Designing incentive-compatible regulation in banking: the role of penalty in the precommitment approach

This paper was presented at the conference "Financial services at the crossroads: capital regulation in the twenty-first century" as part of session 4, "Incentive-compatible regulations: views on the precommitment approach." The conference, held at the Federal Reserve Bank of New York on February 26-27, 1998, was designed to encourage a consensus between the public and private sectors on an agenda for capital regulation in the new century.Bank capital ; Risk ; Bank supervision

A Theoretical Analysis of Narrow Banking Proposals

The purpose of this paper is to examine narrow banking proposals. First, we survey the narrow banking proposals presented in the United States and Japan, and categorize them by means of two standards: (1) whether safe assets that a narrow bank is allowed to hold are limited to short-term assets, and (2) whether a narrow bank is allowed to engage in lending activity. Second, we examine the feasibility of each proposal for the purpose of achieving the stability of the financial system, making use of two theoretical models: Wallace (1996) and Kashyap, Rajan, and Stein (1998). Finally, we conclude that a desirable narrow bank is one that carries out both deposit-taking and lending activities, though restrictively, and is allowed to invest in short-term safe assets.

Microscopic analysis of saltation of particles on an obliquely oscillating plate

This paper presents a microscopic analysis of the saltation of particles on an obliquely oscillating plate driven by sine waves with an amplitude on the order of tens of micrometers and a frequency on the order of hundreds of hertz. To examine the effect of the diameter of a particle on its motion, the trajectories and velocities of different-sized particles, from 0.5 to 500 μm in mass median diameter, are analyzed using images captured by a high-speed microscope camera. The results show that larger particles bounce higher, whereas smaller particles easily agglomerate and bounce only slightly, owing to the low restitution caused by their loosely packed structure. In addition, larger particles bounce forward and backward repeatedly, while the agglomerated particles always bounce forward, and consequently have the highest transport velocity among these particles. The particle motion and the transport velocity can be explained by a theoretical probability model

Analysis of Behavior of Small Agglomerated Particles on Two-dimensional Vibrating Plate

"Powders and Grains 2013"; Conference date: 8–12 July 2013; Location: Sydney, AustraliaThe movement of particles in the range from 0.5 to 500 μm in mass median diameter on a two-dimensional vibrating plate is observed through a high-speed digital camera with a zoom lens. The results show that larger particles saltate higher, while smaller particles easily agglomerate and slightly saltate because of the low restitution of their loosely packed structure. The salation heights are in good agreement with the results calculated by a model based on gravity, adhesion, drag force, and restitution

The Comparative Analysis of Settlement Systems

After a rapid expansion of financial transactions, both the authorities and financial institutions became aware of the risk involved in interbank settlement systems. To cope with the risk the systems in most economies have been designed so that large-sized payments are settled in the real time gross settlement (RTGS) mode, whereas small ones are dealt with in the designated time net settlement system. Yet the introduction of the RTGS system imposes substantial costs of maintaining intraday liquidity on participants, which creates a fear among European as well as Japanese banking communities that they might lose competitiveness against their US counterparts whose main settlement system, Fedwire, does not require collateral. We first compare these different settlement systems from the participant’s cost-benefit perspective and see if this concern always holds. Second, we develop the same framework to analyse the net settlement system, and then suggest if there is a rationale behind the coexistence of both the RTGS and net settlement systems.Intraday liquidity; Risk Management; RTGS; Settlement Risk

Microscopic analysis of particle detachment from an obliquely oscillating plate

Particle detachment from an obliquely oscillating plate was studied experimentally and theoretically. The plate was placed in a horizontal position, and vibrations were applied in the horizontal and vertical directions by piezoelectric vibrators. The frequency of vibration was constant at 280 Hz. The amplitude of vibration increased with time and approached a constant value in each experiment. The movement of micrometer-sized spherical particles was analyzed using images captured by a high-speed microscope camera, which showed that the particles rolled on the plate before detaching from the surface, and that the rolling significantly reduced the adhesive force between the particles and surface. Furthermore, the removal efficiency, defined by the number ratio of detached particles to total particles, was analyzed as a function of the horizontal and vertical vibration accelerations. It was found that the removal efficiency was significantly affected by the horizontal vibration acceleration. These experimental results can be explained by the force and moment balance model

Modernising Canada's Agricultural Policies

The agricultural sector in Canada is relatively large, compared to those in most other G7 countries. In recent years, the federal and provincial governments have undertaken a number of sectoral reforms to meet the competitiveness and environmental challenges that it faces. The federal government has tried to end a marketing monopoly in the barley market and may do so for wheat as well. The next generation of agriculture and agri-food policy is being finalised, and implementation of the first part of a new framework, Growing Forward, has begun. But a steady stream of ad hoc programmes in recent years has had significant budgetary costs and no doubt created moral hazard among farmers. There is scope for further liberalisation in supply-managed sectors, which are heavily protected and subsidised by consumers. Moreover, Canada’s bio-energy production, in particular the production of second-generation bio-ethanol (from cellulose), is under pressure in light of less costly bio-energy production overseas. Against this background, governments are striving to ensure the long-term viability of the sector. This Working Paper relates to the 2008 OECD Economic Survey of Canada (www.oecd.org/eco/surveys/canada). Moderniser la politique agricole du Canada Le Canada dispose d’un secteur agricole relativement important, par rapport à la plupart des autres pays du G7. Ces dernières années, des réformes ont été entreprises dans plusieurs domaines, au niveau fédéral et provincial, pour surmonter les problèmes de compétitivité et d’environnement auxquels est confrontée l’agriculture. Le gouvernement fédéral a tenté de mettre fin à un monopole sur la commercialisation de l’orge et pourrait envisager la même démarche pour le blé. La nouvelle politique agricole et agroalimentaire est en cours de finalisation et la mise en oeuvre de la première partie d’un nouveau cadre stratégique, Cultivons l'avenir, a commencé. Mais les programmes ad hoc qui se sont succédé depuis peu ont pesé lourdement sur le budget, non sans créer un aléa moral pour les agriculteurs. Il est possible d’aller plus loin dans la libéralisation des filières soumises à une gestion de l’offre, qui sont largement protégées et subventionnées par les consommateurs. Par ailleurs, la production canadienne de bioénergie, notamment de bioéthanol de seconde génération (à partir de cellulose), est concurrencée par une production bioénergétique étrangère moins coûteuse. C’est dans ce contexte que s’inscrivent les efforts déployés par les pouvoirs publics pour assurer la viabilité du secteur à long terme. Ce Document de travail se rapporte à l’Étude économique de l’OCDE du Canada, 2008 (www.oecd.org/eco/etudes/canada).agriculture, supply management, Canada, biofuels, gestion de l’offre, bioéthanol, Canada, agriculture