The Procyclical Effects of Bank Capital Regulation

We assess the procyclical effects of bank capital regulation in a dynamic equilibrium model of relationship lending in which banks are unable to access the equity markets every period. Banks anticipate that shocks to their earnings as well as the cyclical position of the economy can impair their capacity to lend in the future and, as a precaution, hold capital buffers. We find that under cyclically-varying risk-based capital requirements (e.g. Basel II) banks hold larger buffers in expansions than in recessions. Yet, these buffers are insufficient to prevent a significant contraction in the supply of credit at the arrival of a recession. We show that cyclical adjustments in the confidence level underlying Basel II can reduce its procyclical effects on the supply of credit without compromising banks’ long-run solvency targets.Banking regulation;Basel II;Business cycles;Capital requirements;Credit crunch;Loan defaults;Relationship banking

Spatial and temporal variability of CO2 emisions in soils under conventional tillage and no-till farming

Agricultural soils can act as a carbon sink depending on the soil management practices employed. As a result of this functional duality, soil management systems are present in international documents relating to climate change mitigation. Agricultural practices are responsible for 14% of total greenhouse gas emissions (GHG’s) (MMA, 2009)(1). Conservation agriculture (CA) is one of the most effective agricultural systems for reducing CO2 emissions, as it increases the sequestration of atmospheric carbon in the soil. In order to assess the performance of CA in terms of CO2 emissions, a field trial was conducted comparing soil derived CO2 fluxes under No-till (NT) farming and under conventional tillage. Three pilot farms were selected in the cereal-growing area of southern Spain, located in Las Cabezas de San Juan (Seville), Carmona (Seville) and Cordoba. Each pilot farm comprises six experimental plots with an approximate area of five hectares; three of the six plots implement CA practices, while the other three use conventional tillage techniques. The subdivision of each tillage system into 3 plots allowed the simultaneous cropping of the three crops of the wheat-sunflower-legume rotation each year. Results showed that carbon dioxide emissions were 31 to 91% higher in tilled soils than in untilled soils, and that there was a great seasonal variability of CO2 emissions, as weather conditions also differed considerably for the different sampling periods. In all cases, the CO2 fluxes emitted into the atmosphere were always higher when soil was subject to conventional tillage

Effect of agronomic and environmental factors on CO2 emissions on a dryland rotation

Agriculture is a substantial source of greenhouse gas emissions (GHG) in many countries. Conservation agriculture includes soil management systems that help to reduce CO2 emission levels. However, there are many factors involved in the production of these emissions such as soil management type and time at which the agriculture operations are performed, crop phenological state, the weather, and handling of the residue amongst others. In the long term, the relationships that exist between these factors seem to determine the balance of these emissions. In this study, we analyzed the influence of the soil management system as well as the climatology of the different seasons studied and the phenological state of the different crops implanted. For this purpose a field trial was conducted in Las Cabezas de San Juán (Seville). This pilot farm consisted of six experimental plots with an approximate area of 5 ha; conservation agriculture practices were employed in three of the six plots while traditional tillage management was used in the other three. Within these plots the three crops of the wheat-sunflower-legume rotation were tested simultaneously. The study was conducted over four agricultural seasons - 2009/10, 2010/11, 2011/12 and 2012/13. Each of these cropping seasons were characterised by very different rainfall amounts, registering a total of 814.4, 721.6, 268.2 and 676.4 l/m2, respectively. When we studied the evolution of emissions over four seasons, an increase could be observed for both management systems during the time in which the crops were established due to the roots respiration processes. These increases were heavily influenced by the rainfall recorded during the time in which the crop was in place. In the case of wheat, higher emissions were produced during the cultivation time of the first and fourth season during which 84% and 60% of the total rainfall of each season was recorded. These emissions were 9 and 5 kg CO2/ha for conventional tillage and no tillage, respectively for the 2009/10 season and 11.7 and 6.8 kg CO2/ha, respectively in the 2012/13 season. Conversely during the 2011/12 season, a season in which lower precipitation was registered, the higher emissions were comparatively minor with respect to the previous values, specifically 3.7 and 1.9 kg CO2/ha for non-tillage and conventional tillage

Conditional Allocation of Control Rights in Venture Capital Finance

When a young entrepreneurial firm matures, it is often necessary to replace the founding entrepreneur by a professional manager. This replacement decision can be affected by the private benefits of control enjoyed by the entrepreneur which gives rise to a conflict of interest between the entrepreneur and the venture capitalist. We show that a combination of convertible securities and contingent control rights can be used to resolve this conflict efficiently. This contractual arrangement is frequently observed in venture capital finance

