The problems of higher education funding : the case study of “Babes-Bolyai” University of Cluj-Napoca, Romania

Our study is intended to analyze: a) the issue of higher education under funding; b) the “disguised subsidizing” of higher education based on tuition fees; c) the supplementary revenues sources for universities; d) the funding mechanisms of higher education. We aim to incite debate on the relation between the educational policy and the funding strategy of higher education at both national and operational levels, instancing the case of the Babes- Bolyai University of Cluj-Napoca. The fundamental guide marks of this analysis are: the average cost per student, the budgetary allowance and the tuition fee. What sources of supplementary revenues for universities are there? What kind of scientific research provides incomes? Which university services generate supplementary resources? How can the university infrastructure be “exploited”? In what measure the cooperation and partnership opportunities with the economic and social environment are being identified? Which are the facilities, the steering directions, the conditions and the benefits of accessing European Structural Funds? With the purpose of answering these questions we have conceived a funding strategy model, entailing: regulations, institutional infrastructure, working instruments, budgetary allowance distribution models, educational costs estimation methods, funding mechanisms, all these operating in a gearing meant to attain, by solving the problems, the objectives of higher education policy.peer-reviewe

WEATHER INDEX- THE BASIS OF WEATHER DERIVATIVES

This paper approaches the subject of Weather Derivatives, more exactly their basic element the weather index. The weather index has two forms, the Heating Degree Day (HDD) and the Cooling Degree Day (CDD). We will try to explain their origin, use and the relationship between the two forms of the index. In our research we started from the analysis of the weather derivatives and what they are based on. After finding out about weather index, we were interested in understanding exactly how they work and how they influence the value of the contract. On the national level the research in the field is scares, but foreign materials available. The study for this paper was based firstly on reading about Weather Derivative, and then going in the meteorogical field and determining the way by which the indices were determined. After this, we went to the field with interest in the indices, such as the energy and gas industries, and figured out how they determined the weather index. For the examples we obtained data from the weather index database, and calculated the value for the period. The study is made on a period of five years, in 8 cities of the European Union. The result of this research is that we can now understand better the importance of the way the indices work and how they influence the value of the Weather Derivatives. This research has an implication on the field of insurance, because of the fact that weather derivative are at the convergence point of the stock markets and the insurance market. The originality of the paper comes from the personal touch given to the theoretical aspect and through the analysis of the HDD and CDD index in order to show their general behaviour and relationship.Weather derivatives, Weather Index, HDD, CDD

THE IMPACT OF THE ECONOMIC CRISIS ON CREDIT INSURANCE

The insurance domain is one of the most complex and extensive areas of the market. However this field is very risk exposed especially in this period of economic instability. One of the most non-performant insurance products at this time is the credit insurance. Due to inability to pay and increasing bad loans, insurance companies have decided to remove these products from their portfolio. We believe that the signs that led to this situation have been very visible for a long time, but the insurance market players refused to give too much importance to them because they based their operations on the artificial strength of the whole system. In this paper we want to show how things have evolved on the credit insurance market as compared to the general insurance market, and if the present situation could have been anticipated and avoided.crisis, inflation, hazard, credits, performance, panel data

THE ROMANIAN INSURANCE MARKET AND THE POTENTIAL EFFECTS OF THE CRISIS UPON IT

The global financial and economic crisis is felt in almost all the companies that operate on the European financial and insurance markets. The European insurance and re-insurance industry would register a significant decrease of the investments and a redulife insurance market, non-life insurances, financial-economic crisis

ASPECTS REGARDING THE COUTRY RISK AND ITS RATING

Is Romania affected by the country risk? Country risk, especially the score given by the rating companies is meant to lead to economic growth or recession. Is it possible for only one grade to have that much impact upon the economy? The truth is that suchcountry risk, country rating, business environment rating

The Problems of Higher Education Funding: The Case Study of “Babes-Bolyai” University of Cluj-Napoca, Romania

Our study is intended to analyze: a) the issue of higher education under funding; b) the “disguised subsidizing” of higher education based on tuition fees; c) the supplementary revenues sources for universities; d) the funding mechanisms of higher education. We aim to incite debate on the relation between the educational policy and the funding strategy of higher education at both national and operational levels, instancing the case of the Babes-Bolyai University of Cluj-Napoca. The fundamental guide marks of this analysis are: the average cost per student, the budgetary allowance and the tuition fee. What sources of supplementary revenues for universities are there? What kind of scientific research provides incomes? Which university services generate supplementary resources? How can the university infrastructure be “exploited”? In what measure the cooperation and partnership opportunities with the economic and social environment are being identified? Which are the facilities, the steering directions, the conditions and the benefits of accessing European Structural Funds? With the purpose of answering these questions we have conceived a funding strategy model, entailing: regulations, institutional infrastructure, working instruments, budgetary allowance distribution models, educational costs estimation methods, funding mechanisms, all these operating in a gearing meant to attain, by solving the problems, the objectives of higher education policy.Financing higher education, models, strategies, institutional levels, students, education budget expenditure

