Bank ownership and efficiency in China: what lies ahead in the world’s largest nation?

China is reforming its banking system, partially privatizing and permitting minority foreign ownership of three of the dominant ‘big four’ state-owned banks. This paper seeks to help predict the effects of this change by analysing the efficiency of virtually all Chinese banks in the years 1994–2003. Our findings suggest the big four banks are by far the least efficient and foreign banks the most efficient while minority foreign ownership is associated with significantly improved efficiency. We present corroborating robustness checks and offer several credible mechanisms through which minority foreign owners can increase Chinese bank efficiency. These findings suggest that minority foreign ownership of the big four is likely to significantly improve performance.foreign banks; efficiency; foreign ownership

Does diversification increase or decrease bank risk and performance? Evidence on diversification and the risk-return tradeoff in banking

Conventional wisdom in banking argues that diversification tends to reduce bank risk and improve performance, but the recent financial crisis suggests that aggressive diversification strategies may have resulted in increased risk taking and poor performance. This paper addresses this important question by evaluating the empirical relationship between diversification strategies and the risk-return tradeoff in banking. Our data set covers Russian banks during the 1999-2006 period and finds somewhat mixed results. Specifically, we find that banks’ performance tends to be non-monotonically related to their diversification strategy. The marginal effects of focus indices (inverse measures of diversification) on performance are nonlinearly associated with the level of risk and foreign ownership. A focused strategy is found to be associated with increased profit and decreased risk only up to a certain threshold. Additionally, when foreign ownership is either very high or very low, banks tend to benefit more from being diversified. This analysis provides important strategic and policy implications for bank managers and regulators in Russia as well as in other emerging economies.banks; diversification; focus; Russia; foreign ownership; scope economies

The Application of Critical Power, the Work Capacity above Critical Power (W'), and its Reconstitution: A Narrative Review of Current Evidence and Implications for Cycling Training Prescription

The two-parameter critical power (CP) model is a robust mathematical interpretation of the power–duration relationship, with CP being the rate associated with the maximal aerobic steady state, and W' the fixed amount of tolerable work above CP available without any recovery. The aim of this narrative review is to describe the CP concept and the methodologies used to assess it, and to summarize the research applying it to intermittent cycle training techniques. CP and W' are traditionally assessed using a number of constant work rate cycling tests spread over several days. Alternatively, both the 3-min all-out and ramp all-out protocols provide valid measurements of CP and W' from a single test, thereby enhancing their suitability to athletes and likely reducing errors associated with the assumptions of the CP model. As CP represents the physiological landmark that is the boundary between heavy and severe intensity domains, it presents several advantages over the de facto arbitrarily defined functional threshold power as the basis for cycle training prescription at intensities up to CP. For intensities above CP, precise prescription is not possible based solely on aerobic measures; however, the addition of the W' parameter does facilitate the prescription of individualized training intensities and durations within the severe intensity domain. Modelling of W' reconstitution extends this application, although more research is needed to identify the individual parameters that govern W' reconstitution rates and their kinetic

Maximum relative excitation of a specific vibrational mode via optimum laser pulse duration

For molecules and materials responding to femtosecond-scale optical laser pulses, we predict maximum relative excitation of a Raman-active vibrational mode with period T when the pulse has an FWHM duration of 0.42 T. This result follows from a general analytical model, and is precisely confirmed by detailed density-functional-based dynamical simulations for C60 and a carbon nanotube, which include anharmonicity, nonlinearity, no assumptions about the polarizability tensor, and no averaging over rapid oscillations within the pulse. The mode specificity is, of course, best at low temperature and for pulses that are electronically off-resonance, and the energy deposited in any mode is proportional to the fourth power of the electric field.Comment: 5 pages, 4 figure

Atomic spatial coherence with spontaneous emission in a strong coupling cavity

The role of spontaneous emission in the interaction between a two-level atom and a pumped micro-cavity in the strong coupling regime is discussed in this paper. Especially, using a quantum Monte-Carlo simulation, we investigate atomic spatial coherence. It is found that atomic spontaneous emission destroys the coherence between neighboring lattice sites, while the cavity decay does not. Furthermore, our computation of the spatial coherence function shows that the in-site locality is little affected by the cavity decay, but greatly depends on the cavity pump amplitude.Comment: 4 pages, 5 figures, accepted by PR

Default, mortgage standards and housing liquidity

The effects of households' indebtedness on their house-selling decisions are studied in a dynamic equilibrium model with search in the housing market and defaultable long-term mortgages. In equilibrium, both sellers' asking prices and time-to-sell increase with the relative size of their outstanding mortgages. In turn, the liquidity of the housing market associated with time-to-sell determines the mortgage standards of competitive lenders, measured by the maximum loan-to-value (LTV) ratio offered at origination. Calibrated to the U.S. economy, the model generates, as observed, positive correlations over time between house prices and LTV's at origination and across sellers among asking prices, time-to-sell, and LTV's outstanding

Impact of Measurement System Characteristics on Advanced Sounder Information Content

Advanced satellite sensors are tasked with improving global observations of the Earth's atmosphere, clouds, and surface to enable enhancements in weather prediction, climate monitoring capability, and environmental change detection. Achieving such an improvement in geophysical information inferred from these observations requires optimal usage of data from current systems as well as instrument system enhancements for future sensors. This presentation addresses results of tradeoff studies evaluating the impact of spectral resolution, spectral coverage, instrument noise, and a priori knowledge on remote sensing system information content, with a specific emphasis on thermodynamic state and trace species information obtainable from advanced atmospheric sounders. Particular attention will be devoted toward information achievable from the Atmospheric InfraRed Sounder (AIRS) on the NASA EOS Aqua satellite in orbit since 2002, the Infrared Atmospheric Sounding Interferometer (IASI) aboard MetOp-A since 2006, and the Cross-track Infrared Sounder (CrIS) instrument to fly aboard the NPP and JPSS series of satellites expected to begin in late 2011. While all of these systems cover nearly the same infrared spectral extent, they have very different number of channels, instrument line shapes, coverage continuity, and instrument noise. AIRS is a grating spectrometer having 2378 discrete spectral channels ranging from about 0.4 to 2.2/cm resolution; IASI is a Michelson interferometer with 8461 uniformly-spaced spectral channels of 0.5/cm (apodized) resolution; and CrIS is a Michelson interferometer having 1305 spectral channels of 0.625, 1.250, and 2.50/cm (unapodized) spectral resolution, respectively, over its three continuous but non-overlapping bands. Results of tradeoff studies showing information content sensitivity to assumed measurement system characteristics will be presented