The impact of deregulation and re-regulation on bank efficiency: evidence from Asia

Following the 1997 crisis, banking sector reforms in Asia have been characterised by the emphasis on prudential regulation, associated with increased financial liberalisation. Using a panel data set of commercial banks from eight major Asian economies over the period 2001-2010, this study explores how the coexistence of liberalisation and prudential regulation affects banks’ cost characteristics. Given the presence of heterogeneity of technologies across countries, we use a stochastic frontier approach followed by the estimation of a deterministic meta-frontier to provide ‘true’ estimates of bank cost efficiency measures. Our results show that the liberalization of bank interest rates and the increase in foreign banks' presence have had a positive and significant impact on technological progress and cost efficiency. On the other hand, we find that prudential regulation might adversely affect bank cost performance. When designing an optimal regulatory framework, policy makers should combine policies which aim to foster financial stability without hindering financial intermediation.

Energy efficiency potential in Jamaica: challenges, opportunities and strategies for implementation

Incluye Bibliografía

First Europe-Latin America Dialogue on Promotion of Energy Efficiency

Includes bibliography

Straightforward systematic approach for fuel efficiency and emissions assessment in automotive systems

At this time, each major automotive market bares its own standards and test procedures to regulate the vehicle green house gases emissions and, thus, fuel consumption. Hence, much are the ways to evaluate the overall efficiency of motor vehicles. The majority of such standards rely on dynamometer cycle tests that appraise only the vehicle as a whole, but fail to assess emissions for each component or sub-system. Once the amount of work generated by the power source of an ICE vehicle to overcome the driving resistance forces is proportional to the energy contained in the required amount of fuel, the power path of the vehicle can be straightforwardly modeled as a set of mechanical systems, and each sub-system evaluated for its share on the total fuel consumption and green house gases emission. This procedure enables the estimation of efficiency gains on the system due to improvement of particular elements on the vehicle's driveline. In this work a simple systematic mechanical model of an arbitrary smallsized hatch back was assembled and total required energy calculated for different regulatory cycles. All the modeling details of the energy balance throughout the system are presented. Afterward, each subsystem was investigated for its role on the fuel consumption and the generated emission quantified. Furthermore, the application of the modeling technique for different sets of sub-systems was introduced. Copyright © 2011 SAE International.

An assessment of mechanisms to improve energy efficiency in the transport sector in Grenada, Saint Lucia and Saint Vincent and the Grenadines

Like many other Caribbean countries, Grenada, Saint Lucia and Saint Vincent and the Grenadines are almost entirely dependent on imported petroleum as their primary source of energy. In this regard, many countries in the subregion have taken a strategic approach to long-term planning in the energy sector towards creating higher levels of efficiency on both the demand and supply sides as well as promoting diversification in the energy mix. Within this context, this study was conducted to present mechanisms to improve energy efficiency (EE) in the transport sector in Grenada, Saint Lucia and Saint Vincent and the Grenadines. For each country, the report presents a brief description of current trends in energy consumption generally as well as energy issues in the transport sector and programmes, initiatives and regulatory mechanisms currently in place that are contributing to energy efficiency in the sector.

Propuestas regulatorias para el diseño de un mercado ibérico a plazo eficiente de la energía = Regulatory proposals for the development of an efficient iberian energy forward market

