Nach oben pdf The benefits and costs of renminbi internationalization

The benefits and costs of renminbi internationalization

The benefits and costs of renminbi internationalization

Although some countries’ policy making has indicated a reluctance to have their currencies internationalized, there has long been academic discussion of the benefits and costs of being an international currency. Cohen (2012) summarized the benefits and risks of being an international currency. He argued that the benefits may include transaction cost reductions, collection of international seigniorage, macroeconomic flexibility, political leverage, and reputation as a soft national power. The corresponding costs or risks include a tendency toward currency appreciation, external constraints imposed on domestic monetary autonomy, and a greater global policy responsibility. Genberg (2010) pointed out that there are incremental benefits during the internationalization process and that one of the costs is associated with international bond issues, which make domestic interest rates more dependent on external factors. In a more specific context, Papaioannou and Portes (2008) analyzed the costs and benefits of the euro as an international currency. They argued that the introduction of the euro noticeably reduced transaction costs in both financial markets and financial services and promoted global financial integration. They also found no evidence that currency internationalization made it more difficult to enforce monetary policy. Kim and Suh (2011) compared the gains with the losses during internationalization of the Republic of Korea’s won. They argued that one of the main benefits of the won becoming an international currency was to blunt the adverse effects of external financial shocks, which could be very important for a small, open economy. However, there also was a significant transitional risk. An emerging market economy hoping to internationalize its currency must liberalize its capital account, which may increase the country’s vulnerability to external shocks and even cause financial instability.
Mehr anzeigen

30 Mehr lesen

Assessing the costs and benefits of capital-based macroprudential policy

Assessing the costs and benefits of capital-based macroprudential policy

The simulation results from the model suggest that the net benefits (and in particular short- term macro costs) of capital-based measures depend on how banks move to higher capital ratios. Under the assumption that banks react to higher capital requirements by asset-side deleveraging, the net benefits of activating capital-based measures are, at the end of the sample period (2014Q4), estimated to be negative for the majority of European countries. This reflects the fact that the financial cycle was still in a depressed phase in many countries, so that the potential benefits of activating capital-based macroprudential tools would be rather limited. On the other hand, asset-side deleveraging corresponds to a reduction in banks’ loan supply, for which the model in this case suggests a negative GDP response, therefore implying a non-zero gross cost. In contrast, under the assumption that the banking system reacts to higher capital requirements by raising and investing equity capital, the GDP responds positively, so that there is no cost from that perspective. Higher capitalization levels further contribute to increased resilience and a fall in banking crisis probabilities, and consequently the net benefits would be positive in all European countries. A counteracting force arises from somewhat stronger credit and asset price growth, implying a move toward overheating and thus upward pressure on crisis probabilities. This effect, however, is by far outweighed by stronger capitalization and the initially positive short-term GDP response.
Mehr anzeigen

47 Mehr lesen

The costs and benefits of different initial teacher training routes

The costs and benefits of different initial teacher training routes

Figure 5.3 compares the total cost of a trainee with a first-class degree across the different levels of subject priority. As already noted, Teach First is the cheapest for high-priority subjects and School Direct unsalaried is the most expensive. For non-priority subjects, the lack of bursary funding available for the graduate tuition fee routes means that, with the exception of School Direct salaried, the costs of all routes are very similar. School Direct salaried has a negative total cost in this case, as no direct funding is provided by central government. We do not consider this a reliable estimate of the total cost of School Direct salaried for a non-priority subject trainee because the average net school benefit was not calculated at subject level. It is unlikely that schools would use School Direct unsalaried for a subject where no funding is available and, if they did, it seems unlikely the net benefit would be the same as for schools that do receive a grant. For primary schools (see Figure 5.4), there is less variation in the net school benefit per route. Therefore the picture for the total costs of each route is similar to that discussed for central costs in Section 4.1. BEd, HEI-led PGCE, SCITT and School Direct unsalaried routes all have similar total costs per trainee with a first-class degree, whereas School Direct salaried is substantially cheaper. The BEd route is then the most expensive route for training teachers with lower-class degrees, as the costs of this route are not dependent on degree class. The
Mehr anzeigen

