Interbank liquidity crunch and the firm credit crunch: Evidence from the 2007-2009 crisis

We study the credit supply effects of the unexpected freeze of the Europeaninterbank market, using exhaustive Portuguese loan-level data. We find thatbanks that rely more on interbank borrowing before the crisis decrease theircredit supply more during the crisis. The credit supply reduction is stronger forfirms that are smaller, with weaker banking relationships. Small firms cannotcompensate the credit crunch with other sources of debt. Furthermore, theimpact of illiquidity on the credit crunch is stronger for less solvent banks.Finally, there are no overall positive effects of central bank liquidity, but higherhoarding of liquidity.

Assinatura Digital Foco Smart Card

A assinatura digital é um processo de assinatura electrónica baseado no sistema criptográfico assimétrico composto por um algoritmo ou série de algoritmos, mediante o qual é gerado um par de chaves assimétricas exclusivas e complementares. Tal como a assinatura manuscrita, a assinatura digital não pode ser falsificada, pelo que se adiciona uma função hash ao valor da chave gerada, para garantir a segurança do sistema. A assinatura digital permite, ao mesmo tempo, a identificação positiva do autor de uma mensagem (ou do signatário de um documento) e a verificação da integridade da mesma. Refira-se, porém, que a assinatura digital pode ser anexa a qualquer mensagem, seja esta decifrada ou não, apenas para que o receptor tenha a certeza da identidade do emissor e de que a mensagem chegou intacta ao destino. Baseia-se na criptografia da chave pública, que usa um algoritmo de duas chaves, a privada e a pública, diferentes mas matematicamente associadas: a primeira cria a assinatura digital e decifra os dados; a segunda verifica a assinatura e devolve-a ao formato original. O autor da mensagem mantém secreta a sua chave privada e divulga a chave pública, e vice-versa. A identidade do dono da chave pública é atestada pelo certificado digital emitido por uma entidade certificadora (uma espécie de notário). Independentemente da forma que assume, a assinatura electrónica, e a digital em particular, deve cumprir três funções: a autenticação (tal como acontece com o habitual gatafunho a que chamamos assinatura, apenas o indivíduo deve ser capaz de a reproduzir); não repudiação (quando o indivíduo assina não pode voltar atrás); e integridade (é necessário assegurar que os documentos assinados não são alterados sem o consentimento dos signatários).

Do agglomeration economies reduce the sensitivity of firm location to tax differentials?

Low corporate taxes can help attract new firms. This is the main mechanism underpinning the standard 'race-to-the-bottom'view of tax competition. A recent theoretical literature has qualified this view by formalizing the argument that agglomeration forces can reduce firms' sensitivity to tax differentials across locations. We test this proposition using data on firm startups across Swiss municipalities. We find that, on average, high corporate income taxes do deter new firms, but that this relationship is significantly weaker in the most spatially concentrated sectors. Location choices of firms in sectors with an agglomeration intensity at the twentieth percentile of the sample distribution are estimated to be twice as responsive to a given difference in local corporate tax burdens as firms in sectors with an agglomeration intensity at the eightieth percentile. Hence, our analysis confirms the theoretical prediction: agglomeration economies can neutralize the impact of tax differentials on firms' location choices.

The persistence of abnormal returns at industry and firm levels

The present paper proposes a model for the persistence of abnormal returnsboth at firm and industry levels, when longitudinal data for the profitsof firms classiffied as industries are available. The model produces a two-way variance decomposition of abnormal returns: (a) at firm versus industrylevels, and (b) for permanent versus transitory components. This variancedecomposition supplies information on the relative importance of thefundamental components of abnormal returns that have been discussed in theliterature. The model is applied to a Spanish sample of firms, obtainingresults such as: (a) there are significant and permanent differences betweenprofit rates both at industry and firm levels; (b) variation of abnormal returnsat firm level is greater than at industry level; and (c) firm and industry levelsdo not differ significantly regarding rates of convergence of abnormal returns.

Customer Focus Newsleter, January/February, 2008, Vol. 5, no. 1

A bi-monthly bulletin to keep the department/agency management teams of state government better informed. We hope to consolidate most of the service update messages we send throughout the month and keep you updated about the work of the Customer Councils. If yours is one of the many departments who participated in the second annual DAS customer satisfaction survey recently, we thank you for taking the time to give us this important feedback. We look forward to sharing survey results with you, and pledge to consider responses carefully as we work to determine benchmarks and set future priorities.

Políticas Públicas de Inclusão Digital: O Caso das Praças Digitais Konekta na Cidade da Praia

A inclusão digital que vem sendo praticada no país tem abordado, em sua maioria, a necessidade de fazer com que o cidadão aprenda a usar as tecnologias com o objetivo de inseri-lo no mercado de trabalho. Com isso, apresenta resultados das pesquisas acerca do funcionamento e da eficiência destes programas inclusivos, com o intuito de identificar as mudanças que estão a ter na sociedade. Através dele, deu para conhecer o perfil dos utilizadores, os motores de busca mais acessados as diferentes redes sociais procuradas, os principais locais de acesso, mudança de comportamento com a utilização da internet, etc. Desse estudo também deu para constatar que os modelos atuais de “inclusão digital” refletem, na verdade, um distanciamento entre a maioria da população mundial que, por sua vez, colabora para o crescimento da chamada massa de analfabetos digitais. Nesse aspeto essas políticas públicas reforçam a dependência econômica e principalmente cultural atrelando o acesso a uma mudança de atitude social. Não basta criar mecanismos acreditando que a necessidade é puramente técnica operacional. A inclusão deve passar obrigatoriamente pelo acesso ao conhecimento antes do acesso as tecnologias, permitindo uma escolha mais livre e consciente da sua utilização. O que se defende neste trabalho é uma mudança na maneira de “ver” a tecnologia como uma política pública, não apenas como um instrumento solucionador imediato de problemas, mas um conjunto de ações integradas e abrangentes que através de uma apropriação crítica provoque mudanças comportamentais perante a própria tecnologia.

