Showing papers on "Shadow (psychology) published in 2015"

What is Shadow Banking

Abstract: There is much confusion about what shadow banking is. Some equate it with securitization, others with non-traditional bank activities, and yet others with non-bank lending. Regardless, most think of shadow banking as activities that can create systemic risk. This paper proposes to describe shadow banking as “all financial activities, except traditional banking, which require a private or public backstop to operate”. Backstops can come in the form of franchise value of a bank or insurance company, or in the form of a government guarantee. The need for a backstop is in our view a crucial feature of shadow banking, which distinguishes it from the “usual” intermediated capital market activities, such as custodians, hedge funds, leasing companies, etc.

European populism in the shadow of the great recession

Abstract: European Populism in the Shadow of the Great Recession tem como objetivo analisar a forma como a recente crise económica e financeira potenciou o aumento do populismo na Europa. Os autores começam por reconhecer que o crescimento do populismo não é consequência apenas da crise, constituindo antes um processo de longo prazo, fruto do mau funcionamento da democracia representativa de um modo geral e, mais concretamente, dos sistemas partidários europeus, que deveriam desempenhar o papel de ligação entre cidadãos e processos de tomada de decisões políticas. Estes problemas, por sua vez, têm origens diferentes, consoante a região europeia que se considere. Na Europa Ocidental são consequência de uma redução da capacidade de mobilização dos partidos políticos mainstream, enquanto na Europa Central e de Leste resultam de os sistemas partidários dessa região nunca se terem chegado a institucionalizar, o que, aliado aos fortes sentimentos antielites que aí se fazem sentir, facilitou o aparecimento do populismo. Os autores chamam também a atenção para a necessidade de distinguir entre crise económica e crise política. Apesar de haver uma forte relação entre ambas e de muitos países terem sofrido tanto uma como outra, estas constituem fenómenos distintos a nível teórico e empírico, não devendo assim ser confundidos. Posto isto, a questão a que a obra procura responder é a de até que ponto estes dois tipos de crise agudizaram a tendência de longo prazo no sentido de um crescimento do populismo no espaço europeu. Desta forma, os autores começam por definir o seu objeto de estudo. Ainda que reconheçam que o populismo pode existir tanto enquanto ideologia como enquanto estratégia política, o seu interesse recai sobre a primeira. Assim, baseando-se no trabalho de Mudde (2004), identificam quatro características centrais do populismo enquanto ideologia: a crença na existência de dois grupos homogéneos — o “povo” e a “elite”; a relação antagónica entre eles; o foco na ideia de soberania popular; e uma lógica maniqueísta que valoriza positivamente o povo, ao mesmo tempo que deprecia a elite. No entanto, este núcleo central do populismo é algo “fino”, no sentido de ser incapaz de dar resposta a um conjunto alargado de questões políticas, o que faz com que muitas vezes seja combinado com ideologias mais “espessas”, como sejam o conservadorismo, à direita, ou o socialismo, à esquerda. Os autores referem-se também ao facto de o populismo ter uma visão bastante antiliberal da democracia, pese embora o seu foco na soberania popular. Tal acontece por três motivos: por o seu foco no governo popular, entendido de forma literal, levar a uma negação dos checks and balances que são centrais na conceção de democracia liberal; pela sua hostilidade a

The Performance Cost of Shadow Stacks and Stack Canaries

Abstract: Control flow defenses against ROP either use strict, expensive, but strong protection against redirected RET instructions with shadow stacks, or much faster but weaker protections without. In this work we study the inherent overheads of shadow stack schemes. We find that the overhead is roughly 10% for a traditional shadow stack. We then design a new scheme, the parallel shadow stack, and show that its performance cost is significantly less: 3.5%. Our measurements suggest it will not be easy to improve performance on current x86 processors further, due to inherent costs associated with RET and memory load/store instructions. We conclude with a discussion of the design decisions in our shadow stack instrumentation, and possible lighter-weight alternatives.

Size and development of the shadow economy of 31 european and 5 other oecd countries from 2003 to 2014: different developments?