85 Mehr lesen

Assessing the costs and benefits of capital-based macroprudential policy

Assessing the costs and benefits of capital-based macroprudential policy

We also analyse how the performance of the models and the estimation of benefits changes if the definition of the dependent variable in the logit model is altered. First, following Bussi` ere and Fratzscher (2006), we use use a multinomial logit model to further address potential crisis/post- crisis bias. Coefficients for the distinction between pre-crisis and tranquil periods are very similar to those in the main specifications (Table 4, column 1; compare with Table 2, column 8), and predicted probabilities from the two models are closely correlated (the correlation is 0.979). Column 2 shows that there are also some significant differences between tranquil and crisis/post-crisis periods, which are, however, omitted in the main specifications. Further, Table 4 shows the results for four alternative definitions of vulnerable states: 5-12, 1-12, and 1-8 quarters preceding the crisis in order to properly take into account potential late signals of the model; and 9-16 quarters, so as to analyse potential early crisis signals. The overall fit (as given by the Pseudo R-squared and the AUROC metrics) of the models with the alternative definitions of a vulnerable state is lower or in the same ballpark as for the main specification in column 8 of Table 2. Coefficients are also similar to the main specification, where the model with a 1-8 quarter prediction horizon stands out to some extent, since GDP growth tends to be more positive in the quarters directly preceding a crisis, while house price growth tends to be less pronounced. Figure 14, Panel B, illustrates that benefit estimates remain relatively stable with a different prediction horizon (5-12 quarters).
Mehr anzeigen

48 Mehr lesen

The economics of enhancing accessibility estimating the benefits and costs of participation

The economics of enhancing accessibility estimating the benefits and costs of participation

disability as ‘arising from the interaction of a person’s functional status with the physical, cultural, and policy environments.’ Many countries now use the ‘Washington Group Short Set’ questions to produce internationally comparable data about disability and its variation within a population. These questions include for example ‘Do you have difficulty seeing, even if wearing glasses?’ and ‘Do you have difficulty walking or climbing steps?’ (Madans, Loeb & Altman, 2011; Washington Group on Disability Statistics, 2009). Frye (2012) states that Census data such as the Washington Group Short Set responses are often too broad to be useful as a driver of policy change, and in any case there is too much lag between data collection and its publication for it to be a political lever. In some countries (including New Zealand), these data about disability are not disaggregated to anything less than national or regional level. Importantly, for this paper, lacking low-level spatial data about people and their diverse abilities means that local authorities who make transport investment decisions have no data at all about differences within their population; they cannot invest in accessibility improvements that would benefit particular groups with any confidence that the investment in that particular location is justified according to relative need.
Mehr anzeigen

24 Mehr lesen

The People's Republic of China's financial markets: Are they deep and liquid enough for renminbi internationalization?

The People's Republic of China's financial markets: Are they deep and liquid enough for renminbi internationalization?

The PRC’s money market is developing fast, undergoing fundamental changes, and has become much more active in recent years. The money market mainly relies on secondary markets like bond repurchases and on an uncollateralized basis like interbank lending because of the lack of primary market tools (Table 2). Unlike bank interest rates, yields in the money market are not regulated but determined by market forces. Currently, central bank bills play the role of treasury bills as the PRC’s treasuries are dominated by medium- and long-term bonds. The peak of central bank bill issuance of CNY996 billion was in March 2007, when the PBC sterilized the record high foreign exchange inflows early that year. Unlike in the US, commercial papers (CP) only play a small role in the PRC’s money market, even after including promissory notes from financial institutions. As an alternative instrument under the dominance of indirect finance from commercial banks, bank acceptance (BA, mostly eligible bills) also plays an important role in the PRC’s money market. The total issuance of BA rose from CNY6 trillion in 2007 to CNY21 trillion in 2013, contributing around 90% of the basic instruments issued that year.
Mehr anzeigen

38 Mehr lesen

Costs and benefits of immigration and multicultural interaction

Costs and benefits of immigration and multicultural interaction

Abstract This paper studies how the existence of a minority culture influences the well-being of the native population and its attitude towards immigrants. In this context, I as- sume that multicultural interaction can be advantageous for immigrants and natives if intercultural obstacles and communication problems are abolished. It is found that certain shares of the immigrant as well as of the native population have incentives to acquire knowledge of the respective other culture since it enables them to interact with each other. I find that immigrants are more likely to acquire knowledge of the domestic culture than vice versa what I attribute to differences in the respective population size, assortative matching behavior and potentially asymmetric learning costs. The model further predicts that natives who have sufficiently low costs of learning the foreign cul- ture are willing to vote for free migration whereas those who have higher learning costs will be in favor of immigration restrictions.
Mehr anzeigen

