Credit Issues Research Articles

Issues of partial credit in mathematical assessment by computer

The CALM Project for Computer Aided Learning in Mathematics started at Heriot-Watt University in 1985. hi the first phase of the project CAL materials were created in calculus with each topic structured around Theory, Worked Examples, Motivating Examples and a Test. Students chose most readily to work through the Test section questions, welcoming the chance to assess their own progress. In addition, the teachers could view class progress. The weekly tests were designed from banks of questions with randomized parameters in each question. These questions prompted students for a mathematical answer and asked them to type in the response on one line using a style similar to computer languages such as Pascal. Students of engineering and science took only a short time to adjust to this approach. The routines developed in those early stages of CALM meant that testing could be more meaningful and did not rely on the more usual multiple-choice format favoured by so many computer projects. Over the years 1989-1992 CALM developed techniques to trap predictable wrong answers and this form of self-testing proved to be a powerful learning aid for students. Nevertheless, some problems which are discussed in greater detail in later sections remained.DOI:10.1080/0968776990070105

ARE WATCH PROCEDURES A CRITICAL INFORMATIONAL EVENT IN THE CREDIT RATINGS PROCESS? AN EMPIRICAL INVESTIGATION

The Boot, Milbourn, and Schmeits (2006) model (Boot model) predicts certain credit rating events are likely to be more informative than others and that creditwatch procedures are an important driver of such differences. We test the core empirical predictions of their model. Our sample comprises U.S. corporate issuer credit ratings provided by Moody’s, 1990–2006. Our findings fail to uncover compelling evidence for the empirical predictions of the Boot model in relation to the role of watch procedures as coordinating mechanisms. Rather, our findings are more supportive of the view that rating agencies are always at an informational advantage relative to investors.

Trends and composition of institutional credit to the agriculture sector during the post-reform period in India

This paper attempts to analyse the changes in trends and composition of multi-agency network (Co-operatives, SCBs, and RRBs) in issuance of credit to agriculture sector during the post-reform period by using time series data from 1975 to 2005. The analysis reveals that the trends of direct (short and long-term) and indirect institutional credit to agriculture sector has increased significantly during the post-reform period. As far as the composition is concerned, the share of SCBs as percentage of total direct institutional credit has increased significantly whereas the co-operatives share has decreased. The regional rural banks contribution has been almost constant. We have also tried to find out the distribution of indirect finance through Scheduled Commercial Banks.

The 7 Cs of rural credit in China

PurposeThe purpose of this paper is to provide an overview of the farm and rural credit system in China. To do this the authors use the so‐called “7 Cs” of credit (these include: Credit, Character, Capacity, Capital, Condition, Capability, and Collateral) and for each “C” provide some aspect of importance related to agricultural finance.Design/methodology/approachThis paper is largely based on a survey of 897 farm households in Shaanxi and Gansu provinces, and extensive interviews of agricultural lenders conducted in the summer and fall of 2009. These data are used in simple form and in regression form to explain a variety of credit issues in China.FindingsA number of key factors related to credit delivery and demand are found. First, using the 7 Cs as a guide proved to be very fruitful for disentangling the many institutional and cultural facets affecting rural credit in China. Under “Character” the authors discuss the cultural characteristics of the Chinese farmer in terms of informal lending and borrowing; under “Capacity” the authors discuss the challenges of delivering credit to farms with limited resources; under “Condition” the authors discuss group guarantees and credit worthy villages, credit rationing and insurance and incomplete markets; under “Capability” the authors discuss income inequality and challenges in economies of scale and size; and for “Collateral” the authors discuss the implications of lack of collateral and limitations on farm economic growth due to the collectivization of land and the potential for agricultural lending from the transferability and mortgagability of land or forestry use rights.Research limitations/implicationsAlthough the assessment provides a great deal of breadth and depth across many credit‐related issues in China, it is not an exhaustive study. Agricultural and rural credit in China is very complex and in many instance under developed. The survey results from Shaanxi and Gansu tell a story that is consistently told throughout China, but the authors would caution against using the data to characterize farm credit across China as a whole.Social implicationsLarge swaths of China have either no or very rudimentary credit services. Even in areas where credit is in supply there are issues of poverty that could be aided with credit access and delivery. In order to improve livelihoods through credit institutions, it is important to understand rural credit in many dimensions. This paper takes a step in that direction.Originality/valueDespite the importance of rural credit in China, it is largely understudied and not well understood. This paper makes progress in providing such an understanding. Our reasoning for using our unique approach is that by understanding the 7 Cs of credit one comes to understand the elemental characteristics of the credit decision from the lender's point of view but in a way that takes into account conditions at the farm level. The 7 Cs provide an objective approach to credit assessment that balances both the supply of and demand for credit.

