Equity Lines Research Articles

Transformation Tensions in Higher Education: Equity, Efficiency, and Development

Nico Cloete and Teboho Moja Transformation Tensions in Higher Education: Equity, Efficiency, and Development H IG H ER EDUCATION IN SOUTH AFRICA SIN CE 1994 IS braided into the bargain struck by President F. W. De Klerk and prisoner Nelson Mandela—both in terms of the baggage it carried and the promises it offered. When the new government came to power in 1994 on the basis of the “implicit bargain” (Gelb, 2001) reached between the National Party and the liberation movement led by the African National Congress (ANC), there was consensus in the government of national unity that higher education needed transformation. Not as clear was the nature of the tensions implicit in the compromises that had to be made and how the trade-offs would be negotiated. In the course of 2004 many reviews of the first decade of South African democracy were published. They can be classified into two main categories: self-congratulatory eulogies reluctantly conceding a few “challenges” that need to be addressed in the next decade, and condemnatory critiques of the new government’s readiness to sell out to Washington-led neoliberal globalization in order to promote nonracial class formation. In an attempt to avoid such position taking, this review aims to show that a combination of the politics of macro social and economic processes and historical legacies in higher education led to the emergence of a number of “transformation tensions.” In social research Vol 72 : No 3 : Fall 2005 693 this paper we identify some of these tensions and argue that problems have arisen because the tensions were not anticipated during the initial policy-making process. Two related sets of tensions in the higher education sector are identified and discussed later. The transformation of higher education and the policy decisions taken to effect it fall predominantly within the tension lines of equity and development, and equity and efficiency. These are not the only tensions; there are other veiy important pres­ sures such as the tension between leadership (steering from the top) versus participation, but these will not be the subject of this article. The tensions discussed do not imply a choice between the good and the bad because all the tension points are important. The real challenge is to prioritize and pay attention to what seems most urgent while not ignoring the other end of the tension line. EQUITY VERSUS DEVELOPMENT There was strong anticipation in South Africa, as there was in the sixties and seventies in many newly independent African countries, that higher education would contribute to social and economic devel­ opment. At the infamous Accra workshop of 1973, the Association of African Universities declared that “the university in Africa occupies too critical a position to be left alone to determine its own priorities and should therefore accept the hegemony of government” (Yesufu, 1973: 45). In many countries in Africa this line of argument was used to violate academic freedom and justify political interference, and not to provide a development agenda (Moja, Muller, and Cloete, 1996). In South Africa, the stoiy has thus far been rather different, but not unlike other countries in Africa, the government is struggling to construct a socioeconomic framework that provides appropriate signals for higher education. From the first attempts to start formulating a new policy frame­ work for postapartheid South Africa (the 1992 National Education Policy Initiative), the possibility of tension between equity and development was present in policy debate. Badat, Barends, and Wolpe (1994) reasoned 694 social research that higher education would be confronted with sets of contradictions, and that the most problematic would be the tension between equity and development. For example, it was argued that a transformed, expanded, and democratized higher education system could become more equitable in terms of access for large numbers of black students registered in cheap courses, such as the then popular biblical studies and language majors. But it was also foreseen that two problems could possibly emerge out of such a system. The first was a growth in enroll­ ment figures and a massive increase in student-to-faculty ratios with the likelihood of a drastic reduction in quality. The second problem was that the choice of cheap courses would not...

Washington Trust Bancorp, Inc.

AbstractCommercial Banking (MIC: 8.1 SIC: 6022 NAIC: 522110)Washington Trust Bancorp is a bank holding company, operating through its wholly owned subsidiary, The Washington Trust Company (the Bank). The Bank's market area includes Washington County and portions of Providence and Kent Counties in Rhode Island, as well as a part of New London County in Connecticut. The Bank provides a range of financial services, including: residential mortgages, commercial loans, commercial and consumer demand deposits, construction loans, consumer installment loans, home equity lines of credit, retirement accounts, merchant credit card services, cash management services, and trust and investment management services. At Dec 31 2004, Co. had assets of $2.31 billion.

First Oak Brook Bancshares, Inc.

AbstractCommercial Banking (MIC: 8.1 SIC: 6022 NAIC: 522110)First Oak Brook Bancshares is a holding company. Through its Oak Brook Bank (the Bank) subsidiary, Co. provides general retail and commercial banking, primarily in the Chicago Metropolitan area. The services offered include demand, savings and time deposits, corporate treasury management services, merchant credit card processing, commercial lending products such as commercial loans, construction loans, mortgages and letters of credit, and personal lending products such as residential mortgages, home equity lines and vehicle loans. The Bank operates an investment management and trust department as well as an investment sales division. At Dec 31 2004, Co. had total assets of $2.08 billion.