31 Mehr lesen

Cooperation, discounting, and the effects of delayed costs and benefits

Cooperation, discounting, and the effects of delayed costs and benefits

1 Introduction Many economic decisions involve a time dimension forcing people to make intertemporal trade-offs between costs and benefits that occur at different points in time. Numerous studies, both theoretically and empirically, have investigated these trade-offs in the context of individual decision making in which choices only affect oneself, such as saving, human capital accumulation, dieting, or exercising (see Frederick et al., 2002, for an overview). The timing of when costs and benefits realize, however, is also important in strategic decision situations in which outcomes also depend on the choices of others. Yet, so far only very little is known about how intertemporal trade-offs unfold in such situations, and it is far from obvious whether people discount payoffs similarly across individual and strategic decisions as the latter are much more complex, and, hence, subjects might rely on very different cues or strategies. Furthermore, in strategic contexts other-regarding concerns may affect behavior, too, and these concerns might interact with individuals’ time preferences in non-trivial ways. As such, it is important to study both of these dimensions in conjunction rather than in isolation as most previous literature did. Here, we provide a systematic and comprehensive analysis of how the timing of costs and benefits affects game-play in a strategic decision situation, and highlight the channels through which the factor time affects behavior. Our results reveal that delaying the consequences of actions affects behavior through multiple channels, and that discounting in strategic contexts may exceed the degree of discounting typically observed in individual decision contexts.
Mehr anzeigen

43 Mehr lesen

Costs and benefits of immigration and multicultural interaction

Costs and benefits of immigration and multicultural interaction

With regard to the empirical literature on the attitudes towards immigrants, one finds large support for the suggestion that those who are rather inefficient in learning another culture on average to the strongest degree oppose immigration. More precisely, it is mainly argued that opposition to immigration is higher if the individual is among the old, unedu- cated, nationally immobile, patriotic and does not belong to a cultural minority (Espenshade and Hempstead 1996, O’Rourke and Sinnott 2006, Hainmueller and Hiscox 2007, 2010). All the mentioned groups can certainly be assumed to face higher cultural learning costs. Besides the heterogeneity in cultural learning costs, I pointed at the gain of intercultural exchange which shapes the attitude towards immigration and multiculturalism on a country level. From our results, one can propose that countries which are in favor of a multicultural society (due to gains from intercultural interaction) will also be more open for immigration. As has been mentioned by Fujita and Weber (2004), differences according to the task relevance of multicultural exchange can explain differences between immigration policies of the U.S and Japan.
Mehr anzeigen

30 Mehr lesen

Self-employment and marriage: Costs and benefits

Self-employment and marriage: Costs and benefits

Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes. You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public.

6 Mehr lesen

Costs and Benefits of Political and Physical Collaboration in the European Power Market

Costs and Benefits of Political and Physical Collaboration in the European Power Market

The description of possible futures through the creation of scenarios is a for- malized way to make statements about possible future development paths using knowledge from the present and insights from the past. A fundamental distinction can be made between qualitative and quantitative scenarios. Qualitative scenarios, often also called narratives or storylines, are largely based on verbal descriptions of potential futures [e.g., 5]. Methods for developing such narratives are usually flexible in terms of the parameters they require, allowing to consider a range of different social, economical, technical, and environmental parameters. This way, softer and more diffuse concepts such as political stability, or environmental awareness can be included in the analysis. Computer-based quantitative scenarios, on the other hand, allow for numerical insight into the system under consideration. Alcamo [6] argues that quantitative approaches are more transparent than their qualitative counter- parts because their model assumptions are expressed as mathematical equations. Craig et al. [7] contrast this with the fact that, for energy forecasts, there are nec- essarily implicit assumptions about human behavior, including social, institutional and personal interactions, as well as human innovation.
Mehr anzeigen

43 Mehr lesen

Regional disintegration in the Soviet Union: Economic costs and benefits

Regional disintegration in the Soviet Union: Economic costs and benefits

Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes. You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public.

8 Mehr lesen

Assessing Costs and Benefits of Coastal Structures to Mitigate Erosion

Assessing Costs and Benefits of Coastal Structures to Mitigate Erosion

Coastal zones experience increased rates of erosion, mainly due to fluvial sediment supply reduction, as well as coastal areas degradation and transformation due to anthropogenic actions. Additionally, climate change effects also increase coastal erosion problems (Nicholls, 2002; EEA, 2006; Alves et al., 2009; Robinson, 2017). As a coastal erosion consequence, a growing trend of conflicts between shoreline evolution, land use and erosion mitigation measures is observed (Coelho et al., 2016). Despite coastal erosion impacts being confined to coastal areas, these areas host over 40% of the world population, as well as a wide variety of coastal ecosystems that provide various different services (Martínez et al., 2007; Roebeling et al., 2011). One approach to mitigate erosion problems is coastal protection, involving defence techniques to preserve vulnerable areas, such as population centres, economic activities and natural resources. These strategies to mitigate coastal erosion are mainly reactive and tend to not include local stakeholders in the decision-making process (O’Riordan et al., 2014). Although some erosion impacts can be mitigated through coastal protection works, such measures may represent negative second order impacts for coastal environments and social and economic life (EEA, 2013).
Mehr anzeigen