CATASTROPHIC EVENTS MODELING

This paper presents the emergence and evolution of catastrophe models (cat models). Starting with the present context of extreme weather events and features of catastrophic risk (cat risk) we’ll make a chronological illustration from a theoretical point of view of the main steps taken for building such models. In this way the importance of interdisciplinary can be observed. The first cat model considered contains three modules. For each of these indentified modules: hazard, vulnerability and financial losses a detailed overview and also an exemplification of a potential case of an earthquake that measures more than 7 on Richter scale occurring nowadays in Bucharest will be provided. The key areas exposed to earthquake in Romania will be identified. Then, based on past catastrophe data and taking into account present conditions of housing stock, insurance coverage and the population of Bucharest the impact will be quantified by determining potential losses. In order to accomplish this work we consider a scenario with data representing average values for: dwelling’s surface, location, finishing works. On each step we’ll make a reference to the earthquake on March 4 1977 to see what would happen today if a similar event occurred. The value of Bucharest housing stock will be determined taking firstly the market value, then the replacement value and ultimately the real value to quantify potential damages. Through this approach we can find the insurance coverage of potential losses and also the uncovered gap. A solution that may be taken into account by public authorities, for example by Bucharest City Hall will be offered: in case such an event occurs the impossibility of paying compensations to insured people, rebuilding infrastructure and public buildings and helping the suffering persons should be avoided. An actively public-private partnership should be created between government authorities, the Natural Disaster Insurance Pool, private insurance companies, reinsurers, stock exchanges, institutions specialized in cat events modeling in order to develop and use alongside compulsory and facultative insurance of buildings new alternative risk transfer solutions as catastrophe bonds(also known as cat bonds)

PRICING AND ASSESSING UNIT-LINKED INSURANCE CONTRACTS WITH INVESTMENT GUARANTEES

One of the most interesting life insurance products to have emerged in recent years in the Romanian insurance market has been the unit-linked contract. Unit-linked insurance products are life insurance policies with investment component. A unit-linked life insurance has two important components: protection and investment. The protection component refers to the insured sum in case of the occurrence of insured risks and the investment component refers to the policyholders’ account that represents the present value of the units from the chosen investment funds. Due to the financial instability caused by the Global Crisis and the amplification of market competitiveness, insurers from international markets have started to incorporate guarantees in unit-linked products. So a unit- linked life insurance policy with an asset value guarantee is an insurance policy whose benefit payable on death or at maturity consists of the greater of some guaranteed amount and the value of the units from the investment funds. One of the most challenging issues concerns the pricing of minimum death benefit and maturity benefit guarantees and the establishing of proper reserves for these guarantees. Insurers granting guarantees of this type must estimate the cost and include the cost in the premium. An important component of the activity carried out by the insurance companies is the investment of the premiums paid by policyholders in various types of assets, in order to obtain higher yields than those guaranteed by the insurance contracts, while providing the necessary liquidity for the payment of insurance claims in case of occurrence of the assumed risks. So the guaranteed benefits can be broadly matched or immunized with various types of financial assets, especially with fixed-interest instruments. According to Romanian legislation which regulates the unit-linked life insurance market, unit-linked life insurance contracts pass most of the investment risk to the policyholder and involve no investment risk for the insurer. Although the Romanian legislation authorizes the Romanian insurers to offer unit-linked contracts without investment guarantees, this research provides a proposal of a theoretical and empirical basis for pricing the unit-linked insurance contracts with incorporated investment guarantees

A COMPARATIVE ANALYSIS BETWEEN UNIT-LINKED LIFE INSURANCE AND OTHER ALTERNATIVE INVESTMENTS

The unit-linked life insurance has two important components: protection and investment. The protection component refers to the insured sum in case of the occurrence of insured risks and the investment component refers to the policyholder’s account that represents the present value of the units from the chosen investment funds.These financial products invest most of the premium paid by the insured person in the funds managed by the insurance company or an external administrator and the lower part of the premium is intended to cover the insured risk (death, disability, etc). An important component of the activity carried out by the insurance companies is the investment of the premiums paid by policyholders in various types of assets, in order to obtain higher yields than those guaranteed by the insurance contracts, while providing the necessary liquidity for the payment of insurance claims in case of occurrence of the assumed risks. This research contributes to the existing literature regarding the study of investment alternatives, with an exclusive focus on the investment in unit-linked life insurance. A special place in this study is the presentation of investments in unit-linked insurance versus other types of financial investments: deposits, treasury bills, shares (BET), currency (EURO) and gold