El mercado ibérico de futuros de energía eléctrica gestionado por OMIP (“Operador do Mercado Ibérico de Energia, Pólo Português”, con sede en Lisboa), también conocido como el mercado ibérico de derivados de energía, comenzó a funcionar el 3 de julio de 2006. Se analiza la eficiencia de este mercado organizado, por lo que se estudia la precisión con la que sus precios de futuros predicen el precio de contado. En dicho mercado coexisten dos modos de negociación: el mercado continuo (modo por defecto) y la contratación mediante subasta. En la negociación en continuo, las órdenes anónimas de compra y de venta interactúan de manera inmediata e individual con órdenes contrarias, dando lugar a operaciones con un número indeterminado de precios para cada contrato. En la negociación a través de subasta, un precio único de equilibrio maximiza el volumen negociado, liquidándose todas las operaciones a ese precio. Adicionalmente, los miembros negociadores de OMIP pueden liquidar operaciones “Over-The-Counter” (OTC) a través de la cámara de compensación de OMIP (OMIClear). Las cinco mayores empresas españolas de distribución de energía eléctrica tenían la obligación de comprar electricidad hasta julio de 2009 en subastas en OMIP, para cubrir parte de sus suministros regulados. De igual manera, el suministrador de último recurso portugués mantuvo tal obligación hasta julio de 2010. Los precios de equilibrio de esas subastas no han resultado óptimos a efectos retributivos de tales suministros regulados dado que dichos precios tienden a situarse ligeramente sesgados al alza. La prima de riesgo ex-post, definida como la diferencia entre los precios a plazo y de contado en el periodo de entrega, se emplea para medir su eficiencia de precio. El mercado de contado, gestionado por OMIE (“Operador de Mercado Ibérico de la Energía”, conocido tradicionalmente como “OMEL”), tiene su sede en Madrid. Durante los dos primeros años del mercado de futuros, la prima de riesgo media tiende a resultar positiva, al igual que en otros mercados europeos de energía eléctrica y gas natural. En ese periodo, la prima de riesgo ex-post tiende a ser negativa en los mercados de petróleo y carbón. Los mercados de energía tienden a mostrar niveles limitados de eficiencia de mercado. La eficiencia de precio del mercado de futuros aumenta con el desarrollo de otros mecanismos coexistentes dentro del mercado ibérico de electricidad (conocido como “MIBEL”) –es decir, el mercado dominante OTC, las subastas de centrales virtuales de generación conocidas en España como Emisiones Primarias de Energía, y las subastas para cubrir parte de los suministros de último recurso conocidas en España como subastas CESUR– y con una mayor integración de los mercados regionales europeos de energía eléctrica. Se construye un modelo de regresión para analizar la evolución de los volúmenes negociados en el mercado continuo durante sus cuatro primeros años como una función de doce indicadores potenciales de liquidez. Los únicos indicadores significativos son los volúmenes negociados en las subastas obligatorias gestionadas por OMIP, los volúmenes negociados en el mercado OTC y los volúmenes OTC compensados por OMIClear. El número de creadores de mercado, la incorporación de agentes financieros y compañías de generación pertenecientes a grupos integrados con suministradores de último recurso, y los volúmenes OTC compensados por OMIClear muestran una fuerte correlación con los volúmenes negociados en el mercado continuo. La liquidez de OMIP está aún lejos de los niveles alcanzados por los mercados europeos más maduros (localizados en los países nórdicos (Nasdaq OMX Commodities) y Alemania (EEX)). El operador de mercado y su cámara de compensación podrían desarrollar acciones eficientes de marketing para atraer nuevos agentes activos en el mercado de contado (p.ej. industrias consumidoras intensivas de energía, suministradores, pequeños productores, compañías energéticas internacionales y empresas de energías renovables) y agentes financieros, captar volúmenes del opaco OTC, y mejorar el funcionamiento de los productos existentes aún no líquidos. Resultaría de gran utilidad para tales acciones un diálogo activo con todos los agentes (participantes en el mercado, operador de mercado de contado, y autoridades supervisoras). Durante sus primeros cinco años y medio, el mercado continuo presenta un crecimento de liquidez estable. Se mide el desempeño de sus funciones de cobertura mediante la ratio de posición neta obtenida al