DMPSA appliCation reduces N2O emissions from exogenous NH4 + and NO3 - sources in irrigated maize

Agriculture is a major anthropogenic source of nitrous oxide (N2O). Application of nitrogenous (N) fertilizers enhances the emission of this greenhouse gas (GHG), mainly due to the biogenic processes of nitrification and denitrification. The use of nitrification inhibitors (NIs), that delay the microbial oxidation of NH4 + to NO3 -, has been reported as a successful tool for mitigating N2O losses. In this context, a field experiment using 15N labeled fertilizers was carried out in an irrigated Mediterranean maize field aiming to evaluate the effectiveness of the NI 2-(3,4-dimethyl-1H-pyrazol-1-yl) succinic acid isomeric mixture (DMPSA) on mitigating N2O emissions, and assess the processes involved in its production. The experiment, performed in 1 m2 microplots, involved the application of 15NH4NO3 or NH4 15NO3 - (with and without DMPSA) to quantify the amount of N2O coming from exogenous NH4 +, exogenous NO3 - and endogenous soil N. The resulting N2O fluxes confirmed that the addition of DMPSA led to a significant (54%) abatement of this GHG. In this experiment, both nitrification and denitrification were partially inhibited by DMPSA. When NI was not applied, the largest N2O emissions were expected from NH4 + than from NO3 --based fertilizers due to nitrification

Making Climate Change Mitigation and Adaptability Real in Africa with Conservation Agriculture

In this report, the authors have gathered essential information on how the agricultural sector can respond to climate change through Conservation Agriculture (CA). This document aims to serve as a basis for decision-making based on science and agricultural experimentation in Africa

Peculiarities of selecting the gearboxes and wheel shift coefficients in the optimization of drive gear transmissions

В якості вузлового моменту оптимізаційного проектування тягових зубчастих передач залізничного рухомого складу виділено процедуру обґрунтованого вибору коефіцієнтів зміщення шестерень і коліс за рахунок використання відповідних блокувальних контурів. Обґрунтовано актуальність досліджень з розроблення методичного забезпечення для раціонального отримання блокувальних контурів при проектуванні тягових зубастих передач. Представлені розроблені математичні залежності, що пов’язують фіксовані величині обмежувальних і контрольованих параметрів передач з числами зубців і коефіцієнтами зміщення шестерні та колеса. Їх використання дозволяє отримувати конкретні блокувальні контури для вибору коефіцієнтів зміщення шестерні та колеса при оптимізаційному проектуванні тягових зубчастих передач з різними початковими параметрами. Наведено приклад практичної реалізації розроблених математичних залежностей при отриманні блокувального контуру для вибору коефіцієнтів зміщення шестерні та колеса тягової зубчастої передачі сучасного магістрального вантажного тепловозу. Зроблено висновок про доцільність використання запропонованого методичного забезпечення при оптимізаційному проектуванні тягових зубчатих передач.As a key point in the optimization design of traction gears of the railway rolling stock, a procedure for a reasonable choice of the coefficients for the displacement of gears and wheels is provided by using the appropriate blocking circuits. The relevance of studies on the development of methodological support for the rational production of blocking contours in the design of traction-toothed gears is substantiated. The developed mathematical dependences connecting the fixed values of the limiting and controlled parameters of the gears with the numbers of the teeth and the gearing coefficients of the gears and wheels are presented. Their use makes it possible to obtain specific blocking contours for the selection of gear and wheel bias coefficients in the optimization design of traction gears with different initial parameters. An example of the practical implementation of the developed mathematical dependencies in obtaining a blocking contour for selecting the gear displacement coefficients and the traction gear wheel of a modern mainline freight locomotive is given. The conclusion is made about the expediency of using the proposed methodological support in the optimization design of traction gears

Towards a measure of financial fragility

This paper proposes a measure of financial fragility that is based on economic welfare in a general equilbrium model calibrated against UK data. The model comprises a household sector, three active heterogeneous banks, a central bank/regulator, incomplete markets, and endogenous default. We address the impact of monetary and regulatory policy, credit and capital shocks in the real and financial sectors and how the response of the economy to shocks relates to our measure of financial fragility. Finally we use panel VAR techniques to investigate the relationships between the factors that characterise financial fragility in our model, i.e. banks’ probabilities of default and banks’ profits - to a proxy of welfare