Credit rating changes’ impact on banks: evidence from the US banking industry

This study examines the impact of credit rating upgrades and downgrades on six comprehensive banks’ asset classes, profitability, leverage and size using data from the Federal Deposit Insurance Corporation’s call reports and Bloomberg over the period 1989-2008. In summary, the results suggest that a downgrade has a lasting and relatively more severe impact on banks than an upgrade; however, downgraded banks do not seem to effectively reduce their appetite for risk over a longer horizon. It seems that the role of credit rating agencies as an integral part of banks’ prudential supervision through market discipline is, in a longer horizon, overstated.Credit rating changes; banks; market discipline

Credit rating changes’ impact on banks: evidence from the US banking industry

This study examines the impact of credit rating upgrades and downgrades on six comprehensive banks’ asset classes, profitability, leverage and size using data from the Federal Deposit Insurance Corporation’s call reports and Bloomberg over the period 1989-2008. In summary, the results suggest that a downgrade has a lasting and relatively more severe impact on banks than an upgrade; however, downgraded banks do not seem to effectively reduce their appetite for risk over a longer horizon. It seems that the role of credit rating agencies as an integral part of banks’ prudential supervision through market discipline is, in a longer horizon, overstated

Credit rating changes’ impact on banks: evidence from the US banking industry

This study examines the impact of credit rating upgrades and downgrades on six comprehensive banks’ asset classes, profitability, leverage and size using data from the Federal Deposit Insurance Corporation’s call reports and Bloomberg over the period 1989-2008. In summary, the results suggest that a downgrade has a lasting and relatively more severe impact on banks than an upgrade; however, downgraded banks do not seem to effectively reduce their appetite for risk over a longer horizon. It seems that the role of credit rating agencies as an integral part of banks’ prudential supervision through market discipline is, in a longer horizon, overstated

Occupational status and life satisfaction in the UK: The miserable middle?

We use British panel data to explore the link between occupational status and life satisfaction. We find puzzling evidence for men of a U-shaped relationship in cross-section data: employees in medium-status occupations report lower life satisfaction scores than those of employees in either low- or high-status occupations. This puzzle disappears in panel data: the satisfaction of any man rises as he moves up the status ladder. The culprit seems to be immobility: the miserable middle is caused by men who have always been in medium-status occupations. There is overall little evidence of a link between occupational status and life satisfaction for women, although this relationship for higher-educated women does look more like that for men

Specific Frontostriatal Circuits for Impaired Cognitive Flexibility and Goal-Directed Planning in Obsessive-Compulsive Disorder: Evidence From Resting-State Functional Connectivity.

BACKGROUND: A recent hypothesis has suggested that core deficits in goal-directed behavior in obsessive-compulsive disorder (OCD) are caused by impaired frontostriatal function. We tested this hypothesis in OCD patients and control subjects by relating measures of goal-directed planning and cognitive flexibility to underlying resting-state functional connectivity. METHODS: Multiecho resting-state acquisition, combined with micromovement correction by blood oxygen level-dependent sensitive independent component analysis, was used to obtain in vivo measures of functional connectivity in 44 OCD patients and 43 healthy comparison subjects. We measured cognitive flexibility (attentional set-shifting) and goal-directed performance (planning of sequential response sequences) by means of well-validated, standardized behavioral cognitive paradigms. Functional connectivity strength of striatal seed regions was related to cognitive flexibility and goal-directed performance. To gain insights into fundamental network alterations, graph theoretical models of brain networks were derived. RESULTS: Reduced functional connectivity between the caudate and the ventrolateral prefrontal cortex was selectively associated with reduced cognitive flexibility. In contrast, goal-directed performance was selectively related to reduced functional connectivity between the putamen and the dorsolateral prefrontal cortex in OCD patients, as well as to symptom severity. Whole-brain data-driven graph theoretical analysis disclosed that striatal regions constitute a cohesive module of the community structure of the functional connectome in OCD patients as nodes within the basal ganglia and cerebellum were more strongly connected to one another than in healthy control subjects. CONCLUSIONS: These data extend major neuropsychological models of OCD by providing a direct link between intrinsically abnormal functional connectivity within dissociable frontostriatal circuits and those cognitive processes underlying OCD symptoms.This research was funded by a Wellcome Trust Senior Investigator Award (104631/Z/14/Z) awarded to T.W. Robbins. Work was completed at the Behavioural and Clinical Neuroscience Institute, University of Cambridge, Cambridge, UK, supported by a joint award from the Medical Research Council and Wellcome Trust (G00001354). M.M. Vaghi is supported by a Pinsent Darwin Scholarship in Mental Pathology and a Cambridge Home and EU Scholarship Scheme (CHESS) studentship. P.E. Vértes is supported by the Medical Research Council (grant no. MR/K020706/1). A.M. Apergis-Schoute is supported by the Wellcome Trust above. V. Voon is a Wellcome Trust Fellow

Perseveration and Shifting in Obsessive-Compulsive Disorder as a Function of Uncertainty, Punishment, and Serotonergic Medication