dividir la posición abierta final de un contrato de derivados mensual entre su volumen acumulado en la cámara de compensación. Los futuros carga base muestran la ratio más baja debido a su buena liquidez. Los futuros carga punta muestran una mayor ratio al producirse su menor liquidez a través de contadas subastas fijadas por regulación portuguesa. Las permutas carga base liquidadas en la cámara de compensación ubicada en Madrid –MEFF Power, activa desde el 21 de marzo de 2011– muestran inicialmente valores altos debido a bajos volúmenes registrados, dado que esta cámara se emplea principalmente para vencimientos pequeños (diario y semanal). Dicha ratio puede ser una poderosa herramienta de supervisión para los reguladores energéticos cuando accedan a todas las transacciones de derivados en virtud del Reglamento Europeo sobre Integridad y Transparencia de los Mercados de Energía (“REMIT”), en vigor desde el 28 de diciembre de 2011. La prima de riesgo ex-post tiende a ser positiva en todos los mecanismos (futuros en OMIP, mercado OTC y subastas CESUR) y disminuye debido a la curvas de aprendizaje y al efecto, desde el año 2011, del precio fijo para la retribución de la generación con carbón autóctono. Se realiza una comparativa con los costes a plazo de generación con gas natural (diferencial “clean spark spread”) obtenido como la diferencia entre el precio del futuro eléctrico y el coste a plazo de generación con ciclo combinado internalizando los costes de emisión de CO2. Los futuros eléctricos tienen una elevada correlación con los precios de gas europeos. Los diferenciales de contratos con vencimiento inmediato tienden a ser positivos. Los mayores diferenciales se dan para los contratos mensuales, seguidos de los trimestrales y anuales. Los generadores eléctricos con gas pueden maximizar beneficios con contratos de menor vencimiento. Los informes de monitorización por el operador de mercado que proporcionan transparencia post-operacional, el acceso a datos OTC por el regulador energético, y la valoración del riesgo regulatorio pueden contribuir a ganancias de eficiencia. Estas recomendaciones son también válidas para un potencial mercado ibérico de futuros de gas, una vez que el hub ibérico de gas –actualmente en fase de diseño, con reuniones mensuales de los agentes desde enero de 2013 en el grupo de trabajo liderado por el regulador energético español– esté operativo. El hub ibérico de gas proporcionará transparencia al atraer más agentes y mejorar la competencia, incrementando su eficiencia, dado que en el mercado OTC actual no se revela precio alguno de gas. ABSTRACT The Iberian Power Futures Market, managed by OMIP (“Operador do Mercado Ibérico de Energia, Pólo Português”, located in Lisbon), also known as the Iberian Energy Derivatives Market, started operations on 3 July 2006. The market efficiency, regarding how well the future price predicts the spot price, is analysed for this energy derivatives exchange. There are two trading modes coexisting within OMIP: the continuous market (default mode) and the call auction. In the continuous trading, anonymous buy and sell orders interact immediately and individually with opposite side orders, generating trades with an undetermined number of prices for each contract. In the call auction trading, a single price auction maximizes the traded volume, being all trades settled at the same price (equilibrium price). Additionally, OMIP trading members may settle Over-the-Counter (OTC) trades through OMIP clearing house (OMIClear). The five largest Spanish distribution companies have been obliged to purchase in auctions managed by OMIP until July 2009, in order to partly cover their portfolios of end users’ regulated supplies. Likewise, the Portuguese last resort supplier kept that obligation until July 2010. The auction equilibrium prices are not optimal for remuneration purposes of regulated supplies as such prices seem to be slightly upward biased. The ex-post forward risk premium, defined as the difference between the forward and spot prices in the delivery period, is used to measure its price efficiency. The spot market, managed by OMIE (Market Operator of the Iberian Energy Market, Spanish Pool, known traditionally as “OMEL”), is located in Madrid. During the first two years of the futures market, the average forward risk premium tends to be positive, as it occurs with other European power and natural gas markets. In that period, the ex-post forward risk premium tends to be negative in oil and coal markets. Energy