11 Mehr lesen

Estimating the Costs and Benefits of Local Government Reorganisation: A Case of Korea

Estimating the Costs and Benefits of Local Government Reorganisation: A Case of Korea

The costs of replacing existing road signs will also be included. □ Costs of loss of community identity The costs of the loss of community identity which residents within the area might experience will be examined. For this analysis, choice experiments (CE) will be employed. In a CE, individuals are given a hypothetical setting and asked to make a choice among several alternatives in a choice set, and they are usually asked to perform a sequence of such choices (Alpizar et al., 2001: 84). Hence, CEs can be useful tools for valuing non-market goods in the areas of local government reorganisation (Willis, 2002). Valuation of non-market goods has been neglected in the estimation of the benefits and costs connected with reorganisation. The research project conducted for Jeju Province applied the CE method to assess qualitatively related non-market goods, including satisfaction with area-wide problem solutions, satisfaction with the faster processing of customer services such as licence and planning permission, and loss of local identity and political representation (see Jeju Development Institute, 2004).
Mehr anzeigen

21 Mehr lesen

Costs and Benefits of Overlapping Regional Organizations in Latin America: the Case of the OAS and UNASUR

Costs and Benefits of Overlapping Regional Organizations in Latin America: the Case of the OAS and UNASUR

Instead, the Venezuelan government again invited a UNASUR mission to “accompany” the elections (Misión Electoral de Acompañamiento). But this mission also had a bumpy start as the Maduro government rejected the proposed Brazilian mission leader and Brazil dropped out of the mission as a consequence. Only on November 12, 2015, was an agreement signed between UNASUR and the Venezue- lan National Electoral Council. In the meantime, Luis Almagro, the new secretary- general of the OAS, also officially offered to send an electoral observation mission, an offer that the Electoral Council rejected. In reaction, Almagro wrote an 18-page letter (OAS 2015a) to the Electoral Council on November 10, raising alarms about the fairness of the upcoming vote: “there is reason to believe that the conditions in which the people will vote on December 6 will not enjoy the level of transparency and electoral justice that you, at the National Electoral Council, should guarantee.” The letter (as well as two additional messages before the election) put some pressure on the Venezuelan government and may have reduced the risk of flagrant manipu- lations. In the end, the UNASUR mission of approximately 50 members was also welcomed by the Venezuelan opposition. The elections were transparent, and the opposition won with a clear majority.
Mehr anzeigen

27 Mehr lesen

Renewable energy deployment - do the benefits outweigh the costs?

Renewable energy deployment - do the benefits outweigh the costs?

The extension of the transmission grid is in many cases beneficial to all grid users, namely for electricity suppliers with RE and fossil sources. Therefore it is difficult to identify which costs are related to the extension of renewable generators and how these additional costs should be allocated to the various users in the grid. Therefore the given figures are only partly related to the extension of renewable generators. The first DENA study identified the need for additional grid capacity of 850 km of new lines. The invest- ment needs for the new capacity was estimated to 1.1 billion Euro until 2015 without costs for offshore grid connections. However, until the end of 2011 little more than 210 km have been built. The overall investment is estimated to be around 400 million Euro for the on- shore grid extensions until 2011. Furthermore the first offshore grid connections have been implemented, e.g. Alpha Ventus in the North Sea and Baltic 1 in the Baltic Sea. The con- struction of several offshore grid connections has started in 2011 as for Baltic 2, BorWin 2 or Riffgat. A total of 2 billion Euro is estimated for investments in offshore grid connec- tions until the end of 2011. The annuity of these investments is calculated with an interest rate of 6.5 % and a lifetime of 40 years. The annuity indicates annual costs for grid exten-
Mehr anzeigen

31 Mehr lesen

Eastward enlargement: Benefits and costs of EU entry for the transition countries

Eastward enlargement: Benefits and costs of EU entry for the transition countries

Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes. You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public.