© 2023 The Author(s). Published by Elsevier Inc on behalf of the Society of Biological Psychiatry. This is an open access article distributed under the terms of the Creative Commons Attribution License (CC BY), https://creativecommons.org/licenses/by/4.0/Background The nature of cognitive flexibility deficits in obsessive-compulsive disorder (OCD), which historically have been tested with probabilistic reversal learning tasks, remains elusive. Here, a novel deterministic reversal task and inclusion of unmedicated patients in the study sample illuminated the role of fixed versus uncertain rules/contingencies and of serotonergic medication. Additionally, our understanding of probabilistic reversal was enhanced through theoretical computational modeling of cognitive flexibility in OCD. Methods We recruited 49 patients with OCD, 21 of whom were unmedicated, and 43 healthy control participants matched for age, IQ, and gender. Participants were tested on 2 tasks: a novel visuomotor deterministic reversal learning task with 3 reversals (feedback rewarding/punishing/neutral) measuring accuracy/perseveration and a 2-choice visual probabilistic reversal learning task with uncertain feedback and a single reversal measuring win-stay and lose-shift. Bayesian computational modeling provided measures of learning rate, reinforcement sensitivity, and stimulus stickiness. Results Unmedicated patients with OCD were impaired on the deterministic reversal task under punishment only at the first and third reversals compared with both control participants and medicated patients with OCD, who had no deficit. Perseverative errors were correlated with OCD severity. On the probabilistic reversal task, unmedicated patients were only impaired at reversal, whereas medicated patients were impaired at both the learning and reversal stages. Computational modeling showed that the overall change was reduced feedback sensitivity in both OCD groups. Conclusions Both perseveration and increased shifting can be observed in OCD, depending on test conditions including the predictability of reinforcement. Perseveration was related to clinical severity and remediated by serotonergic medication.Peer reviewe

Serotonin depletion amplifies distinct human social emotions as a function of individual differences in personality

Funder: Gates Cambridge Trust; doi: https://doi.org/10.13039/501100005370Abstract: Serotonin is involved in a wide range of mental capacities essential for navigating the social world, including emotion and impulse control. Much recent work on serotonin and social functioning has focused on decision-making. Here we investigated the influence of serotonin on human emotional reactions to social conflict. We used a novel computerised task that required mentally simulating social situations involving unjust harm and found that depleting the serotonin precursor tryptophan—in a double-blind randomised placebo-controlled design—enhanced emotional responses to the scenarios in a large sample of healthy volunteers (n = 73), and interacted with individual differences in trait personality to produce distinctive human emotions. Whereas guilt was preferentially elevated in highly empathic participants, annoyance was potentiated in those high in trait psychopathy, with medium to large effect sizes. Our findings show how individual differences in personality, when combined with fluctuations of serotonin, may produce diverse emotional phenotypes. This has implications for understanding vulnerability to psychopathology, determining who may be more sensitive to serotonin-modulating treatments, and casts new light on the functions of serotonin in emotional processing

Environmentalism in the EU-28 context: the impact of governance quality on environmental energy efficiency

Environmental policies are a significant cornerstone of a developed economy, but the question that arises is whether such policies lead to a sustainable growth path. It is clear that the energy sector plays a pivotal role in environmental policies, and although the current literature has focused on examining the link between energy consumption and economic growth through an abundance of studies, it does not explicitly consider the role of institutional or governance quality variables in the process. Both globalization and democracy are important drivers of sustainability, while environmentalism is essential for the objective of gaining a “better world.” Governance quality is expected to be the key, not only for economic purposes but also for the efficiency of environmental policies. To that end, the analysis in this paper explores the link between governance quality and energy efficiency for the EU-28 countries, spanning the period 1995 to 2014. The findings document that there is a nexus between energy efficiency and income they move together: the most efficient countries are in the group with higher GDP per capita. Furthermore, the results show that governance quality is an important driver of energy efficiency and, hence, of environmental policies.University of Granad

Serotonin depletion impairs both Pavlovian and instrumental reversal learning in healthy humans.

Funder: Gates Cambridge Trust; doi: https://doi.org/10.13039/501100005370Funder: DH | National Institute for Health Research (NIHR); doi: https://doi.org/10.13039/501100000272Serotonin is involved in updating responses to changing environmental circumstances. Optimising behaviour to maximise reward and minimise punishment may require shifting strategies upon encountering new situations. Likewise, autonomic responses to threats are critical for survival yet must be modified as danger shifts from one source to another. Whilst numerous psychiatric disorders are characterised by behavioural and autonomic inflexibility, few studies have examined the contribution of serotonin in humans. We modelled both processes, respectively, in two independent experiments (N = 97). Experiment 1 assessed instrumental (stimulus-response-outcome) reversal learning whereby individuals learned through trial and error which action was most optimal for obtaining reward or avoiding punishment initially, and the contingencies subsequently reversed serially. Experiment 2 examined Pavlovian (stimulus-outcome) reversal learning assessed by the skin conductance response: one innately threatening stimulus predicted receipt of an uncomfortable electric shock and another did not; these contingencies swapped in a reversal phase. Upon depleting the serotonin precursor tryptophan-in a double-blind randomised placebo-controlled design-healthy volunteers showed impairments in updating both actions and autonomic responses to reflect changing contingencies. Reversal deficits in each domain, furthermore, were correlated with the extent of tryptophan depletion. Initial Pavlovian conditioning, moreover, which involved innately threatening stimuli, was potentiated by depletion. These results translate findings in experimental animals to humans and have implications for the neurochemical basis of cognitive inflexibility.NIH