Measuring the Interdependence of Banks in Hong Kong

This paper assesses systemic linkages among banks in Hong Kong using the risk measure "CoVaR" derived from quantile regression. The CoVaR measure captures the co-movements of banks¡¯ default risk by taking into account their nonlinear relationship when the banks are in distress. Based on equity price information, our estimation results show that the default risks of the banks were interdependent during the recent crisis. Although local banks are generally smaller, their systemic importance is found to be similar to their international and Mainland counterparts, which may be due to a higher degree of commonality in the risk profile of local banks. Regarding the impact of external shocks on the banks, international banks are more likely to be affected by the equity price fall in the US market, while local banks are relatively more responsive to funding liquidity risk.Value-at-Risk, Systemic Risk, Risk Spillovers, Quantile Regression

Productivity pathways: climate-adjusted production frontiers for the Australian broadacre cropping industry

This study introduces two advances to the aggregate productivity index methodology typically employed by ABARES. First, it accounts for the effects of climate variability on measured productivity by matching spatial climate data to individual farms in the ABARES farm surveys database. Second, a farm-level production frontier estimation technique is employed to facilitate the decomposition of productivity change into several key components, including technical change and technical efficiency change. The study makes use of farm-level data from the ABARES Australian agricultural and grazing industries survey database. An unbalanced panel dataset is constructed containing 13 430 observations (4255 farms) over the period 1977–78 to 2007–08. Spatial climate data, including winter and summer seasonal rainfall and average maximum and minimum temperatures, were obtained via the Australian Water Availability Project. These data were mapped to individual farms using Geographic Information System methods. The study employed stochastic frontier analysis methods to estimate a production frontier with time varying technical efficiency effects of the form proposed by Battese and Coelli (1992). Production frontiers are estimated for each of the three major Grains Research and Development Corporation regions: southern, northern and western. Selected climate variables are shown to display a high degree of explanatory power over farm output. The results confirm that deterioration in average climate conditions has contributed significantly to the decline in estimated productivity over the post-2000 period. Technical change is shown to be the primary driver of productivity growth in the industry in the long run, offset by a gradual decline in technical efficiency. After controlling for climate variability, a gradual decline in the rate of technical change is still observed.Productivity Analysis,

A visual approach to sketched symbol recognition

There is increasing interest in building systems that can automatically interpret hand-drawn sketches. However, many challenges remain in terms of recognition accuracy, robustness to different drawing styles, and ability to generalize across multiple domains. To address these challenges, we propose a new approach to sketched symbol recognition that focuses on the visual appearance of the symbols. This allows us to better handle the range of visual and stroke-level variations found in freehand drawings. We also present a new symbol classifier that is computationally efficient and invariant to rotation and local deformations. We show that our method exceeds state-of-the-art performance on all three domains we evaluated, including handwritten digits, PowerPoint shapes, and electrical circuit symbols

Evaluation of a new high-throughput method for identifying quorum quenching bacteria

Quorum sensing (QS) is a population-dependent mechanism for bacteria to synchronize social behaviors such as secretion of virulence factors. The enzymatic interruption of QS, termed quorum quenching (QQ), has been suggested as a promising alternative anti-virulence approach. In order to efficiently identify QQ bacteria, we developed a simple, sensitive and high-throughput method based on the biosensor Agrobacterium tumefaciens A136. This method effectively eliminates false positives caused by inhibition of growth of biosensor A136 and alkaline hydrolysis of N-acylhomoserine lactones (AHLs), through normalization of beta-galactosidase activities and addition of PIPES buffer, respectively. Our novel approach was successfully applied in identifying QQ bacteria among 366 strains and 25 QQ strains belonging to 14 species were obtained. Further experiments revealed that the QQ strains differed widely in terms of the type ofQQenzyme, substrate specificity and heat resistance. The QQ bacteria identified could possibly be used to control disease in aquaculture