Abstract: In the Tables 1 to 3 the size and development of 31 European and of five non-European shadow economies over the period 2003-2015 is presented 1 . If we first consider the results of the average size of the shadow economy of the 28 European Union countries, we realize that the shadow economy in the year 2003 was 22.6% (of official GDP), decreased to 19.6% in 2008 and increased to 20.1% in 2009 and then decreased again to 18.3% in 2015 2 . With respect to a decrease or increase in 2015, the development of the shadow economy in the individual countries will not be uniform. In most countries (21 out of 28) the shadow economy will further decrease but in the remaining 6 countries it will increase and in 1 country it will stay the same. The 21 EU-countries where the shadow economy will further decrease are Bulgaria, Croatia, the Czech Republic, Denmark, Estonia, Finland, Greece, Ireland, Italy, Latvia, Lithuania, the Netherlands, Poland, Portugal, Romania, Slovenia, South-Cyprus, Spain, Slovakia, Sweden and the United Kingdom, whereas the shadow economy will increase in Austria, Belgium, France, Hungary, Luxembourg and Malta, and in Germany it will stay the same. The strongest increase will take place in France from 10.8% of official GDP (2014) to 12.3% in 2015; the strongest decrease will be in Lithuania from 27.1% (2014) to 25.8% in 2015.

Territorial Autonomy in the Shadow of Conflict: Too Little, Too Late? (vol 109, pg 354, 2015)

Abstract: This article evaluates the effect of territorial autonomy on the outbreak of internal conflict by analyzing ethnic groups around the world since WWII. Shedding new light on an ongoing debate, we argue that the critics have overstated the case against autonomy policies. Our evidence indicates that decentralization has a significant conflict-preventing effect where there is no prior conflict history. In postconflict settings, however, granting autonomy can still be helpful in combination with central power sharing arrangements. Yet, on its own, postconflict autonomy concessions may be too little, too late. Accounting for endogeneity, we also instrument for autonomy in postcolonial states by exploiting that French, as opposed to British, colonial rule rarely relied on decentralized governance. This identification strategy suggests that naïve analysis tends to underestimate the pacifying influence of decentralization.

Clothing Poverty: The Hidden World of Fast Fashion and Second-Hand Clothes

Abstract: * Introduction * 1. A biography of jeans * 2. Clothes and capital * 3. The shadow world of used clothing * 4. Cotton is the mother of poverty * 5. Made in China and Africa * 6. Second-hand Africa * 7. Persistent poverty * 8. Old clothes and new looks * 9. Ethical clothing myths and realities * 10. Fast-fashion systems

Do Contractionary Monetary Policy Shocks Expand Shadow Banking

Abstract: Using vector autoregressive models with either constant or time-varying parameters and stochastic volatility for the United States, we find that a contractionary monetary policy shock has a persistent negative impact on the asset growth of commercial banks, but increases the asset growth of shadow banks and securitisation activity. To explain this ‘waterbed’ effect, we propose a standard New Keynesian model featuring both commercial and shadow banking, and we show that the model comes close to explaining the empirical results. Our findings cast doubt on the idea that monetary policy can usefully ‘get in all the cracks’ of the financial sector in a uniform way.

Competitive Advantages of Shadow Banking Industry: An Analysis Using Porter Diamond Model

Abstract: This paper tries to find out why shadow banking system has become so competitive in the global financial system and how it can be controlled. For this reason we use Porter’s diamond model to find the competitive advantages of shadow banking. Based on the results of this study it can be concluded that factor conditions, chance and government do not contribute to the competitiveness of shadow banking industry. On the other hand the results suggested that related and supporting industries, firm strategy, structure and rivalry, and demand conditions contribute to the competitiveness of shadow banking industry. It is important to regulate the activities of shadow banking industry in order to prevent this industry from creating systemic risk.

The role of shadow banking entities in the financial crisis: a disaggregated view

Abstract: This article examines the role of the shadow banking system in the global financial crisis of 2007–9. In order to do this, one must first explain the reasons for the explosive growth of shadow banking in the immediate pre-crisis era. Current explanations for this growth tend to hold two contrasting positions: one emphasising factors endogenous to the banking sector (notably regulatory arbitrage and financial innovation); the other emphasising exogenous factors (notably the ‘search for yield’). Integrating these two explanations, in this article we develop a disaggregated view of the shadow banking system. After clarifying the nature of the relation between the regulated and shadow banking systems, we inquire more closely into the different entities that inhabit the shadow banking system, the different activities that these entities performed and the different financial products that these entities supplied. The disaggregated view of shadow banking suggests that while some parts of the system playe...