markets tend to show limited levels of market efficiency. The price efficiency of the Iberian Power Futures Market improves with the market development of all the coexistent forward contracting mechanisms within the Iberian Electricity Market (known as “MIBEL”) – namely, the dominant OTC market, the Virtual Power Plant Auctions known in Spain as Energy Primary Emissions, and the auctions catering for part of the last resort supplies known in Spain as CESUR auctions – and with further integration of European Regional Electricity Markets. A regression model tracking the evolution of the traded volumes in the continuous market during its first four years is built as a function of twelve potential liquidity drivers. The only significant drivers are the traded volumes in OMIP compulsory auctions, the traded volumes in the OTC market, and the OTC cleared volumes by OMIClear. The amount of market makers, the enrolment of financial members and generation companies belonging to the integrated group of last resort suppliers, and the OTC cleared volume by OMIClear show strong correlation with the traded volumes in the continuous market. OMIP liquidity is still far from the levels reached by the most mature European markets (located in the Nordic countries (Nasdaq OMX Commodities) and Germany (EEX)). The market operator and its clearing house could develop efficient marketing actions to attract new entrants active in the spot market (e.g. energy intensive industries, suppliers, small producers, international energy companies and renewable generation companies) and financial agents as well as volumes from the opaque OTC market, and to improve the performance of existing illiquid products. An active dialogue with all the stakeholders (market participants, spot market operator, and supervisory authorities) will help to implement such actions. During its firs five and a half years, the continuous market shows steady liquidity growth. The hedging performance is measured through a net position ratio obtained from the final open interest of a month derivatives contract divided by its accumulated cleared volume. The base load futures in the Iberian energy derivatives exchange show the lowest ratios due to good liquidity. The peak futures show bigger ratios as their reduced liquidity is produced by auctions fixed by Portuguese regulation. The base load swaps settled in the clearing house located in Spain – MEFF Power, operating since 21 March 2011, with a new denomination (BME Clearing) since 9 September 2013 – show initially large values due to low registered volumes, as this clearing house is mainly used for short maturity (daily and weekly swaps). The net position ratio can be a powerful oversight tool for energy regulators when accessing to all the derivatives transactions as envisaged by European regulation on Energy Market Integrity and Transparency (“REMIT”), in force since 28 December 2011. The ex-post forward risk premium tends to be positive in all existing mechanisms (OMIP futures, OTC market and CESUR auctions) and diminishes due to the learning curve and the effect – since year 2011 – of the fixed price retributing the indigenous coal fired generation. Comparison with the forward generation costs from natural gas (“clean spark spread”) – obtained as the difference between the power futures price and the forward generation cost with a gas fired combined cycle plant taking into account the CO2 emission rates – is also performed. The power futures are strongly correlated with European gas prices. The clean spark spreads built with prompt contracts tend to be positive. The biggest clean spark spreads are for the month contract, followed by the quarter contract and then by the year contract. Therefore, gas fired generation companies can maximize profits trading with contracts of shorter maturity. Market monitoring reports by the market operator providing post-trade transparency, OTC data access by the energy regulator, and assessment of the regulatory risk can contribute to efficiency gains. The same recommendations are also valid for a potential Iberian gas futures market, once an Iberian gas hub – currently in a design phase, with monthly meetings amongst the stakeholders in a Working Group led by the Spanish energy regulatory authority since January 2013 – is operating. The Iberian gas hub would bring transparency attracting more shippers and improving competition and thus its efficiency, as no gas price is currently disclosed in the existing OTC market.

