18 research outputs found

    How the 1981-83 Chilean banking crisis was handled

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    The banking crisis in Chile in 1981-83 was widespread - representing about 60 percent of the banking system's total portfolio. The crisis arose because of macroeconomic problems and was exacerbated by unsound financial practices. The government was faced with two extreme solutions: to let insolvent banks go bankrupt, or to bail them out, absorbingtheir losses. Some institutions were liquidated, and others were rescued and rehabilitated, depending on their solvency. The government used two types of mechanisms to rehabilitate the banking system. One type was aimed at improving borrowers'capacity to repay loans to the banks. The other was aimed at rebuilding the banking system's capital. The government also strengthened banking supervision by improving loan portfolio analysis and increasing the transparency of financial transactions. The decision to recognize and allocate losses quickly, and to implement comprehensive measures to resolve the banking crisis, were the key to Chile's success in surviving the crisis. Had allocation of losses been delayed, or solutions partial, losses would probably have increased and the system would not have recovered so rapidly.Housing Finance,Banks&Banking Reform,Financial Crisis Management&Restructuring,Financial Intermediation,Economic Theory&Research

    Financing Firms in Hibernation during the COVID-19 Pandemic

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    The coronavirus (COVID-19) pandemic has halted economic activity worldwide, hurting ļ¬rms and pushing them toward bankruptcy. This paper provides a uniļ¬ed framework to organize the policy debate related to ļ¬rm ļ¬nancing during the downturn, centered along four main points. First, the economic crisis triggered by the spread of the virus is radically diļ¬€erent from past crises, with important consequences for optimal policy responses. Second, to avoid ineļ¬€icient bankruptcies and long-term detrimental eļ¬€ects, it is important to preserve ļ¬rmsā€™ relationships with key stakeholders, like workers, suppliers, customers, and creditors. Third, ļ¬rms can beneļ¬t from ā€œhibernating,ā€ using the minimum bare cash necessary to withstand the pandemic, while using credit to remain alive until the crisis subdues. Fourth, the existing legal and regulatory infrastructure is ill-equipped to deal with an exogenous systemic shock such as this pandemic. Financial sector policies can help increase the provision of credit, while posing diļ¬€icult choices and trade-oļ¬€s

    Expression of Transposable Elements in Neural Tissues during Xenopus Development

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    Transposable elements comprise a large proportion of animal genomes. Transposons can have detrimental effects on genome stability but also offer positive roles for genome evolution and gene expression regulation. Proper balance of the positive and deleterious effects of transposons is crucial for cell homeostasis and requires a mechanism that tightly regulates their expression. Herein we describe the expression of DNA transposons of the Tc1/mariner superfamily during Xenopus development. Sense and antisense transcripts containing complete Tc1-2_Xt were detected in Xenopus embryos. Both transcripts were found in zygotic stages and were mainly localized in Spemann's organizer and neural tissues. In addition, the Tc1-like elements Eagle, Froggy, Jumpy, Maya, Xeminos and TXr were also expressed in zygotic stages but not oocytes in X. tropicalis. Interestingly, although Tc1-2_Xt transcripts were not detected in Xenopus laevis embryos, transcripts from other two Tc1-like elements (TXr and TXz) presented a similar temporal and spatial pattern during X. laevis development. Deep sequencing analysis of Xenopus tropicalis gastrulae showed that PIWI-interacting RNAs (piRNAs) are specifically derived from several Tc1-like elements. The localized expression of Tc1-like elements in neural tissues suggests that they could play a role during the development of the Xenopus nervous system

    How collateral laws shape lending and sectoral activity

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    publisher: Elsevier articletitle: How collateral laws shape lending and sectoral activity journaltitle: Journal of Financial Economics articlelink: http://dx.doi.org/10.1016/j.jfineco.2016.09.005 content_type: article copyright: Ā© 2016 Elsevier B.V. All rights reserved.publisher: Elsevier articletitle: How collateral laws shape lending and sectoral activity journaltitle: Journal of Financial Economics articlelink: http://dx.doi.org/10.1016/j.jfineco.2016.09.005 content_type: article copyright: Ā© 2016 Elsevier B.V. All rights reserved.publisher: Elsevier articletitle: How collateral laws shape lending and sectoral activity journaltitle: Journal of Financial Economics articlelink: http://dx.doi.org/10.1016/j.jfineco.2016.09.005 content_type: article copyright: Ā© 2016 Elsevier B.V. All rights reserved

    The internal labor markets of business groups

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    This paper provides novel micro evidence of labor mobility inside business groups. We show that worker flows between group firms are significantly more prevalent than between unaffiliated firms. We also find that groups respond to changing business conditions by reallocating top-occupation workers across affiliated firms. The wages of top workers increase as they move within the group. Internal labor reallocation is stronger when the workerā€™s origin firm controls the destination firm and in more complex hierarchical structures. Our results are consistent with the hypothesis that groups ease the transfer of intangible inputs, such as management practices, across firms

    Age-differentiated minimum wages in developing countries

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    The fact that minimum wages seem especially binding for young workers has led some countries to adopt age-differentiated minimum wages. We develop a dynamic competitive two-sector labor market model where workerswith heterogeneous initial skills gain productivity through experience.We compare two equally binding schemes of single and age-differentiated minimumwages, and find that although differentiated minimumwages result in a more equal distribution of income, such a scheme creates a more unequal distribution of wealth by forcing less skilled workers to remain longer in the uncovered sector.We also show that relaxing minimumwage solely for young workers reduces youth unemployment but harms the less skilled ones

    Financing Firms in Hibernation during the COVID-19 Pandemic

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