Confronting the Shadow Economy: Evaluating Tax Compliance and Behaviour Policies

Abstract: Contents: 1. Introduction Part I Extent and nature of the shadow economy 2. The variable magnitude of the shadow economy 3. The variable character of the shadow economy Part II Policy approaches 4. Evaluating the policy options 5. A typology of policy measures Part III Direct controls 6. Deterrence measures 7. Supply-side incentives for businesses 8. Supply-side incentives for individuals 9. Demand-side incentives Part IV Indirect controls 10. Commitment measures 11. Broader economic and social policies 12. Conclusions References Index

Shadow education: private supplementary tutoring and its implications for policy makers in Asia

Abstract: The concept of shadow education may be unfamiliar, but should hold no terrors. This is a review of a book about private tuition. The book has been co-published by the Asian Development Bank and the...

School Socioeconomic Compositional Effect on Shadow Education Participation: Evidence from Japan.

Abstract: While shadow education, organized learning activities outside formal school, has grown greatly around the world, the relationship between formal schooling and shadow education has not been well investigated. This study is therefore intended to empirically test whether formal education’s structure (i.e. tracking) affects students’ shadow education participation by utilizing a nationally representative dataset consisting of 10th-grade students in Japan. Results of multilevel logistic regression analyses show school socioeconomic compositional and cross-level interaction effects on shadow education participation: students in high-socioeconomic status (SES) schools are more likely to seek shadow education lessons than those in schools of lower SES; and higher SES students tend to take shadow education lessons, especially when in high-SES schools. Additionally, the study finds that the school composition effect becomes relatively weak when extra lessons are free of charge, highlighting the importance of family...

A Crisis of the Overcrowded Future: Shadow Banking and the Political Economy of Financial Innovation

Abstract: This article focuses on the role the shadow banking system played in the financial crisis of 2007–9. Engaging with emergent theories of shadow banking, I inquire into its structural role in contemporary capitalism. My main premise here is that the crisis of 2007–9 is distinct in financial history because it did not centre on any organised market. Rather, it was crisis of the overcrowded financial channels bridging the present and the future, which have become congested because of the massive concentration of financial values generated, yet not sustained, through the shadow banking network. My analysis suggests that shadow banking has determined the nature of financial crisis of 2007–9 and continues to play a necessary role in financial capitalism based on futurity. Drawing on scholarship in financial Keynesianism, contemporary legal studies and early evolutionary political economy, I argue that shadow banking is best seen as the organic institutional infrastructure of financialised capitalism based on deb...

Keeping both corruption and the shadow economy in check: the role of decentralization

Abstract: This paper puts forward a framework for evaluating the effects of governmental decentralization on the shadow economy and corruption. The theoretical analysis demonstrates that decentralization exerts both a direct and an indirect impact on the shadow economy and corruption. First, decentralization helps to mitigate government-induced distortions, thus limiting the extent of corruption and the informal sector in a direct way. Second, in more decentralized systems, individuals have the option to avoid corruption by moving to other jurisdictions, rather than going underground. This limits the impact of corruption on the shadow economy and implies that decentralization is also beneficial in an indirect way. As a result, our analysis documents a positive relationship between corruption and the shadow economy; however, this link proves to be lower in decentralized countries. To test these predictions, we developed an empirical analysis based on a cross-country database of 145 countries that includes different indexes of decentralization, corruption and shadow economy. The empirical evidence is consistent with the theory.

