Rien ne va plus - The 2007/2008 Credit Crunch and what gambling Bankers had to do with it

The paper argues that the incidence of moral hazard played a significant role in the 2007/2008 credit crunch. In particular, bank traders subjected to asymmetric compensation structures have an incentive to take excessive risks even when the bank's shareholders would prefer prudent investment. Traders' incentives are shown to be unaffected by capital regulations, with the associated financial burden falling upon the taxpayer through deposit insurance or government bail-outs. Selected case studies further indicate that the phenomenon of “gambling traders” was widespread during the credit crunch, when high bonuses tempted bank employees to invest in risky subprime-backed securities. The intransparency of structured products and the inaccuracy of credit ratings contributed to the employees' ability to conceal the underlying risk from the banks' shareholders. The analysis points to an urgent need to reform compensation practices in the financial sector

Rien Ne Va Plus - The 2007/2008 Credit Crunch and What Gambling Bankers Had to Do With It

The paper argues that the incidence of moral hazard played a significant role in the 2007/2008 credit crunch. In particular, bank traders subjected to asymmetric compensation structures have an incentive to take excessive risks even when the bank's shareholders would prefer prudent investment. Traders' incentives are shown to be unaffected by capital regulations, with the associated financial burden falling upon the taxpayer through deposit insurance or government bail-outs. Selected case studies further indicate that the phenomenon of “gambling traders” was widespread during the credit crunch, when high bonuses tempted bank employees to invest in risky subprime-backed securities. The intransparency of structured products and the inaccuracy of credit ratings contributed to the employees' ability to conceal the underlying risk from the banks' shareholders. The analysis points to an urgent need to reform compensation practices in the financial sector.

Commitment savings products: theory and evidence

Recent literature promotes commitment products as a new remedy for overcoming self-control problems and savings constraints. This thesis argues that the effects of commitment may be very heterogeneous, and highlights the mechanisms under which commitment may reduce welfare, rather than increase it. It also examines a new type of commitment contract: A formal commitment savings account with fixed regular instalments, introduced in a developing-country context. Chapter 1 proposes that the popularity of costly or inflexible savings mechanisms as well as of high-interest consumption loans may represent a demand for commitment to fixed instalments. Using a newly collected dataset from Bangladesh, it shows that the introduction of a regular-instalment commitment savings product was associated with a large increase in average savings contributions. The theoretical framework in Chapter 2 highlights the potential heterogeneity behind such positive average effects: Commitment improves welfare when agents have full knowledge of their preferences, including biases and inconsistencies. If agents are imperfectly informed about their preferences, they may choose ill-suited commitment contracts. I formally show that commitment contracts can reduce welfare if the commitment is not strong enough to discipline the agent, resulting in costly default. I further show that such insufficient commitment contracts are likely to be selected by time-inconsistent agents with ‘partially sophisticated’ preferences: Agents who are neither completely unaware nor fully aware of their time-inconsistency, but anywhere in between those two extremes. Chapter 3 describes a randomised experiment in the Philippines: I designed and introduced a regular-instalment commitment savings product, intended to improve on pure withdrawal-restriction products by mimicking the fixed-instalment nature of loan repayment contracts. Individuals from a general low-income pop ulation were randomly offered to take up the product, and were asked to choose the stakes of the contract (in the form of a default penalty) themselves. The result is that a majority appears to choose a harmful contract: While the intent-to-treat effect on bank savings for individuals assigned to the treatment group is four times that of a withdrawal-restriction product (offered as a control treatment), 55 percent of clients default on their savings contract. The explanation most strongly supported by the data is that the chosen stakes were too low (the commitment was too weak) to overcome clients’ self-control problems. Moreover, both take-up and default are negatively predicted by measures of sophisticated hyperbolic discounting, suggesting that those who are fully aware of their bias realise the commitment is too weak for them, and avoid the product. The study suggests that research on new commitment products should carefully consider the risk of adverse welfare effects, particularly for naïve and partially sophisticated hyperbolic discounters