The Days to Pay Accounts Payable Determinants - Financing, Pricing Motives and Financial Substitution Effect - A Panel Data GMM Estimation from European Western Countries

This paper proposes to elect the days to pay accounts payable determinants and our findings strongly support that the accounts payable problematic is closely related to short term financial decisions with a positive and significant influence of firm’s profitability and size factors. The existence of a firm’s negative working capital is confirmed to influence strongly the reduction of the trade credit obtained from suppliers in Western Europe countries in parallel with a joint contribution of short and long term bank financing as a substitute from trade debt. Firm characteristics related to negative working capital and fixed assets level, jointly or alone, give more importance to the innovative role of short term bank financing on substituting or reducing the volume of trade credit obtained from suppliers which contradicts prior findings. Negative working capital reinforces the role of long term bank financing. It seems to induce the presence of a corporate cost reduction strategy to preserve or increment the firm’s market reputation and competition. The firm’s return on assets implies an enlargement of the days to pay accounts payable in line with a rising creditworthiness. All innovative and interacted variables are responsible for the reduction of the days to pay accounts payable and the confirmation of the financial substitution effect introduces more financing discipline compatible with firm’s cost reduction strategy and pricing motives included in a price discrimination strategy. Signs of future unbalanced capital structure and financial distress may appear due also to the more banking financing justified by firm’s investment and negative working capital under finance motives point of view. The more firm’s growth the less trade credit obtained and, on the contrary, profitability and size contribute to facilitate the trade credit obtained from suppliers under finance and pricing motives point of view, more over the stability on terms trade credit. As important as the days to pay accounts and/or days sales outstanding determinants are future investigations related to trade credit duration gap as a synthesis of the prior trade credit issues and a starting point to evaluate internal corporate trade credit risk taking. Relevant research are also related to country and economic sector or country union analysis, as well.

Dynamic Modeling of Portfolio Credit Risk with Common Shocks

We consider a bottom-up Markovian copula model of {portfolio} credit risk where instantaneous contagion is possible in the form of simultaneous defaults. Due to the Markovian copula nature of the model, calibration of marginals and dependence parameters can be performed separately using a two-steps procedure, much like in a standard static copula set-up. In this sense this model solves the bottom-up top-down puzzle which the CDO industry had been trying to do for a long time. It can be applied to any dynamic credit issue like consistent valuation and hedging of CDSs, CDOs and counterparty risk on credit portfolios.

Evaluating the impact of water conservation on fate of outdoor water use: A study in an arid region

In this research, the impact of several water conservation policies and return flow credits on the fate of water used outdoors in an arid region is evaluated using system dynamics modeling approach. Return flow credits is a strategy where flow credits are obtained for treated wastewater returned to a water body, allowing for the withdrawal of additional water equal to the amount returned as treated wastewater. In the return credit strategy, treated wastewater becomes a resource. This strategy creates a conundrum in which conservation may lead to an apparent decrease in water supply because less wastewater is generated and returned to water body. The water system of the arid Las Vegas Valley in Nevada, USA is used as basis for the dynamic model. The model explores various conservation scenarios to attain the daily per capita demand target of 752 l by 2035: (i) status quo situation where conservation is not implemented, (ii) conserving water only on the outdoor side, (iii) conserving water 67% outdoor and 33% indoor, (iv) conserving equal water both in the indoor and outdoor use (v) conserving water only on the indoor side. The model is validated on data from 1993 to 2008 and future simulations are carried out up to 2035. The results show that a substantial portion of the water used outdoor either evapotranspires (ET) or infiltrates to shallow groundwater (SGW). Sensitivity analysis indicated that seepage to groundwater is more susceptible to ET compared to any other variable. The all outdoor conservation scenario resulted in the highest return flow credits and the least ET and SGW. A major contribution of this paper is in addressing the water management issues that arise when wastewater is considered as a resource and developing appropriate conservation policies in this backdrop. The results obtained can be a guide in developing outdoor water conservation policies in arid regions.

