Does relationship lending promote growth? : Savings banks and SME financing

This paper addresses the question whether close borrower-lender relationships, so called hausbank-relationships, facilitate the funding and beneficial development of SME. To this end, we derive a model which relates a firm's growth rate to its need for external funds and subsequently compute the firms that exceed their predicted growth rate. We then use this measure to identify specific characteristics that are associated with long- and short-term financing of firm growth, in particular the influence of relationship lending. We find that close ties with savings banks predict firms' access to external finance to fund growth. Moreover, the long-term liabilities of firms with hausbank-relationships almost double those with multiple relationships while the overall leverage is about the same. In turn, we find an strong empirical relationship between the provision of long-term funds and firm growth. Keywords: small business lending, credit access, public banks JEL Classifications: G21, D2

Financial constraints and the decision to lease : evidence from German SME

The objective of this paper is to test the hypothesis that in particular financially constrained firms lease a higher share of their assets to mitigate problems of asymmetric information. The assumptions are tested under a GMM framework which simultaneously controls for endogeneity problems and firms' fixed effects. We find that the share of total annual lease expenses attributable to either finance or operating leases is considerably higher for smaller firms with higher average interest rates and high-growth firms - those likely to face higher agency-cost premiums on marginal financing. Furthermore, our results confirm the substitution of leasing and debt financing for lessee firms. However, we find no evidence that firms use leasing as an instrument to reduce their tax burdens. Keywords: Leasing, financial constraints, asymmetric information, GMM JEL Classifications: D23, D92, C2

Global well-posedness for the critical 2D dissipative quasi-geostrophic equation

We give an elementary proof of the global well-posedness for the critical 2D dissipative quasi-geostrophic equation. The argument is based on a non-local maximum principle involving appropriate moduli of continuity.Comment: 7 page

Note on Global Regularity for 2D Oldroyd-B Fluids with Diffusive Stress

We prove global regularity of solutions of Oldroyd-B equations in 2 spatial dimensions with spatial diffusion of the polymeric stresses

Does IT standardization help to boost cost and profit efficiency? Empirical evidence from German savings banks

This paper investigates the impact of IT standardization on bank performance based on a panel of 457 German savings banks over the period from 1996 to 2006. We measure IT standardization as the fraction of IT expenses for centralized services over banks' total IT expenses. Bank efficiency, in turn, is measured by traditional accounting performance indicators as well as by cost and profit efficiencies that are estimated by a stochastic frontier approach. Our results suggest that IT standardization is conducive to cost efficiency. The relation is positive and robust for small and medium-sized banks but vanishes for very large banks. Furthermore, our study confirms the often cited computer paradox by showing that total IT expenditures negatively impact cost efficiency and have no influence on bank profits. To the best of our knowledge, this paper is first to empirically explore whether IT standardization enhances efficiency by employing genuine data of banks' IT expenditures. JEL Classification: C23, G21 Keywords: IT standardization, cost and profit efficiency, savings bank

Particle trajectories in linearized irrotational shallow water flows

We investigate the particle trajectories in an irrotational shallow water flow over a flat bed as periodic waves propagate on the water's free surface. Within the linear water wave theory, we show that there are no closed orbits for the water particles beneath the irrotational shallow water waves. Depending on the strength of underlying uniform current, we obtain that some particle trajectories are undulating path to the right or to the left, some are looping curves with a drift to the right and others are parabolic curves or curves which have only one loop