Globalization and the provision of incentives inside the firm: The effect of foreign competition

This paper studies the effect of changes in foreign competition on the structureof compensation and incentives of U.S. executives. We measure foreign competitionas import penetration and use tariffs and exchange rates as instrumental variables toestimate its causal effect on pay. We find that higher foreign competition leads tomore incentive provision in a variety of ways. First, it increases the sensitivity of payto performance. Second, it increases whithin-firm pay differentials between executivelevels, with CEOs typically experiencing the largest wage increases, partly becausethey receive the steepest incentive contracts. Finally, higher foreign competition is alsoassociated with a higher demand for talent. These results indicate that increased foreigncompetition can explain some of the recent trends in compensation structures.

Customer Focus Newsletter, March/April, 2008, Vol. 5, no. 2

A bi-monthly bulletin to keep the department/agency management teams of state government better informed. We hope to consolidate most of the service update messages we send throughout the month and keep you updated about the work of the Customer Councils. If yours is one of the many departments who participated in the second annual DAS customer satisfaction survey recently, we thank you for taking the time to give us this important feedback. We look forward to sharing survey results with you, and pledge to consider responses carefully as we work to determine benchmarks and set future priorities.

Testing financing constraints on firm investment using variable capital

We consider a dynamic multifactor model of investment with financing imperfections,adjustment costs and fixed and variable capital. We use the model to derive a test offinancing constraints based on a reduced form variable capital equation. Simulation resultsshow that this test correctly identifies financially constrained firms even when the estimationof firms investment opportunities is very noisy. In addition, the test is well specified inthe presence of both concave and convex adjustment costs of fixed capital. We confirmempirically the validity of this test on a sample of small Italian manufacturing companies.

Firm-specific investment, sticky prices and the Taylor principle

According to the Taylor principle a central bank should adjust the nominal interest rate by more than one-for-one in response to changes in current inflation. Most of the existing literature supports the view that by following this simple recommendation a central bank can avoid being a source of unnecessary fluctuations in economic activity. The present paper shows that this conclusion is not robust with respect to the modelling of capital accumulation. We use our insights to discuss the desirability of alternative interest raterules. Our results suggest a reinterpretation of monetary policy under Volcker and Greenspan: The empirically plausible characterization of monetary policy can explain the stabilization of macroeconomic outcomes observed in the early eighties for the US economy. The Taylor principle in itself cannot.

Ex post bargaining, labor coordination and wage formation at the firm level

We lay out a model of wage bargaining with two leading features:bargaining is ex post to relevant investments and there isindividual bargaining in firms without a Union. We compareindividual ex post bargaining to coordinated ex post bargainingand we analyze the effects on wage formation. As opposed to exante bargaining models, the costs of destroying the employmentrelationship play a crucial role in determining wages. Highfiring costs in particular yield a rent for employees. Ourtheory points to a employer size-wage effect that is independentof the production function and market power. We derive a simpleleast squares specification from the theoretical model thatallow us to estimate components of the wage premium fromcoordination. We reject the hypothesis that labor coordinationdoes not alter the extensive form of the bargaining game. Laborcoordination substantially increases bargaining power butdecreases labor's ability to pose costly threats to the firm.

Label-free cytotoxicity screening assay by digital holographic microscopy

Abstract We introduce a label-free technology based on digital holographic microscopy (DHM) with applicability for screening by imaging, and we demonstrate its capability for cytotoxicity assessment using mammalian living cells. For this first high content screening compatible application, we automatized a digital holographic microscope for image acquisition of cells using commercially available 96-well plates. Data generated through both label-free DHM imaging and fluorescence-based methods were in good agreement for cell viability identification and a Z'-factor close to 0.9 was determined, validating the robustness of DHM assay for phenotypic screening. Further, an excellent correlation was obtained between experimental cytotoxicity dose-response curves and known IC values for different toxic compounds. For comparable results, DHM has the major advantages of being label free and close to an order of magnitude faster than automated standard fluorescence microscopy.

Customer Focus Newsletter, July/August, 2008, Vol. 5, no. 4

A bi-monthly bulletin to keep the department/agency management teams of state government better informed. We hope to consolidate most of the service update messages we send throughout the month and keep you updated about the work of the Customer Councils. If yours is one of the many departments who participated in the second annual DAS customer satisfaction survey recently, we thank you for taking the time to give us this important feedback. We look forward to sharing survey results with you, and pledge to consider responses carefully as we work to determine benchmarks and set future priorities.

Customer Focus Newsletter, May/June, 2008, Vol. 5, no. 3

A bi-monthly bulletin to keep the department/agency management teams of state government better informed. We hope to consolidate most of the service update messages we send throughout the month and keep you updated about the work of the Customer Councils. If yours is one of the many departments who participated in the second annual DAS customer satisfaction survey recently, we thank you for taking the time to give us this important feedback. We look forward to sharing survey results with you, and pledge to consider responses carefully as we work to determine benchmarks and set future priorities.