Comprendre l'opposition parlementaire

Résumé Cet article entend évaluer la pertinence de l’interprétation des origines antifiscales de l’opposition parlementaire au XVIII e siècle. Il souligne d’abord que les contraintes qui pesaient sur la rédaction des remontrances interdisent une lecture purement littérale de ces textes. S’appuyant sur une série de documents relatifs aux projets financiers de Silhouette (1759), il montre ensuite que l’ambition du Parlement de Paris, jamais mentionnée dans ses remontrances, était de financer la guerre de Sept Ans par l’émission de billets de monnaie. Cette lecture met ainsi en évidence l’importance du modèle financier anglais, notamment en matière de crédit, dont Silhouette et les magistrats se sont directement inspirés. En dépit de ce point commun, les divergences entre le gouvernement et les magistrats sur les moyens de financer la poursuite de la guerre et la culture politique de la monarchie ont empêché de former un consensus solide et durable dans l’intérêt de la nation.

Credit Ratings and Litigation Risk

We develop a model of a credit rating agency in which the rating agency expends due-diligence effort to learn about the issuer's credit risk, and the precision of its rating is predicated both on this effort and the rating agency's a priori unknown ability. We model the communication of ratings as a cheap-talk game. The coarseness of ratings is endogenously solved for. Reputational concerns motivate the rating agency to expend effort to learn more in a setting in which the agency optimally chooses coarse ratings ex ante. With this model in place, we examine the impact of legal liability for on the rating agency's behavior. Like reputational concerns, legal liability is a two-edged sword. On the one hand, as the legal penalty for suspected misrating increases, the rating agency expends greater due-diligence effort, holding fixed the number of ratings. On the other hand, higher legal liability induces the rating agency to reduce the number of ratings. If the legal liability increases asymmetrically - higher legal liability only for ratings deemed ex post to be too high - the rating agency responds by increasing its downward bias in ratings. We also discuss other possible implications of recent legislative changes that have increased rating-agency legal liability.

The Dynamics of Overpricing in Structured Products

Issuers of structured products have great power when setting the price of their securities. Each issuer is the sole liquidity provider in the secondary market for her products, and short-selling is not possible. Using a large, high-frequency data set, we investigate the pricing dynamics of a class of structured products, bank-issued warrants, and show that issuers use their monopoly powers to extract wealth from investors. First, we find that warrants are more overpriced the harder they are to evaluate, and the fewer substitutes are available. Second, issuers are able to anticipate demand in the short term and preemptively adjust prices for warrants upwards (downwards) on days when investors are net buyers (sellers). Third, issuers decrease the amount of overpricing over the lifetime of most warrants, lowering returns for investors further. Lastly, while we find a negative relationship between issuer credit risk and overpricing, the effect is generally too small, is absent prior to the Lehman Brothers bankruptcy and does not conform to models of vulnerable options. Thus, issuers gain access to cheap financing.

Firm Size, Information Asymmetry and Window Dressing in Cash Holdings: Evidence from Quarterly Financial Statements

To the best of the author’s knowledge, this is first empirical paper to examine the tendency of U.S. corporate firms to engage in window dressing behavior in cash holdings. Using quarterly financial data, S&P constituents’ data, and S&P issuer credit rating data from Compustat, stock price data from Center for Research for Security Prices (CRSP), and governance index data, we find evidence of upward window dressing in cash holdings during the fourth fiscal quarter (financial year-end) even after controlling for corporate cash holdings determinants. This window dressing behavior is widespread across subsamples based on size, competition, risk, governance, and level of information asymmetry. Our findings further suggest that the upward window dressing in corporate cash holdings towards fiscal year-end is sensitive to firm size and to some extent the level of information asymmetry.

Game Analysis of Credit Issue within the Construction Agent System

Game Analysis of Credit Issue within the Construction Agent System

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How offset programs assess and approve projects and credits

Over the past decade, a number of offset programs have developed quite sophisticated processes to review offset projects, approve or reject them, and issue credits based on their performance. This paper reviews offset project approval and credit issuance processes for three compliance market programs and five programs that issue offset credits for the voluntary carbon market. It is important for policy makers to understand differences and recognize lessons learned from existing programs for the design and possible linking of future offset programs and markets. This paper provides an initial comparison of the decision making structures of offset programs and discusses best practices. It suggests that an in-depth evaluation and comparison of program performance will be necessary to identify how program design impacts offset performance and quality.

Credit and Authorship Practices: Educational and Environmental Influences

A survey on credit issues of academic chemists in U.S. Ph.D.-granting institutions was conducted. The respondents rated 15 criteria for authorship of scientific publications; core intellectual contributions received the highest ratings although making a single suggestion that was essential to the successful completion of the project was rated very low. Acquisition of data was also rated highly. The respondents rated eight potential influences on their own “policy” toward giving credit; doing what “seems to be the right thing” was the highest rated influence followed by graduate educational experiences; professional society or other responsible conduct of research (RCR) institutional policies were rated, by far, the lowest.