Irwin Financial Corp. (Columbus, IN)

AbstractCommercial Banking (MIC: 8.1 SIC: 022 NAIC: 22110)Irwin Financial is a diversified financial services engaged in mortgage banking, commercial banking, home equity lending, commercial finance, and venture capital. The mortgage banking business originates, purchases, sells, and services residential mortgage loans. The commercial banking business provides credit, cash management and personal banking products primarily to small businesses and business owners. Irwin Home Equity originates, purchases, securitizes and services home equity loans and lines of credit. Co.'s commercial finance business originates small‐ticket equipment leases. Irwin Ventures invests in early stage companies in the financial services industry.

First Oak Brook Bancshares, Inc.

AbstractCommercial Banking (MIC: 8.1 SIC: 022 NAIC: 22110)First Oak Brook Bancshares is a holding company. Through its Oak Brook Bank (the Bank) subsidiary, Co. provides general retail and commercial banking, primarily in the Chicago Metropolitan area. The services offered include demand, savings and time deposits, corporate treasury management services, merchant credit card processing, commercial lending products such as commercial loans, construction loans, mortgages and letters of credit, and personal lending products such as residential mortgages, home equity lines and vehicle loans. The Bank operates an investment management and trust department as well as an investment sales division. At Dec 31 2004, Co. had total assets of $2.08 billion.

Citibank Models Credit Risk on Hybrid Mortgage Loans in Taiwan

A new type of hybrid loan in Taiwan consists of a traditional residential mortgage with an attached line of credit. Motivated by declines in Taiwanese property values and unexpected credit losses on all types of loans secured by residential real estate, we developed new statistical models for analyzing the credit risk on traditional mortgages, the hybrid loans, and pure equity lines of credit. Nonstationary Markovian models represent probabilities of transition among different financial states for the three credit instruments. We used logistic and regression models to estimate the losses on defaulted loans and the utilization of credit lines. We calibrated the models with account-level data and integrated them into comprehensive forecasting models that revealed differences in risk profiles among the three types of credit and among different segments of each portfolio.

Park National Corp. (Newark, OH)

AbstractCommercial Banking (MIC: 8.1 SIC: 6021 NAIC:522110)Park National is a bank holding company with $5.03 billion in total assets at Dec 31 2003. Through its subsidiaries, Co. engages in general commercial banking and trust business in small and medium population Ohio communities. Co.'s subsidiaries provide the following services: the acceptance and servicing of demand, savings and time deposit accounts; commercial, industrial, consumer and real estate lending, including installment loans, credit cards, home equity lines of credit and commercial and auto leasing; trust services; cash management; safe deposit operations; electronic funds transfers; and online Internet banking with bill pay service.

Washington Trust Bancorp, Inc.

Mergent's Dividend AchieversVolume 2, Issue 2 p. 300-300 U.S. Company Report Washington Trust Bancorp, Inc.† First published: 22 April 2005 https://doi.org/10.1002/div.2471 † Contact: : John C. Warren — Chmn., C.E.O. Address: : 23 Broad Street, Westerly, RI 02891 Web Site: : www.washtrust.com AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinkedInRedditWechat Abstract Commercial Banking (MIC: 8.1 SIC: 022 NAIC: 22110) Washington Trust Bancorp is a bank holding company. Through its subsidiaries, Co. operates banking and other financial services and businesses. Co. provides a broad range of financial services, including: residential mortgages, commercial loans, construction loans, consumer installment loans, home equity lines of credit, merchant credit card services, automated teller machines, telephone banking services, Internet banking services, commercial deposits, consumer demand deposits, savings deposits, negotiable order of withdrawal and money market deposits, certificates of deposit, retirement accounts, cash management services, safe deposit boxes, and trust and investment management services. Volume2, Issue2Spring 2005Pages 300-300 RelatedInformation

An Empirical Analysis of Home Equity Loan and Line Performance

Given the growth in home equity lending during the 1990s, it is imperative that lenders and regulators understand the risks associated with this segment of the residential mortgage market. This paper addresses this need through analysis of a unique panel data set of over 135,000 homeowners with second mortgages. Our analysis indicates that significant differences exist in the prepayment and default probabilities of home equity loans and lines. We find that households with equity loans are relatively more sensitive to changes in interest rates. On the other hand, households with equity lines are more sensitive to appreciation in property value. Our analysis offers insights into bank minimum capital requirements associated with home equity credit lending.

