SQUEEZING THE ASIAN ENTREPRENEURIAL ENGINE: THE IMPACT OF THE CREDIT SQUEEZE ON SUSTAINABLE ENTREPRENEURIAL JOB CREATION IN ASIA

2000 ◽  
Vol 08 (02) ◽  
pp. 141-167 ◽  
Author(s):  
CHRIS HALL
Keyword(s):  
Small Proportion ◽  
Job Creation ◽  
Capital Adequacy ◽  
Risk Exposure ◽  
Large Firms ◽  
Infrastructure Projects ◽  
Fast Growing ◽  
Job Growth ◽  
The Impact ◽  
New Jobs

Firms in Japan, China, Indonesia, Korea, and most of the rest of Asia, are now facing a prolonged period of very tight credit. Because many banks in the region need to increase their capital adequacy ratios and reduce their risk exposure, most are now unwilling to lend to small, fast growing firms. However, mounting evidence from OECD suggests that the bulk of net job creation comes from a relatively small proportion of fast growing SMEs. The ability to create new jobs will be especially important in Asia in the coming years, and it is unlikely that government infrastructure projects and large firms will be able to provide the job growth required.

scholarly journals A Formula For Job Creation: Tax Law Changes For Small Businesses

2011 ◽  
Vol 5 (2) ◽  
Author(s):  
Patricia T. Papachristou ◽  
James O. Parker
Keyword(s):  
Small Businesses ◽  
Job Creation ◽  
Tax Law ◽  
Font Size ◽  
Job Growth ◽  
Survival And Growth ◽  
Tax Changes ◽  
New Jobs ◽  
Tax Cuts

<p class="MsoNormal" style="text-align: justify; margin: 0in 0.5in 0pt; mso-layout-grid-align: none;"><span style="font-family: &quot;Times New Roman&quot;,&quot;serif&quot;;"><span style="font-size: x-small;">The Bush tax cuts in 2001 (Economic Growth and Taxpayer Relief Reconciliation Act, (EGTRRA) and in 2003 (Job Growth and Taxpayer Relief Reconciliation Act, JGTRRA) are touted as providing an aid to the economy's recovery and job creation. The data shows that George Bush's first administration had the most anemic job expansion in decades and actually saw negative net jobs created. We advocate four tax changes for small businesses that would postpone the timing of taxes and make it easier for small businesses to survive. As small businesses provide more than two-thirds of the net new jobs created each year, insuring their sustainability will go a long way to foster small business expansion and more job growth among suppliers. Currently a third of new small businesses fail within their first two years and the failure rate exceeds 60 percent by the end of the sixth year. These tax proposals for small businesses resemble &ldquo;laser surgery&rdquo; for the economy instead of the &ldquo;chemotherapy&rdquo; of tax cuts for the whole economy. These proposals focus where two-thirds or more of new jobs are created each year and will help small businesses manage their cash flow more effectively and encourage their long term sustainability. It is time for Congress to enact measures that help provide small businesses with a source of capital rather than draining them of the vital cash that they need. Such measures would not require government handouts or loans but, rather, would for the most part, merely entail postponing the taxation of business profits so long as those profits remained in the business to help insure its survival and growth.</span></span></p>

scholarly journals The Employment Effects of State Hiring Credits

ILR Review ◽  
2016 ◽  
Vol 70 (5) ◽  
pp. 1111-1145 ◽  
Author(s):  
David Neumark ◽  
Diego Grijalva
Keyword(s):  
Great Recession ◽  
Employment Growth ◽  
Job Creation ◽  
Employment Effects ◽  
The Great Recession ◽  
Job Growth ◽  
The Cost ◽  
The Unemployed ◽  
New Jobs ◽  
Recession Period

State and federal policymakers grappling with the aftermath of the Great Recession sought ways to spur job creation, in many cases adopting hiring credits to encourage employers to create new jobs. Virtually no evidence is available, however, on the effects of these kinds of counter-recessionary hiring credits, with the only evidence coming from much earlier studies of the federal New Jobs Tax Credit in the 1970s. This article provides evidence on the effects of state hiring credits on job growth. Some specific types of hiring credits—including those targeting the unemployed, those that allow states to recapture credits when job creation goals are not met, and refundable hiring credits—appear to have succeeded in boosting job growth, particularly during the Great Recession period and perhaps also during recessions in general. At the same time, some evidence suggests that these credits can generate much more hiring than net employment growth, consistent with the credits encouraging churning of employees that raises the cost of producing jobs through hiring credits.

scholarly journals Opening Clauses in Collective Bargaining Agreements: More Flexibility to Save Jobs?

