Default Compensation Research Articles

Blockchain Technology Adoption by Critical Stakeholders in Prefabricated Construction Supply Chain Based on Evolutionary Game and System Dynamics

Blockchain technology (BT) is a promising solution to address information asymmetry and trust issues in the prefabricated construction supply chain (PCSC). However, its practical application in PCSC remains limited under the influence of stakeholders’ adoption strategies. While previous studies have analyzed drivers and barriers to BT adoption, they often take a static view, neglecting the long-term dynamic decision-making interactions between stakeholders. This study addresses this gap by examining the interests of owners, general contractors, and subcontractors, and by developing a tripartite evolutionary game model to analyze the interaction mechanism of the strategy of adopting BT in PCSC. Additionally, a system dynamics simulation validates the evolution of stabilization strategies and examines the impact of key parameters. The results indicate that successful BT adoption requires technology maturity to surpass a threshold between 0.5 and 0.7, along with a fair revenue and cost-sharing coefficient between general contractors and subcontractors, ranging from 0.3 to 0.5 at the lower limit and 0.7 to 0.9 at the upper limit. Notably, general contractors play a pivotal role in driving BT adoption, acting as potential leaders. Furthermore, appropriate incentives, default compensation, and government subsidies can promote optimal adoption strategies, although overly high incentives may reduce owners’ willingness to mandate BT adoption. This study provides practical insights and policy recommendations for critical stakeholders to facilitate the widespread adoption of BT in PCSC.

Characterization and correction of center-frequency effects in X-nuclear eddy current compensations on a clinical MR system.

PurposeThe aim of the study was to investigate whether incorrectly compensated eddy currents are the source of persistent X‐nuclear spectroscopy and imaging artifacts, as well as methods to correct this.MethodsPulse‐acquire spectra were collected for 1H and X‐nuclei (23Na or 31P) using the minimum TR permitted on a 3T clinical MRI system. Data were collected in 3 orientations (axial, sagittal, and coronal) with the spoiler gradient at the end of the TR applied along the slice direction for each. Modifications to system calibration files to tailor eddy current compensation for each X‐nucleus were developed and applied, and data were compared with and without these corrections for: slice‐selective MRS (for 23Na and 31P), 2D spiral trajectories (for 13C), and 3D cones trajectories (for 23Na).ResultsLine‐shape distortions characteristic of eddy currents were demonstrated for X‐nuclei, which were not seen for 1H. The severity of these correlated with the amplitude of the eddy current frequency compensation term applied by the system along the axis of the applied spoiler gradient. A proposed correction to eddy current compensation, taking account of the gyromagnetic ratio, was shown to dramatically reduce these distortions. The same correction was also shown to improve data quality of non‐Cartesian imaging (2D spiral and 3D cones trajectories).ConclusionA simple adaptation of the default compensation for eddy currents was shown to eliminate a range of artifacts detected on X‐nuclear spectroscopy and imaging.

Discounting Damage: Non-Linear Discounting and Default Compensation - Valuation of Non-Replicable Value and Damage

In this short note we develop a model for discounting. A focus of the model is the discounting, when discount factors cannot be derived from market products. That is, a risk-neutralizing trading strategy cannot be performed. This is the case, when one is in need of a risk-free (default-free) discounting, but default protection on funding providers is not traded. For this case, we introduce a default compensation factor (exp(+~λT)) that describes the present value of a strategy to compensate for default (like buying default protection would do). In a second part, we introduce a model, where the survival probability depends on the required notional. This model is different from the classical modelling of a time-dependent survival probability (exp(-λT)). The model especially allows that large liquidity requirements are instantly more likely do default than small ones. Combined the two approaches build a framework in which discounting (valuation) is non-linear. The non-linear discounting presented here has several effects, which are relevant in various applications: *If we consider the question of default-free valuation, i.e., factoring in the cost of default protection, the framework can will lead to over-proportional higher values (or cost) for large projects (or damages). The framework can lead to the effect that discount-factors for very large liquidity requirements or projects are an increasing function of time. It may even lead to discount factors larger than one. This may have relevance in the assessment of event like climate change. * For the valuation of defaultable products, e.g., like a defaultable swap, the framework leads to the generation of a continuum of (defaultable) par rate curves (interest rate curve) and the valuation of a payer and a receiver swap differs by more than just a sign.

Game Analysis between Banks and B2B Platforms in Agricultural Electronic Order Financing

In recent years, agricultural electronic order financing has developed rapidly, and cooperation between banks and B2B platforms has become the main mode of operation. In the process of cooperation, there are moral hazards caused by information concealment. On the basis of analyzing the business characteristics and the behavior strategies of both sides, this paper discusses the cooperation mechanism between the two sides by using the game analysis method. The results show that the strategy choice of the banks and the B2B platforms is not only affected by the credit of financing customers, but also by the concealment cost and the concealment income. When the concealment cost is less than the concealment income, the profit distribution ratio and the default compensation ratio can be the key factors of affecting the strategy choice of the B2B platforms and the banks. When the concealment cost is greater than the concealment benefit, the change value of the income distribution caused by the different strategies has an important impact on the strategy choice of the banks.