Heterogeneous nuclear ribonucleoprotein A1 binds to the transcription-regulatory region of mouse hepatitis virus RNA

A cellular protein, previously described as p35/38, binds to the complementary (−)-strand of the leader RNA and intergenic (IG) sequence of mouse hepatitis virus (MHV) RNA. The extent of the binding of this protein to IG sites correlates with the efficiency of the subgenomic mRNA transcription from that IG site, suggesting that it is a requisite transcription factor. We have purified this protein and determined by partial peptide sequencing that it is heterogeneous nuclear ribonucleoprotein (hnRNP) A1, an abundant, primarily nuclear protein. hnRNP A1 shuttles between the nucleus and cytoplasm and plays a role in the regulation of alternative RNA splicing. The MHV(−)-strand leader and IG sequences conform to the consensus binding motifs of hnRNP A1. Recombinant hnRNP A1 bound to these two RNA regions in vitro in a sequence-specific manner. During MHV infection, hnRNP A1 relocalizes from the nucleus to the cytoplasm, where viral replication occurs. These data suggest that hnRNP A1 is a cellular factor that regulates the RNA-dependent RNA transcription of the virus.

Restriction-modification gene complexes as selfish gene entities: Roles of a regulatory system in their establishment, maintenance, and apoptotic mutual exclusion

We have reported some type II restriction-modification (RM) gene complexes on plasmids resist displacement by an incompatible plasmid through postsegregational host killing. Such selfish behavior may have contributed to the spread and maintenance of RM systems. Here we analyze the role of regulatory genes (C), often found linked to RM gene complexes, in their interaction with the host and the other RM gene complexes. We identified the C gene of EcoRV as a positive regulator of restriction. A C mutation eliminated postsegregational killing by EcoRV. The C system has been proposed to allow establishment of RM systems in new hosts by delaying the appearance of restriction activity. Consistent with this proposal, bacteria preexpressing ecoRVC were transformed at a reduced efficiency by plasmids carrying the EcoRV RM gene complex. Cells carrying the BamHI RM gene complex were transformed at a reduced efficiency by a plasmid carrying a PvuII RM gene complex, which shares the same C specificity. The reduction most likely was caused by chromosome cleavage at unmodified PvuII sites by prematurely expressed PvuII restriction enzyme. Therefore, association of the C genes of the same specificity with RM gene complexes of different sequence specificities can confer on a resident RM gene complex the capacity to abort establishment of a second, incoming RM gene complex. This phenomenon, termed “apoptotic mutual exclusion,” is reminiscent of suicidal defense against virus infection programmed by other selfish elements. pvuIIC and bamHIC genes define one incompatibility group of exclusion whereas ecoRVC gene defines another.

Polymorphism in the 3′-untranslated region of TNFα mRNA impairs binding of the post-transcriptional regulatory protein HuR to TNFα mRNA

Tumor necrosis factor α (TNFα) acts as a beneficial mediator in the process of host defence. In recent years major interest has focused on the AU-rich elements (AREs) present in the 3′-untranslated region (3′-UTR) of TNFα mRNA as this region plays a pivotal role in post-transcriptional control of TNFα production. Certain stimuli, such as lipopolysaccharides, a component of the Gram-negative bacterial cell wall, have the ability to relinquish the translational suppression of TNFα mRNA imposed by these AREs in macrophages, thereby enabling the efficient production of the TNFα. In this study we show that the polymorphism (GAU trinucleotide insertional mutation) present in the regulatory 3′-UTR of TNFα mRNA of NZW mice results in the hindered binding of RNA-binding proteins, thereby leading to a significantly reduced production of TNFα protein. We also show that the binding of macrophage proteins to the main ARE is also decreased by another trinucleotide (CAU) insertion in the TNFα 3′-UTR. One of the proteins affected by the GAU trinucleotide insertional mutation was identified as HuR, a nucleo-cytoplasmic shuttling protein previously shown to play a prominent role in the stability and translatability of mRNA containing AREs. Since binding of this protein most likely modulates the stability, translational efficiency and transport of TNFα mRNA, these results suggest that mutations in the ARE of TNFα mRNA decrease the production of TNFα protein in macrophages by hindering the binding of HuR to the ARE.

Peroxynitrite disables the tyrosine phosphorylation regulatory mechanism: Lymphocyte-specific tyrosine kinase fails to phosphorylate nitrated cdc2(6-20)NH2 peptide.

To determine if nitration of tyrosine residues by peroxynitrite (PN), which can be generated endogenously, can disrupt the phosphorylation of tyrosine residues in proteins involved in cell signaling networks, we studied the effect of PN-promoted nitration of tyrosine residues in a pentadecameric peptide, cdc2(6-20)NH2, on the ability of the peptide to be phosphorylated. cdc2(6-20)NH2 corresponds to the tyrosine phosphorylation site of p34cdc2 kinase, which is phosphorylated by lck kinase (lymphocyte-specific tyrosine kinase, p56lck). PN nitrates both Tyr-15 and Tyr-19 of the peptide in phosphate buffer (pH 7.5) at 37 degrees C. Nitration of Tyr-15. which is the phosphorylated amino acid residue, inhibits completely the phosphorylation of the peptide. The nitration reaction is enhanced by either Fe(III)EDTA or Cu(II)-Zn(II)-superoxide dismutase (Cu,Zn-SOD). The kinetic data are consistent with the view that reactions of Fe(111)EDTA or Cu,Zn-SOD with the cis form of PN yield complexes in which PN decomposes more slowly to form N02+, the nitrating agent. Thus, the nitration efficiency of PN is enhanced. These results are discussed from the point of view that PN-promoted nitration will result in permanent impairment of cyclic cascades that control signal transduction processes and regulate cell cycles.

