On the structural value of children and its implication on intended fertility in Bulgaria

Personal networks receive increasing recognition as structural determinants of fertility. However, the network perspective also helps to explain personal motivations for having children. Using theories of interpersonal exchange and of the value of children, it is argued that children can substantively alter and improve their parents’ social networks. Individuals perceive this potential advantageous development as a structural benefit and consider this value in their reproductive decisions. Data from Bulgaria, collected in 2002, support this argument. The intentions of females and males to have a first or second child are positively influenced by at least one structural value. Women’s intentions are promoted by the prospect that a child will bring their parents and relatives closer or will strengthen the bond with the partner. Male’s intentions are closely associated with the expectation that a child will improve their security at old age.Bulgaria, costs, decision making, fertility determinants, social capital, social network, value of children

Do International Roaming Alliances Harm Consumers?

We develop a model of international roaming in which mobile network operators (MNOs) compete both on the wholesale market to sell roaming services to foreign operators and on the retail market for subscribers. The operators own a network infrastructure only in their home country. To allow their subscribers to place or receive calls abroad, they have to buy roaming services provided by foreign MNOs. We show that in absence of international alliances and capacity restrictions, competition between foreign operators would drive wholesale unit prices down to marginal costs. However, operators prefer to form international alliances in which members mutually provide roaming services at inefficiently high wholesale prices. Alliances serve as a commitment device to soften competition on the retail market and harm consumers through excessively high per call prices. Although operators compete in two-part tariffs for subscribers, wholesale roaming prices do not exhibit profit-neutrality as do access prices in related models of net- work interconnection. We also show that international alliances are endogenously formed if not prevented by regulation.International Roaming, Vertical Relations, Regulation

Banking Regulation and Financial Accelerators: A One-Period Model with Unlimited Liability

In this paper, we analyze the consequences of bank regulation on the size of the real sector. In particular, we address the question whether exogenous shocks on the return-risk characteristics of the technology and on the equity of the real sector are intensified or damped by a value-at-risk constraint on the credit portfolio of a bank. We consider a one-period model with three risk-averse agents, an investor, a bank, and a firm. The size of the markets for deposits and loans, their prices and the size of the real sector are endogenous. We find that stricter regulation results in higher loan rates, lower deposit rates, and lower activity in the real sector. A negative shock on the return-risk position or on the risk buffer of the real sector reduces the activities in the economy. Surprisingly, the sensitivity of the real sector's activities on negative shocks is smaller for a regulated financial sector than for a non-regulated one. Therefore, in our economy, imperfections in the financial sector do not result in procyclical or acceleration effects

Explaining the Bond-CDS Basis: The role of credit risk and liquidity

We explore the relationship between CDS premia and bond asset swap spreads on the same reference entity. As Duffie (1999) shows, there is a clear theoretical link between CDS premia and bond prices if the two quantities are viewed as a pure measure of credit risk. However, many studies provide evidence that factors other than credit risk seem to affect bond prices and CDS premia, and these factors may partially obscure the relationship. We focus on the difference between the yield spread and the CDS premium, the bond-CDS basis, and show that the basis is highly sensitive to firm-specific and market wide credit risk and liquidity. If CDS and bonds are used in a dynamic hedging strategy or in a basis trading strategy that depends on the convergence of CDS and bond markets, it is necessary to correctly quantify the associated risks of these strategies. --

Social capital and fertility intentions: the case of Poland

-Poland, fertility determinants, social capital

CO2 Emission Reduction in Freight Transports How to Stimulate Environmental Friendly Behaviour?

In the European Union (EU) and in Germany the transport sector is the only sector with increasing CO2 emissions (in the EU by about 32 % and in Germany by about 1 % since 1990). Especially in road freight and air transport a further strong increase is forecasted. In the transport sector this might be impeded by avoiding transport (accepting a lower economic growth), shifting modes or in optimizing logistics. Especially the second is mentioned to be an adequate solution to meet the increasing demand for transportation and reducing CO2 emissions simulatneously. It is often stated, that combined transport (mainly truck-train-truck) might be a very CO2 efficient mode. In this article a Logit-Model (based on a survey of 500 German forwarders) is used to determine mode shift potentials of hauliers. The main factors of influence depending on the service provision of the transport modes are frequency of combined transport services, speed, and costs. For an estimation of the corresponding impact on the mode shift and thus potentials of CO2 emission reductions two policy instruments are empirically tested: a further increase of the performance-based heavy vehicle fee (LSVA-Maut) and a hypothetical speeding up of the average speed in freight rail transport to 80 km per hour. Although the modal shift is rather high in the last policy simulation, the impact on CO2 emissions is still small. --Freight Transports,CO2 Emissions,Mode Shift,Combined Transport

The value of the early unwind option in futures contracts with an endogenous basis

In this paper the implicit early unwind option of a risk neutral arbitrageur is valued. The problem is analyzed in a market microstructure framework where four different groups of market participants interact. Within this model the equilibrium price relationship between stock and futures markets is determined. Since the underlying of the option is influenced by arbitrage trading the underlying of the option depends contrary to standard option pricing theory on the unwind option itself. The non-Markovian stochastic process of the basis is characterized and the results of an extensive comparative static analysis of the option value are presented. --

Time-varying credit risk and liquidity premia in bond and CDS markets

We develop a reduced-form model that allows us to decompose bond spreads and CDS premia into a pure credit risk component, a pure liquidity component, and a component measuring the relation between credit risk and liquidity. CDS liquidity has important consequences for the bond credit risk and liquidity components. Besides the credit risk link, we document a liquidity link between the bond and the CDS market. Liquidity in both markets dries up as credit risk increases, and higher bond market liquidity leads to lower CDS market liquidity. Ignoring CDS liquidity results in partly negative liquidity premia, particularly when CDS liquidity is low. --

Radiation environment along the INTEGRAL orbit measured with the IREM monitor

The INTEGRAL Radiation Environment Monitor (IREM) is a payload supporting instrument on board the INTEGRAL satellite. The monitor continually measures electron and proton fluxes along the orbit and provides this information to the spacecraft on board data handler. The mission alert system broadcasts it to the payload instruments enabling them to react accordingly to the current radiation level. Additionally, the IREM conducts its autonomous research mapping the Earth radiation environment for the space weather program. Its scientific data are available for further analysis almost without delay.Comment: 5 pages, 7 figures, accepted for publication in A+A letter