Mikrokredite für Frauen: Instrument zur Akkumulation von symbolischem Kapital?! Empowermentmaßnahmen als Basis für genderspezifischen sozialen Wandel am Beispiel des Mikrokreditsektors in Mittelägypten

Im vorliegenden Beitrag wird die Möglichkeit diskutiert, genderspezifischen sozialen Wandel in Schwellen- und Entwicklungsländern über Mikrokreditvergabesysteme anzustoßen. Anhand einer in Mittelägypten durchgeführten Studie mit mehrfach diskriminierten Frauen wird gezeigt, wie Mikrokredite die Akkumulation nicht nur von ökonomischem, sondern vor allem auch von kulturellem und sozialem Kapital im Bourdieu'schen Sinne unterstützen können. Wenn in diesem Kontext eine Veränderung des symbolischen Kapitals gelingt, kann dies zu neuen Wahrnehmungs-, Denk- und Handlungsschemata der Beteiligten und zu Strukturveränderungen auf der Makroebene führen. Die theoretische Modellierung von genderspezifischem sozialem Wandel erfolgt in diesem Artikel entlang empirischer Daten, die von den Autorinnen in Mittelägypten erhoben wurden

Forest-derived lignin biomarkers in an Australian oxisol decrease substantially after 90 years of pasture

The dynamics of soil organic matter are a key factor in controlling the terrestrial carbon cycle. Compound specific stable carbon isotope analysis has given new insight in to the stability of individual organic molecules in soil. For lignin, one of the major plant compounds, available data suggest the existence of both a labile (turnover time <1 year) and a relatively stable (turnover time in the range of decades) pool. However, these data derive almost exclusively from agricultural soils in temperate climates. In order to extend the range both in ecosystem type and observed time span, we analysed a pasture soil in subtropical Australia that had experienced a land use change from rainforest 90 years earlier. We determined the concentration and isotopic signature of lignin biomarkers and compared them to those in an existing rainforest soil nearby and to samples of the respective vegetation. The land use change shifted both the relative abundance of lignin biomarkers and their isotopic signatures. In particular, the isotope data indicate that the pasture soil contains only small proportions of inherited rainforest-derived lignin biomarkers, which are mostly close to or below detection limit. These drastic changes in biomarker composition indicate that the original lignin structure had little chance to persist in this soil over a century. Thus, the stable soil organic carbon identified an earlier study of this soil is probably highly altered material and lignin biomarkers are not a suitable proxy of this stable carbon

Abfallpolitik in Nagasaki, Hannover und Halle

In der vorliegenden Arbeit wird die Abfallpolitik in Deutschland and Japan untersucht. Und schwerpunktmassig ist die Abfallpolitik auf der kommunalen Ebene das Hauptthema. In unserer Arbeit wurden zwei deutsche Stadte und eine japanische Stadt gewahlt. Diese Wahl hat personliche Grunde. Einer der Mitautoren arbeitet in der Stadt Nagasaki. 2005 hat er als Gastdozent ein Semester lang in Halle ein Hauptseminar geleitet. Dabei wurden zusammen mit deutschen Studenten die Umweltstrategien in Japan und besonders in Nagasaki untersucht. Eine japanische Mitautorin ist Absolventin der Universitat Nagasaki und hat die Stadt Hannover besucht. Aus diesem Grund ergab es sich, die Abfallwirtschaft in Japan exemplarisch am Beispiel Nagasaki and die Abfallwirtschaft in Deutschland exemplarisch am Beispiel Hannover und Halle zu vergleichen. Im ersten Kapitel der vorliegenden Arbeit wind die Abfallpolitik in Deutschland, zunachst auf Bundesebene und dann in den Stadten Halle und Hannover behandelt. Im zweiten Kapitel wird die Abfallpolitik in Japan, zuerst auf der staatlichen Ebene und darn im Bereich der Stadt Nagasaki betrachtet. Die staatlichen Abfallgesetze, deren Einfluss auf die kommunale Abfallpolitik, Massnahmen zur Reduzierung von Abfallen, das Abfallaufkommen usw., werden behandelt und untersucht.Im dritten Kapitel folgt ein Vergleich der Abfallpolitik deutscher and japanischer Stadte, sowie einige Schlussbemerkungen