PENGARUH PENDAPATAN USAHA TERHADAP KEMAMPUAN PENGEMBALIAN KREDIT (Studi Kasus pada NPL (Non Performing Loan) SPP-UPK Samarang Garut Periode Januari 2007-Juni 2009)

UPK Samarang represent institute organizer of fund and activity of governmental program that is PNPM-MANDIRI Countryside inDistrict of Samarang Garut which its effort make a move in the field of channeling and management of loan of SPP and of UEP. Besides, in program budget year of UPK functioning Samarang as organizer and dealer of construction fund. Target of most important company is to get profit in the form of loan service, to be able to yield big service hence company have to strive effectively and is efficient. Attainment of company profit in the form of loan service very depend on fluent rate of return. fluent the payment of loan of fundamental goodness and also loan service of menunjukan company efektifitas in depressing the amount of jam of credit of loan have problem. This research aim to to know operating income of group member, ability of return of credit of SPP and influence of operating income to ability of return of credit of SPP. this Object Research is financial statement of SPP UPK Samarang period of January 2007 up to period of June 2009. Data which [is] used in this research isprimary data and data of sekunder, with data collecting technique through interview with delegation of group member and Bursar of UPK Samarang, observation of[is non literature study and participant. This research have the character of descriptively of verifikatif, method of explanatory survey and use case study method by using sampling technique that is technique of purposive sampling. While data processing use simple linear regression analysis. Pursuant to result of examination of statistic obtained by information that there are influence which are positive between earnings ably return of credit of UPK Samarang, hence obtained by conclusion that ability of return of credit influenced by operating income equal to 18.49% and the rest equal to 81.51% influenced by other factor like individual character, mechanism and system, institute, and economic condition in general

Influences on Authorship Issues: An Evaluation of Receiving, Not Receiving, and Rejecting Credit

A survey on credit issues was conducted of academic chemists in Ph.D. granting institutions in the United States. Six-hundred faculty members responded representing 16% of the survey recipients. Fifty percent of the respondents reported not receiving appropriate credit for contributions they had made to published projects. Neither the number of years after receiving their Ph.D., their fields of expertise, their total number of publications, nor their total number of single-author publications showed any significant relationship with the perception of not receiving appropriate credit. Twenty percent of the respondents had discovered that they were an author of a paper, after that paper had been submitted to a journal. Forty-nine percent reported that they had asked to have their name deleted as an author. Relationships between these perceptions and academic background factors were examined. For example, respondents who had asked to be removed from authorship were more likely to give authorship or an acknowledgement to others and were also more likely to have had an authorship problem with others, both of these factors being related to longevity as a publishing scientist.

Issuer Credit Quality and the Price of Asset Backed Securities

Following the financial market crisis of the past few years, critics and scholars have identified numerous problems related to all parties associated with securitization, including investors, rating agencies, issuers, underwriters, and borrowers. Some of this research focuses on the rating process itself. Adam Ashcraft, Paul Goldsmith-Pinkham, and James Vickery (2009) show that observable credit fundamentals deteriorated relative to ratings between 2005 and 2007. Efraim Benmelech and Jennifer Dlugosz (2009) find that collateralized debt obligations (CDOs) rated by only one rating agency are more likely both to be downgraded and to suffer more severe downgrades than CDOs rated by more than one agency. Joshua Coval, Jakub Jurek, and Erik Stafford (2009a) point out that ratings of CDOs were highly unreliable due to models that were highly sensitive to even small errors in economic projections or losses and that underestimated the correlation of risks across various debt securities. Other research focuses on the conflicts of interest between parties who participate in the underlying processes of originating and bundling loans and collecting payments from delinquent borrowers. Chris Downing, Dwight Jaffee, and Nancy Wallace (2009) find that some residential mortgage backed securities trade in a market for lemons where originators can use private information to determine which mortgage Issuer Credit Quality and the Price of Asset Backed Securities

Credit Card Ownership Among American High School Seniors: 1997–2008

The purpose of this study is to investigate the rise in credit card ownership rates among high school seniors in the United States. It uses the Jump$tart Coalition’s cross-sectional surveys from 1997 to 2008 to analyze the determinants of credit card ownership among high school seniors. These results show that students with credit cards are less financially literate than students without credit cards; and students with credit cards in their own names are almost twice as likely to work during the school year for money. These findings help make a case for improved financial education and training, and institutional changes that limit the pervasive issuance of credit cards to high school students.

Recent Consumer Credit Issues in the States

Recent Consumer Credit Issues in the States