertile and bear children, due not only to social but also economic needs. As relationships are conceived as means for economic provision, the likelihood of uptake of irreversible methods (vasectomy and tubal ligation) was restricted by loss of fertility. Consequently, the discourse of family planning, though self-recognized in their favor, assumes women can afford not to bear children. This assumption should be questioned given the complexities of the other social determinants at play, all which affect the reproductive decisions made by Haitians.

Conclusions: Overall, our study indicated awareness surrounding contraception in the Haitian Fondwa community. Combining the substantial impact of birth spacing with the elevated yet unmet need for contraceptives in the area, it is necessary to address the intricacies of gender issues in order to implement successful programing. In Haiti not being able to bear a child poses a threat to economic and social survival, possibly explaining a dimension of the low uptake of LACs in the region, even when made available. For this reason, we believe IUDs (Intrauterine Devices) provide a suitable alternative, allowing the couple to comprehend all of the factors involved in decision making, thus decreasing the imbalances of power and knowledge prior to considering an irreversible alternative.

Competition for Cooperation: variability, benefits and heritability of relational wealth in hunter-gatherers

Many defining human characteristics including theory of mind, culture and language relate to our sociality, and facilitate the formation and maintenance of cooperative relationships. Therefore, deciphering the context in which our sociality evolved is invaluable in understanding what makes us unique as a species. Much work has emphasised group-level competition, such as warfare, in moulding human cooperation and sociality. However, competition and cooperation also occur within groups; and inter-individual differences in sociality have reported fitness implications in numerous non-human taxa. Here we investigate whether differential access to cooperation (relational wealth) is likely to lead to variation in fitness at the individual level among BaYaka hunter-gatherers. Using economic gift games we find that relational wealth: a) displays individual-level variation; b) provides advantages in buffering food risk, and is positively associated with body mass index (BMI) and female fertility; c) is partially heritable. These results highlight that individual-level processes may have been fundamental in the extension of human cooperation beyond small units of related individuals, and in shaping our sociality. Additionally, the findings offer insight in to trends related to human sociality found from research in other fields such as psychology and epidemiology.

Effect of Wealth on Health Care Seeking Behavior And Out of Pocket Health Expenditure in Malawi

Thesis (Master's)--University of Washington, 2016-06

On the new Kenyan sovereign wealth fund

Sovereign wealth funds (SWFs) have been established in several countries to manage the revenues arising from exhaustible natural resources. SWFs allow consumption to be spread between generations, and between periods of high and low natural resource prices. In this paper the arguments for and against establishing an SWF in Kenya are considered. A first section considers the argument that Kenya is too poor to allocate oil revenues to such a fund. A second section discusses the principles underlying such a fund. A final section concludes by considering the steps that are being taken to establish a Kenyan SWF.

Housing wealth, financial wealth, and consumption: new evidence for Italy and the UK

This paper aims to investigate the long-run impact of housing and financial wealth on consumption in Italy and the UK using two different estimation methods. The novelty of the paper is to consider the recent financial crisis when studying wealth effects. The dynamics of wealth effects is also evaluated by a rolling regression analysis. The results show that: i) housing wealth plays no role in Italy, whereas it is significant in the UK; ii) in both countries, the financial wealth exerts a positive and significant impact on aggregate consumption; iii) by and large, the housing wealth effect assumes relatively increasing importance over time in the UK, while for Italy this is true for the financial wealth effect

Succession in the Family Business: Need to Transfer the ‘Socio-Emotional Wealth’ (SEW)

Rather often we have to confront with the pessimistic views on the future of the family business. Contrary to these prognosis, the FB is not only present but also improving its position in the global economy and playing a key role in the European economy too. They represent 60 % of employment and more than 60 million jobs in the private sector. Among many internal challenges of FB in the five years’ time, the importance of the ‘company succession’ is increasing together with the renewing technology and ‘attracting the right sills/ talents’ (Global Family Survey, 2015). This article is focusing on the transfer of socio-economic wealth (SEW) as a key intangible asset within the intergenerational changes in the FB. The paper outlines the various concepts (narrow vs. broad) of the SEW and special attention is paid to the risk prone [taken] and risk adverse entrepreneurial attitudes. In this relation, the authors made distinction between the ‘opportunity’ and ‘necessity entrepreneurs’. Using empirical experiences based on multi-site company case studies in the three INSIST project countries, the various sub-sections are focusing on the transfer of the following key components of the SEW to the next generation: trust-based social-system, generic human values (i.e. openness, mutual respect, correctness, reliability, responsibility etc.) and ‘practice based – embedded collective knowledge’. Key lesson of this analysis is the following: transferring physical assets in the succession process seems to us less important than the transfer of the intangible one embedded in the company’s culture community. Further systematic national and international investigations – combining quantitative and qualitative research tools – are necessary to acquire more accurate picture on the impacts of transferring both intangible and tangible assets in the succession process in the FB.