10 Mehr lesen

Costs and Benefits of Kosovo's Future Status

Costs and Benefits of Kosovo's Future Status

ability to use the positive effects of transition, i.e., of privatization and foreign investment inflows, to support the development agenda. Fiscal sustainability, historically Kosovo was the recipient of significant budget and other financial support until the late 1980s. This system was discontinued on the eve of the dissolution of Yugoslavia. After the suspension of Kosovo’s autonomy and the referendum for independence in the late 1980s and early 1990s, Kosovo was increasingly fiscally independent from Serbia. The Serbian government tolerated this independence as it minimized its financial obligations. Given that the fiscal system of Kosovo’s parallel state was not transparent at the time, it is hard to say anything with any kind of certainty about the costs and benefits of this dual system of public governance. Similarly, it is close to impossible to sort out the economic costs and benefits as much of what transpired in trade and investment went on under nonstandard circumstances and was not properly recorded statistically. Clearly, some of the more important resources of Kosovo – in the electricity sector and in extraction – were run by the Serbian state and must have provided it with some fiscal resources, but those would be very difficult to quantify with any precision. But the country, Serbia together with Kosovo, was under a rather severe system of international sanctions for most of the 1990s, and was also supporting several war efforts as well as the repressive regime in Kosovo, so that the economic distortions were so large that not very much can be said on the basis of that experience (Gligorov, 2002).
Mehr anzeigen

42 Mehr lesen

Costs and benefits of political and physical collaboration in the European Power Market

Costs and benefits of political and physical collaboration in the European Power Market

4.4. Electricity prices Electricity prices differ within Europe across narratives. Table 2 presents differ- ences between narratives over time by showing the weighted-average of European electricity prices from 2015 to 2050 for the two power market models EUREGEN and urbs (see Subsection E.6 in Appendix E for the underlying metrics to calculate prices). Observe that prices are slightly higher in EUREGEN than in urbs (6% in 2015, 14 to 21% in 2050). Differences between models can be traced back to model- specific features and the underlying temporal resolution. For example, EUREGEN allows for endogenous decommissioning of capacities, which increases prices in 2020 already. The differences decrease over time (for all three narratives) but remain substantial due to the selection of hours to represent the whole year. On one hand, the hour choice and weighting algorithm of EUREGEN selects 112 representative hours to reflect the extremes of wind, solar, and load in each country of Europe, and weight them to reduce the error to the hourly time series. On the other hand, urbs selects 672 hours heuristically and weights them equally. As a consequence, the representation of hours in EUREGEN leads to higher prices than the specific selection of hours in urbs. Thus, we apply electricity price indices (referring to the respective European average of each model) to compare regional differences of the models across narratives.
Mehr anzeigen

44 Mehr lesen

Costs and benefits of differentiated integration: Lessons from the Schengen and Pruem laboratories

Costs and benefits of differentiated integration: Lessons from the Schengen and Pruem laboratories

As we can derive from this taxonomy, transaction-costs are conceptually inherently dynamic (Dixit 1996, pp. 43-44). The last component of our framework adds to these dynamic aspects and the strategic dimension of club formation. I borrow from insights of the venue-shopping theory as outlined by Baumgartner and Jones (1993) that theorizes similar strategic actions, but rests on basic assumptions which are not sufficiently convincing under the present discussion of differentiated integration. 2 A recent perspective on venue shopping that focuses less on the issues at stake and more systematically on the key actors’ political strategies is helpful to convincingly apply this framework to the challenging issue of differentiated integration as club formation (Pralle 2003). Firstly, Pralle argues that venue shopping (read here instead: sub club formation) can be more experimental and less deliberate or calculated than commonly perceived; secondly, actors choose venues not only to advance substantive policy goals, but also to reinforce organizational identities; and finally, venue choice is shaped by policy learning processes (Pralle 2003, 234). In general, these findings fit very well with the empirical case studies of this article and can be transposed to club theory reasoning. Club formation opens the leverage to forward and decide on policy proposals that have been blocked in the Council before. Tactical reasoning of adversaries' exclusion seems to be purely calculated, whereas the “long term” circumvention strategy is far more experimental and challenged by contingent dynamics. I presume that the strategic goal of the sub club members is to eventually communitarize their club good by having all member states take part in the policy by way of altering the cost-benefit balance. I, however, argue that experimentation and contingency play a major role in the process of defining how this strategic goal can be reached. Furthermore, Pralle's emphasis of policy learning touches my case studies in two ways. First, in several aspects the Pruem initiative was rooted in the Schengen experience and partly driven by the same actors. Hence, it accounts per se for an instance of policy learning. Second, empirical evidence from both cases shows a strong reframing of the initiative as a
Mehr anzeigen

30 Mehr lesen

Show all 10000 documents...