Why do banks disappear? The determinants of U.S. bank failures and acquisitions

This paper examines the determinants of individual bank failures and acquisitions in the United States during 1984-1993. We use bank-specific information suggested by examiner CAMEL-rating categories to estimate competing-risks hazard models with time-varying covariates. We focus especially on the role of management quality, as reflected in alternative measures of x-efficiency and find the inefficiency increases the risk of failure, while reducing the probability of a bank's being acquired. Finally, we show that the closer to insolvency a bank is, as reflected by a low equity-to-assets ratio, the more likely its acquisition.Bank failures

New evidence on returns to scale and product mix among U.S. commercial banks

Numerous studies have found that banks exhaust scale economies at low levels of output, but most are based on the estimation of parametric cost functions which misrepresent bank cost. Here we avoid specification error by using nonparametric kernal regression techniques. We modify measures of scale and product mix economies introduced by Berger et al. (1987) to accommodate the nonparametric estimation approach, and estimate robust confidence intervals to assess the statistical significance of returns to scale. We find that banks experience increasing returns to scale up to approximately $500 million of assets, and essentially constant returns thereafter. We also find that minimum efficient scale has increased since 1985.Banks and banking ; Banks and banking - Costs ; Economies of scale

Evaluating the efficiency of commercial banks: does our view of what banks do matter?

Bank management

The Education and Training of Artisans for the Informal Sector in Tanzania

Teaching/Communication/Extension/Profession,

Automatic document classification of biological literature

Background: Document classification is a wide-spread problem with many applications, from organizing search engine snippets to spam filtering. We previously described Textpresso, a text-mining system for biological literature, which marks up full text according to a shallow ontology that includes terms of biological interest. This project investigates document classification in the context of biological literature, making use of the Textpresso markup of a corpus of Caenorhabditis elegans literature. Results: We present a two-step text categorization algorithm to classify a corpus of C. elegans papers. Our classification method first uses a support vector machine-trained classifier, followed by a novel, phrase-based clustering algorithm. This clustering step autonomously creates cluster labels that are descriptive and understandable by humans. This clustering engine performed better on a standard test-set (Reuters 21578) compared to previously published results (F-value of 0.55 vs. 0.49), while producing cluster descriptions that appear more useful. A web interface allows researchers to quickly navigate through the hierarchy and look for documents that belong to a specific concept. Conclusions: We have demonstrated a simple method to classify biological documents that embodies an improvement over current methods. While the classification results are currently optimized for Caenorhabditis elegans papers by human-created rules, the classification engine can be adapted to different types of documents. We have demonstrated this by presenting a web interface that allows researchers to quickly navigate through the hierarchy and look for documents that belong to a specific concept

Explaining bank failures: deposit insurance, regulation, and efficiency

This paper uses micro-level historical data to examine the causes of bank failure. For state charactered Kansas banks during 19 10-28, time-to-failure is explicitly modeled using a proportional hazards framework. In addition to standard financial ratios, this study includes membership in the voluntary state deposit insurance system and measures of technical efficiency to explain bank failure. The results indicate that deposit insurance system membership increased theprobability of failure and banks which were technically inefficient were more likely to fail than technically efficient banks.Bank failures

Destined for (Un)Happiness: Does Childhood Predict Adult Life Satisfaction?

In this paper we address the question of how much of adult life satisfaction is predicted by childhood traits, parental characteristics and family socioeconomic status. Given the current focus of many national governments on measuring population well-being, and renewed focus on effective policy interventions to aid disadvantaged children, we study a cohort of children born in a particular week in 1958 in Britain who have been repeatedly surveyed for 50 years. Importantly, at four points in their adult lives this cohort has been asked about their life satisfaction (at ages 33, 42, 46, and 50). A substantive finding is that characteristics of the child and family at birth predict no more than 1.2% of the variance in average adult life satisfaction. A comprehensive set of child and family characteristics at ages 7, 11 and 16 increases the predictive power to only 2.8%, 4.3% and 6.8%, respectively. We find that the conventional measures of family socioeconomic status, in the form of parental education, occupational class and family income, are not strong predictors of adult life satisfaction. However, we find robust evidence that non-cognitive skills as measured by childhood behavioural-emotional problems, and social maladjustment, are powerful predictors of whether a child grows up to be a satisfied adult. We also find that some aspects of personality are important predictors. Adding contemporaneous adulthood variables for health and socio-economic status increases the predictability of average life satisfaction to 15.6%, while adding long-lags of life satisfaction increases the predictive power to a maximum of 35.5%. Repeating our analyses using data from the 1970 British Cohort Study confirms our main findings. Overall, the results presented in the paper point to average adult life satisfaction not being strongly predictable from a wide-range of childhood and family characteristics by age 16, which implies that there is high equality of opportunity to live a satisfied life, at least for individuals born in Britain in 1958 and 1970.childhood, socioeconomic status, life satisfaction, non-cognitive, cognitive

Happiness Dynamics with Quarterly Life Event Data

This paper addresses the question of when and to what extent individuals are affected by major positive and negative life events, including changes in financial situation, marital status, death of child or spouse and being a victim of crime. The key advantage of our data is that we are able to identify these events on a quarterly basis rather than on the yearly basis used by previous studies. We find evidence that life events are not randomly distributed, that individuals to a large extent anticipate major events and that they quickly adapt. These effects have important implications for the calculation of monetary values needed to compensate individuals for life events such as crime or death of spouse. We find that our new valuation methodology that incorporates these dynamic factors produces considerably smaller compensation valuations than those calculated using the standard approach.life satisfaction, life events, adaptation, compensation

Cosmology with liquid mirror telescopes

Liquid mirrors provide an exciting means to obtain large optical telescopes for substantially lower costs than conventional technologies. The liquid mirror concept has been demonstrated in the lab with the construction of a diffraction limited 1.5 m mirror. The mirror surface, using liquid mercury, forms a perfect parabolic shape when the mirror cell is rotated at a uniform velocity. A liquid mirror must be able to support a heavy mercury load with minimal flexure and have a fundamental resonant frequency that is as high as possible, to suppress the amplitude of surface waves caused by small vibrations transmitted to the mirror. To minimize the transmission of vibrations to the liquid surface, the entire mirror rests on an air bearing. This necessitates the mirror cell being lightweight, due to the limited load capabilities of the air bearing. The mirror components must also have physical characteristics which minimize the effects of thermal expansion with ambient temperature fluctuations in the observatory. In addition, the 2.7 m mirror construction is designed so that the techniques used may be readily extended to the construction of large mirrors. To attain the goals of a lightweight, rigid mirror, a composite laminant construction was used. The mirror consists of a foam core cut to the desired parabolic shape, with an accuracy of a few mm. An aluminum hub serves as an anchor for the foam and skin, and allows precise centering of the mirror on the air bearing and drive system. Several plys of Kevlar, covered in an epoxy matrix, are then applied to the foam. A final layer of pure epoxy is formed by spin casting. This final layer is parabolic to within a fraction of a mm. An aluminum ring bonded to the circumference of the mirror retains the mercury, and incorporates stainless-steel hard-points for the attachment of balance weights