Weight of the Default Component of CDS Spreads: Avoiding Procyclicality in Credit Loss Provisioning Framework

The current expected loss calculations have recently attracted considerable attention in the research on credit risk modeling, impairment provisioning, and financial networks’ stability. A new CDS‐based approach to estimate current expected credit loss is proposed for low default portfolios, containing credit exposures to corporate issuers covered by publicly traded CDS contracts. First, a fraction of CDS spread related to a pure default compensation for different CDS maturities is assessed. Our results contrast with previous research. Second, based on the obtained historical weights of the default risk premium, a forward‐looking term structure of the probabilities of default implied by the current CDS quotes is derived. The proposed approach covers both investment and noninvestment grade debt. The resulting framework is applied to a sample of corporate bonds. The developed methodology provides a useful tool, on one hand, for credit risk managers and balance‐sheet preparers and, on the other hand, for regulators of financial markets as it sheds light on how procyclicality could be avoided in provisions.

ANALISIS YURIDIS PERJANJIAN PEMBIAYAAN KONSUMEN DAN AKIBAT HUKUM JIKA TERJADI WANPRESTASI DALAM PERJANJIAN PEMBIAYAAN KONSUMEN DI INDONESIA

In Article 1329 of the Civil Code, the agreement is divided into 2 (two) kinds, namely the named agreement (nominaat) and unnamed agreement (innominaat). Contracts or agreements develope at this time as a logical consequence of the development of business cooperation between business actors. In a treaty there is one part bind itself to another part. Consumer financing is an agreement not specifically regulated in the Civil Code, but since the book III of the Civil Code embraces an open system, parties may enter into agreements not specifically regulated in the Civil Code. The consumer financing agreement as an Innominaat agreement is also subject to general terms of agreement. In this study using normative research methods, where the authors can examine and can also learn the norms contained in legislation or norms that regulated the principle of freedom of contract according to the Civil Code so that in its implementation in accordance with applicable regulations. The results show how the implementation of consumer financing agreements in Indonesia and how the legal consequences in case of default in consumer financing agreements. First, basically the consumer financing agreement in Indonesia is conducted like other agreements in general. Consumer Financing Agreement is not like a sale or purchase agreement or a lease, but the consumer financing agreement is a combination of both applicable by the parties exercising the rights and obligations in the agreement as described above. Second, the result of the law in case of default, the agreement does not need to be requested for cancellation, but by itself has been null and void, but the provisions of Article 1266 paragraph 2 explain that the consequences of the law of default are not null and void, but must be annulled to the judge. Subsequently Article 1244- Article 1252 of the Criminal Code describes the compensation for default, namely, by paying the actual losses suffered, the fees used, and allowed to cease the expected loss of profits.

True Interest and the Affections: The Dangers of Lawful Lending in The Merchant of Venice

This essay reads the often overlooked distinction between interest and usury back into The Merchant of Venice, revealing the play's focus on the dangers of Christian lending practices. True interest, a lawful compensation for default, derived legitimacy from its conceptual basis in idealized Christian affections: amity, trust, and mercy. Shylock adopts this Christian model of "kind" lending in his bond with Antonio as a means for lawful revenge. In his alternative penalty of a pound of flesh, Shylock's bond gestures metonymically to the practice of imprisoning the debtor's body when interest could not be collected. Interest's legitimating affections provide a lawful conveyance and screen for the destructive passions that motivate lending in the play: Shylock's vengeance and Antonio's prodigal self-sacrifice. Portia's pragmatic revision of interest as self-love ironically counters the destructive passions lurking beneath Christian love and true interest.

Inferring Default Probabilities from Credit Spreads

Default probabilities (PDs) for risky obligors are derived from market spreads and spread volatilities. The method assumes that 1) credit spreads, on average, are linear functions of spread volatility and that 2) investors require the same spread compensation per unit of spread volatility regardless of its source. Credit spreads are decomposed into two parts: compensation for default and compensation for spread volatility. An analysis of the credit risk premium is described as a precursor to estimating default probabilities from market data. Finally, market-implied PDs are used to assess risk and relative value of global sovereign issuers of external debt.

On the determinants of yield spreads between mortgage pass-through and Treasury securities

Yield spreads between mortgage pass-through and U.S. Treasury securities may reflect differences in taxation, phenomena affecting relative supply and demand, and compensation for default, call, and marketability risks on mortgage instruments. Our research empirically models differences in yields between pass-throughs and comparable-maturity Treasuries. We find that interest-rate volatility and the term structure of rates, factors often cited in the mortgage pricing literature as affecting the mortgage call premium, are the primary determinants of movements in these spreads. Moreover, these effects have grown in importance in recent years as exercise of the prepayment option has increased. We also find evidence that liquidity and credit concerns affect the pricing of pass-through securities.