Explaining and tackling the shadow economy in Estonia, Latvia and Lithuania: a tax morale approach

Abstract: To explain the shadow economy in the Baltic states of Estonia, Lithuania and Latvia, this paper evaluates the relationship between the shadow economy and tax morale. Viewing tax morale as a measure of the symmetry between the codified laws and regulations of formal institutions (state morality) and the unwritten socially shared rules of informal institutions (civic morality), the proposition is that the lower the tax morale (i.e. the greater the asymmetry between state morality and civic morality), the greater is the likelihood to participate in the shadow economy. To evaluate this, a 2013 survey is reported involving 3036 face-to-face interviews in these 3 Baltic nations. Using logistic regression analysis, the finding is that the likelihood of participating in the shadow economy is greater, the lower is the tax morality of individuals, population groups and countries. In addition, the likelihood to participate is shadow economy is found to significantly vary by, for example, gender, employment status an...

The Decision for Shadow Education in Japan: Students' Choice or Parents' Pressure?

Abstract: Following decision theory (Boudon, Raymond. 1974. Education, Opportunity, and Social Inequality: Changing Prospects in Western Society. New York: Wiley.), social origin strongly affects educational decisions, especially at transition points in educational attainment. In Japan, the fierce competition in gaining access to the next level of schooling intensifies the impact of educational decisions on students' future careers. In addition to selecting a certain school, families are forced to decide whether or not to invest in shadow education. Thus far, socioeconomic background and parents' educational aspirations, in conjunction with students' academic achievement, have been deemed influential to such decisions in Japan. The agency of the student is rarely even considered. Based on calculations from the 2011 Hyogo High School Students' (HHSS) survey, the theoretical approach presented in this article stresses the importance of acknowledging the existence of a multitude of actors involved in each phase of the decision-making process, including the students themselves, especially when explaining inequalities in modern societies.

Shadow bureaucracies and the unilateral control of international secretariats: Insights from UN peacekeeping

Abstract: While formal decision power in most international organizations rests with the member states, the member states often delegate the preparation of decisions to international secretariats. To prepare decisions, secretariats gather and analyze information and subsequently provide the member states with an assessment on the alternative courses of action. In this process, secretariats may accumulate an information surplus over the member states. They can use this advantage to suggest options close to their own interests. This article argues that, to counter such agency problem, the member states unilaterally invest in shadow bureaucracies with the aim to reduce informational asymmetries. Shadow bureaucracies are, however, costly. Member states have to weigh agency costs against the costs of domestic administrative capability. Strong states with outlier preferences are most likely to invest in shadow bureaucracies. They have most to gain. The use of shadow bureaucracies not only reduces agency costs. It also allows states more control over policy in international organizations. This article uses insights from peacekeeping in the United Nations to illustrate the argument.

Alienation, Discrimination, and Securitization: Legal Personhood and Cultural Personhood of Muslims in Myanmar

Abstract: Since 2010 Myanmar has undergone a series of significant political and social reforms initiated by the U Thein Sein administration. Largely unexpected under the shadow of the notoriously repressive...

Understanding Policy Rates at the Zero Lower Bound: Insights from a Bayesian Shadow Rate Model

Abstract: Term structure models are routinely used by central banks to assess the impact of their communication on market participants' views of future interest rate developments. However, recent studies have pointed out that traditional term structure models can provide misleading indications when policy rates are at the zero lower bound (ZLB). One of the main drawbacks is that they are unable to reproduce the stylized fact that policy rates tend to remain at the ZLB for prolonged periods of time once they reach it. A consensus has recently emerged that shadow rate models, first introduced by Black (1995), are apt to solve this problem. The main idea is that the shadow rate (i.e., the short-term interest rate that would prevail in the absence of the ZLB) can move in negative territory for long time spans even when the actual rate remains close to the ZLB. Due to their high nonlinearity, shadow rate models are particularly difficult to estimate and have been so far only estimated with approximate methods. We propose an exact Bayesian method for their estimation. We use it to study developments in euro and US dollar yield curves since the end of the '90s. Our estimates confirm -- and provide a quantitative assessment of -- the fact that there has been a significant divergence of monetary policies in the euro area and in the US over the past years: between 2009 and 2013, the shadow rate was much lower in the US than in the euro area, while the opposite has been true since 2014; furthermore, at the end of our sample (January 2015), the most likely date of the the first increase in policy rates was estimated to be around mid-2015 in the US and around 2020 in the euro area.