Park National Corp.

AbstractCommercial Banking (MIC: 8.1 SIC: 6021 NAIC:522110)Park National is a bank holding company with $5.03 billion in total assets at Dec 31 2003. Through its subsidiaries, Co. engages in general commercial banking and trust business in small and medium population Ohio communities. Co.'s subsidiaries provide the following services: the acceptance and servicing of demand, savings and time deposit accounts; commercial, industrial, consumer and real estate lending, including installment loans, credit cards, home equity lines of credit and commercial and auto leasing; trust services; cash management; safe deposit operations; electronic funds transfers; and online Internet banking with bill pay service.

Cancer vaccine THERATOPE- Biomira.

Cancer vaccine THERATOPE- Biomira.

Household Debt and the Tax Reform Act of 1986

Prior to the Tax Reform Act of 1986 (TRA 86), interest paid on all types of household debt was deductible from income before the payment of taxes. In 1986, Congress changed the law to phase out the deductibility of interest over a five-year period.' Congress believed deductibility of interest an incentive to invest in durables rather than assets which produce taxable income and, therefore, an incentive to consume rather than save.... By phasing out the present deductibility of personal Congress intended to eliminate from the prior tax law a significant disincentive to (Joint Committee on Taxation [JCT], 1987 p. 263). The other goal of the provision was to raise $9.6 billion per year in tax revenue by 1991. Because Congress determined that encouraging home ownership is an important policy goal, achieved in part by providing a deduction for residential mortgage interest, it chose to retain the residential mortgage interest deduction (JCT, 1987 pp. 263-64). Thus, mortgage interest was fully deductible for interest paid on debt secured by a taxpayer's first or second residence up to his basis in the residence. The Omnibus Budget Reconciliation Act of 1987 (OBRA 87) changed the law so that interest paid was fully deductible on up to $1 million in acquisition debt and $100,000 in home equity debt.2 Debt is categorized as acquisition debt if it is used for the purchase or improvement of a home; home equity debt includes all other debt secured by a home. By keeping the mortgage interest deduction, Congress may have provided a loophole that some taxpayers could exploit. There was no restriction on the use of home equity debt, and taxpayers who owned homes could borrow against their home equity to pay for the same purchases they had previously funded with loans. Homeowners were given an incentive to shuffle their portfolios away from debt into mortgage debt. The widespread introduction of home equity lines of credit in the mid-1980's, which may have been spurred in part by the change in tax law, provided an inexpensive and flexible method for households to make this shift.3 Measuring the extent of portfolio shuffling is important for understanding whether households view mortgage and debt as close substitutes. Clearly the substitution of mortgage debt for debt undermines the goals of Congress to boost saving and increase revenue. Moreover, homeowners already have substantial tax preferences through the lack of taxes on the imputed income from housing and the preferential tax treatment of capital gains on their principal residence. The ability to use deductible mortgage debt to finance purchases provides homeowners another tax advantage relative to renters. Figure 1 plots the percentage change in * Putnam Investments, One Post Office Square, Bos on, MA 02109 (e-mail: dean_maki@putnaminv.com). This paper was completed while I was on the staff of the Board of Governors of the Federal Reserve System. Financial support from the Stanford Institute for Economic Policy Research and the Lynde and Harry Bradley Foundation is gratefully acknowledged. I would like to thank John Shoven, Orazio Attanasio, John Pencavel, Tim Bresnahan, Anne Royalty, Doug Bernheim, Al Teplin, Craig Furfine, Martha StarrMcCluer, Raphael Bostic, Len Burman, Julia Coronado, two anonymous referees, seminar participants, and the Financial Institutions Research Review Group for helpful comments. The views expressed in this paper are those of the author and do not necessarily reflect the views of Putnam Investments or the Federal Reserve Board or its staff. 1 In this paper, consumer interest refers to interest paid on loans that are not secured by a residence. 2 Under TRA 86, interest paid on qualified educational and medical debt secured by a home was also deductible, even if this debt exceeded the household's basis. This provision was not renewed in OBRA 87. Under OBRA 87, home equity debt also could not exceed the difference between the fair market value of the home and the amount of acquisition debt, even if this difference was less than $100,000. 3 Of course, homeowners can also increase their mortgage debt by taking out a traditional home equity loan, by taking cash out when refinancing their mortgage, or by taking out a larger mortgage when they Durchase a home.