Young people's well-being and the economic crisis: How does parental unemployment and family wealth affect the downturn experience?

Background: Portugal is among the European countriesmost severely hit by the economic recession and the fifth with the highest unemployment rate. Given that adolescents' development is highly influenced by their living contexts, monitoring the repercussions of the economic recession is essential for the evaluation and improvement of their current and future public health. Objective: To investigate youth perceived repercussions of the economic recession, its association with life satisfaction, as well as to assess differences across parental employment status and family perceived wealth. Methods: Data were drawn from the Portuguese 2014 Health Behaviour in School-aged children survey, aWHO collaborative cross-national study, with a nationally representative sample of 2748 students (Mage = 14.7 years ± 1.2; 48% boys). Descriptive statistics and linear regression models were performed. Results: Levels of life satisfaction are lower when young people perceive that the economic recession generated negative lifestyle changes. Having unemployed parents was found to be significantly associated with perceiving such repercussions and family wealth to decrease the perception of repercussions of the recession. Conclusions: Findings enhance our understanding of how Portuguese youth are being affected by the socioeconomic conditions surrounding them. Such information contributes to improve future research and also allow some considerations about the policies aimed at protecting young people'swellbeing during a period of high unemployment and socioeconomic downturn.

The wealth effects of commercial bank securities issuances announcement

Banks are often excluded in corporate finance research mainly because of the regulatory concerns. Compares to non-bank firms, banks are heavily regulated due to its special economic role of money and the uncertainty. Heavy regulation on banks could reduce the information asymmetry between the managers and investor by limiting the behaviour of banks at the time of the Seasoned Equity Offering (SEO), and by increasing the incentive for banks to avoid excessive risk-taking. Therefore, the market may be less likely to assume that bank issued securities signal information that the bank is overvalued compared to their non-bank counterparts. The objective of this thesis is therefore to examine commercial banks issued securities announcement effect. Three interrelated research questions are addressed in this thesis: 1) What is the difference in convertible bond announcement effect between banks and non-banks firm? 2) What is the difference in SEO announcement effect between banks and non-banks? 3) How do the stringency levels of bank regulation impact on the announcement effects of bank issued SEO? By using the U.S. convertible bond and SEO data from 1982 to 2012, I find that the bank issued a convertible bond and SEO announcement experience higher cumulative abnormal return than non-bank. This is consistent with the view that bank regulation reveals positive information about banks. Since banks are heavily regulated, the market is less likely to assume that the issuance of the convertible bond and SEO by banks signals information that is overvalued. These results are robust after controlling for a number of firm-, issue-, and market-specific characteristics. These results are robust by considering the different categories of non-bank industries by undertaking tests in relation to the differences in the CARS upon convertible bond/ SEO across industries, as well as the unbalanced sample between banks and non-banks by using the matched sample analysis. However, the relation between the stringency level of bank regulation and bank issued securities announcement effect may be nonlinear. As hypothesised, I find that bank regulation has an inverted U-shaped relation with the announcement effect of bank SEO by using the SEO data across 21 countries from 2001 to 2012. Under a less bank regulation environment, the market reacts more positively to the bank SEO announcement for an increase in the level of bank regulation. However, the bank SEO announcement effects become more negative if the bank regulation becomes too stringent. This inverted U-shaped relationship is robust after I use the exogenous cross-country, cross-year variation in the timing of the Basel II adoption as the instrument to assess the causal impact of bank regulation on SEO announcement effects. However, the stringency of regulation does not have a significant impact on the announcement effects of involuntary bank equity issuance.