Contribution of syndecans to cellular internalization and fibrillation of amyloid-β (1–42)

Intraneuronal accumulation of amyloid-beta(1-42) (A beta 1-42) is one of the earliest signs of Alzheimer's disease (AD). Cell surface heparan sulfate proteoglycans (HSPGs) have profound influence on the cellular uptake of A beta 1-42 by mediating its attachment and subsequent internalization into the cells. Colocalization of amyloid plaques with members of the syndecan family of HSPGs, along with the increased expression of syndecan-3 and -4 have already been reported in postmortem AD brains. Considering the growing evidence on the involvement of syndecans in the pathogenesis of AD, we analyzed the contribution of syndecans to cellular uptake and fibrillation of A beta 1-42. Among syndecans, the neuron specific syndecan-3 isoform increased cellular uptake of A beta 1-42 the most. Kinetics of A beta 1-42 uptake also proved to be fairly different among SDC family members: syndecan-3 increased A beta 1-42 uptake from the earliest time points, while other syndecans facilitated A beta 1-42 internalization at a slower pace. Internalized A beta 1-42 colocalized with syndecans and flotillins, highlighting the role of lipid-rafts in syndecan-mediated uptake. Syndecan-3 and 4 also triggered fibrillation of A beta 1-42, further emphasizing the pathophysiological relevance of syndecans in plaque formation. Overall our data highlight syndecans, especially the neuron-specific syndecan-3 isoform, as important players in amyloid pathology and show that syndecans, regardless of cell type, facilitate key molecular events in neurodegeneration

Unklare chronische Schwindelsyndrome – Erfahrungen mit einem interdisziplinären stationären Diagnostikkonzept

Dizziness is a common leading symptom. Especially patients with chronic vertigo syndromes experience a significant impairment in quality of life up to a limitation of their ability to work in the case of employed persons. The consequences are financial and capacitive burdens on the health system due to frequently multiple examinations and sick leave up to occupational invalidity of the affected patient. In 150 patients with chronic vertigo syndromes and an unclear outpatient diagnosis, at least one diagnosis that justified the complaint was made in over 90% of cases on the basis of a structured interdisciplinary inpatient diagnostic concept. Chronic vertigo syndromes are often multifactorial. Psychosomatic (accompanying) diagnoses were found in more than half of the patients. Targeted therapy can only be recommended after establishing a specific diagnosis. This justifies an interdisciplinary inpatient diagnostic concept for persistently unclear cases

Rien Ne Va Plus - The 2007/2008 Credit Crunch And What Gambling Bankers Had to Do With It

The paper argues that the incidence of moral hazard played a significant role in the 2007/2008 credit crunch. In particular, bank traders subjected to asymmetric compensation structures have an incentive to take excessive risks even when the bank's shareholders would prefer prudent investment. Traders' incentives are shown to be unaffected by capital regulations, with the associated financial burden falling upon the taxpayer through deposit insurance or government bail-outs. Selected case studies further indicate that the phenomenon of “gambling traders” was widespread during the credit crunch, when high bonuses tempted bank employees to invest in risky subprime-backed securities. The intransparency of structured products and the inaccuracy of credit ratings contributed to the employees' ability to conceal the underlying risk from the banks' shareholders. The analysis points to an urgent need to reform compensation practices in the financial sector

Determinants of urbanization

In light of the United Nations' (UN) latest urbanization projections, particularly with respect to India and the People's Republic of China, a good understanding is needed of what drives aggregate urbanization trends. Yet, previous literature has largely neglected the issue in favor of studying urban concentration. Taking advantage of the latest UN World Urbanization Prospects, we use an instrumental variables approach to identify and analyze key urbanization determinants. We estimate the impact of gross domestic product (GDP) growth on urbanization to be large and positive. In answer to Henderson's (2003) finding that urbanization does not seem to cause growth, we argue that the direction of causality runs from growth to urbanization. We also find positive and significant effects of industrialization and education on urbanization, consistent with the existence of localization economies and labor market pooling