Brand Equity and Vertical Product Line Extent

This paper addresses the question of how the vertical structure of a product line relates to brand equity. Does the presence of “premium” or high-quality products in a product line enhance brand equity? Conversely, does the presence of “economy” or low-quality products in a product line diminish brand equity? Economists and marketing researchers refer to variation in quality levels of products within a category as “vertical” differentiation, whereas variation in the function or “category” of the products is referred to as “horizontal” differentiation. Much of the existing research on the relationship between product line structure and brand equity has focused on the horizontal structure of the product line and has been primarily concerned with brand extensions—what happens when the product line of a brand is extended horizontally into new categories? Researchers have been concerned primarily with how the extension fares, but the effect of the extension on the core products is also important. There is an analogous question of what happens when the product line of a brand is extended vertically, either “up market” or “down market.” This question of vertical extensions is part of the more general issue of how the vertical structure of a product line relates to brand equity. The specific research questions addressed in this paper are: (1) do “premium” or high-quality products enhance the brand equity associated with the other products in the line? (2) Conversely, do “economy” or low-quality products diminish the brand equity associated with the other products in the line? These research questions are relevant to three managerial issues in product-line strategy. First, what are the costs and benefits of including “down market” products within a brand? Second, what are the implications of including high-end models within a brand? Third, when should high-end and low-end products be offered under an existing brand umbrella and when should these products be offered under separate brands? We address these research questions empirically through an analysis of the models and brands within the U.S. mountain bicycle industry. We use price premium above that which can be explained by the physical characteristics of the bicycle as a metric for brand equity. We then test several hypotheses related to the relationship between extension of the product line upward and downward and the price premium commanded by the brand. We further support this analysis with a simple laboratory experiment. The analysis reveals that price premium, in the lower quality segments of the market, is significantly positively correlated with the quality of the lowest-quality model in the brand's product line; and, that for the upper quality segments of the market, price premium is also significantly positively correlated with the quality of the highest-quality model in the brand's product line. The results of the analysis are supported by the outcome of an experiment in which 63 percent of the subjects preferred a product offered by a high-end brand to the equivalent product offered by a low-end competitor. These results imply that managers wishing only to maximize the equity of their brands would offer only high-quality products and avoid offering low-quality products. However, this result must be moderated by the overall objective of maximizing profits. Maximizing profits is likely to involve a tradeoff between preserving high brand equity (and therefore high margins) and pursuing the volume typically located in the lower end of the market. One of the most significant implications of this research is that product line managers need to be mindful not just of the incremental cannibalization or stimulation of sales of products that are immediate neighbors of an extension to the product line, but also the effect of such an extension on the brand equity in other, possibly quite different, parts of the product line.

Determinants of the Demand for Home Equity Credit Lines

From the Survey of Consumer Finances conducted in 1989 and 1992 a logit model was tested for demographic and financial influences on household decisions to utilize home equity line credit. Results indicate that among households with credit lines other than credit card lines or business lines, the choice of a home equity credit line in lieu of another type of check credit line is influenced principally by percentage of equity in the home, income, net worth, age of the borrower, and credit price. Several implications may be derived from this study. As the markets reflect more complete information about the low‐risk attributes of this credit, the convenience as a payment mechanism, and the tax subsidy to homeowners, it is expected that home equity credit lines users will be distributed more evenly across income and wealth categories.

Deregulation, tax reform, and the use of consumer credit

This article analyzes the probable effects of recent deregulation of consumer credit markets and tax reform on household credit-use decisions. The results of the analysis suggest that deregulation of rates of charge for consumer credit contracts accounts for a substantial portion of the increase in consumer credit outstanding relative to household income since 1982. The effect would not originate from the extention of credit in newly deregulated markets to households that had not been able to get credit before (widening of credit use). Rather, it would come from the provision of greater amounts of credit to borrowers in general (deepening of credit use). With regard to tax reform, the probability of debt use is significantly higher for those households most likely to itemize deductions for federal income tax purposes. Holding the level of interest rates constant, tax reform that removes the deductibility of consumer interest is not expected to affect the amount of credit used relative to income but is expected to have a significant effect on the type of debt used by such households. They will likely be early adopters of home equity lines of credit. Their shift from consumer to mortage credit is expected to have a long-term negative effect on the credit quality of consumer credit portfolios.