Should energy efficiency be traded off for other product attributes? : an analysis of air-conditioner regulation in Japan

This paper examines the functioning of energy efficiency standards and labeling policies for air conditioners in Japan. The results of our empirical analysis suggest that consumers respond more to label information, which benchmarks the energy efficiency performance of each product to a pre-specified target, than to direct performance measures. This finding provides justification for the setting, and regular updating, of target standards as well as their use in calculating relative performance measures. We also find, through graphical analysis, that air conditioner manufacturers face a tradeoff between energy efficiency and product compactness when they develop their products. This tradeoff, combined with the semi-regular upward revision of minimum energy efficiency standards, has led to the growth in indoor unit size of air conditioners in recent years. In the face of this phenomenon, regulatory rules were revised so that manufacturers could adhere to less stringent standards if the indoor unit size of their product remains below a certain size. Our demand estimates provide no evidence that larger indoor unit size causes disutility to consumers. It is therefore possible that the regulatory change was not warranted from a consumer welfare point of view.

S. 219--Regulatory Transition Act of 1995 : hearing before the Committee on Governmental Affairs, United States Senate, One Hundred Fourth Congress, first session, on S. 219 ... February 22, 1995.

"To ensure economy and efficiency of federal government opertions by establishing a moratorium on regulatory rulemaking actions, and for other purposes"

Determining the contribution of technical change, efficiency change and scale change to productivity growth in the privatized English and Welsh water and sewerage industry:1985-2000

The water and sewerage industry of England and Wales was privatized in 1989 and subjected to a new regime of environmental, water quality and RPI+K price cap regulation. This paper estimates a quality-adjusted input distance function, with stochastic frontier techniques in order to estimate productivity growth rates for the period 1985-2000. Productivity is decomposed so as to account for the impact of technical change, efficiency change, and scale change. Compared with earlier studies by Saal and Parker [(2000) Managerial Decision Econ 21(6):253-268, (2001) J Regul Econ 20(1): 61-90], these estimates allow a more careful consideration of how and whether privatization and the new regulatory regime affected productivity growth in the industry. Strikingly, they suggest that while technical change improved after privatization, productivity growth did not improve, and this was attributable to efficiency losses as firms appear to have struggled to keep up with technical advances after privatization. Moreover, the results also suggest that the excessive scale of the WaSCs contributed negatively to productivity growth. © 2007 Springer Science+Business Media, LLC.

Colombian society in the 1990s: Fragmentation, legitimacy, and efficiency

During the nineties, Colombia experienced a two-fold process of restructuring. First, the political system underwent a process of constitutional reform in order to strengthen the state and increase its legitimacy, surpass the exclusionary character of the political regime, and achieve greater equity in the distribution of social resources. Second, the economy made the transition from a Keynesian development strategy to a strategy of “opening” or liberalization and internationalization of the economy, in order to increase the economic efficiency by reducing the “size” of the state and its regulatory role. The purpose of this dissertation is to analyze the interplay and contradictions of economic and political factors in the restructuring of the Colombian politico-economic system. ^ The main finding of this dissertation is that the simultaneous adoption of a neoliberal economic strategy and of the Political Constitution of 1991, have had a contradictory relationship: while the “political opening” has produced favorable conditions for fostering programs of democratization and social integration, the “economic opening” has counteracted that possibility given that it implies a social exclusionary process. This tension has aggravated the problems of political and social integration that have traditionally characterized Colombian society. ^ This crucial tension has also been characteristic of Latin America in the nineties. However, it has been neglected and undertheorized in most of the democratization studies of American comparative politics. Most of them lack consideration of structural aspects. According to those studies, the cause of regime change is determined by the strategic elections of actors. Contrary to these approaches, I develop a structural perspective. I consider that social phenomena are partly determined by structural factors, and scientific research should assign them decisive importance, since a fundamental basis for social action and transformation is to be found in the dynamics of relationships between individuals and structures and the development of contradictions within structures. ^