2013 ◽  
Vol 64 (2) ◽  
Author(s):  
Tobias Brändle ◽  
Wolf Dieter Heinbach
Keyword(s):  
Collective Bargaining ◽  
Explicit Knowledge ◽  
Manufacturing Sector ◽  
Job Creation ◽  
Job Flows ◽  
Job Destruction ◽  
Data Set ◽  
Job Growth ◽  
Iab Establishment Panel ◽  
The Impact

AbstractThis paper analyses the impact of opening clauses in German collective bargaining agreements (CBAs) on job flows. Opening clauses should provide firms with more flexibility in economic crises. Therefore, firms operating under a CBA with opening clauses are expected to have lower job turnover, in particular lower job destruction under bad business conditions, and - if job creation is not adversely affected - higher job growth. We analyse this question empirically using data from the IAB Establishment Panel, a large and representative data set on German establishments. We supplement the data with additional information on the existence of opening clauses in CBAs in the West German manufacturing sector (using the IAW Data Set on Opening Clauses). By means of a matching approach, we address selection problems in flexible CBAs and reveal that the existence of opening clauses has a positive, albeit not always significant, effect on job growth. In contrast, there are no significant effects on job destruction and job creation per se, and, based on information given in the IAB Establishment Panel itself, explicit knowledge of opening clauses or their application have no additional effect on job flows.

scholarly journals The impact of the Bank of Russia’s macroprudential policy on the risk exposure of banks’ consumer loan portfolios

2021 ◽  
Vol 80 (3) ◽  
pp. 73-93
Author(s):  
Dmitry Miroshnichenko ◽  
Keyword(s):  
Time Frame ◽  
Risk Profile ◽  
Capital Adequacy ◽  
Risk Exposure ◽  
Macroprudential Policy ◽  
Debt Burden ◽  
Loan Portfolios ◽  
Consumer Lending ◽  
The Impact ◽  
Reporting Data

In this paper, the author examines the efficiency of risk weight add-ons introduced by the Bank of Russia depending on borrowers’ debt burden in terms of discouraging high-risk unsecured rouble consumer lending and the effect of these add-ons on banks’ capital adequacy. The analysis is based on open bank reporting data for the period from October 2019 through August 2020. We show that in this time frame, most banks increased their capital. At the same time, the results obtained do not enable us to confirm the hypothesis that this measure has a pronounced effect on the reduction of the risk profile of consumer loan portfolios. We demonstrate that one of the factors that influenced the efficiency of measures introduced by the regulator is the substantially higher profitability of retail lending as compared to corporate lending.

What does affect profitability of banks in Croatia?

2018 ◽  
Vol 28 (4) ◽  
pp. 338-367 ◽  
Author(s):  
Filip Fidanoski ◽  
Moorad Choudhry ◽  
Milivoje Davidović ◽  
Bruno S. Sergi
Keyword(s):  
Empirical Analysis ◽  
Economies Of Scale ◽  
Positive Impact ◽  
Management Practice ◽  
Capital Adequacy ◽  
Risk Exposure ◽  
Bank Profitability ◽  
Content Type ◽  
Dependent Variables ◽  
The Impact

Purpose The paper aims to determine the impact of bank-specific, industry-specific and macro-specific determinants on the profitability indicators – return on assets (ROA) and ratio net-interest margin (RNIM). Design/methodology/approach This research sample includes selected Croatian banks, and the empirical analysis covers the period 2007-2014. Based on the reliable and robust econometric tests, dynamic estimation technique (DOLS) was run to estimate the profitability models, by using of ROA and RNIM as dependent variables, which also include lagged dependent variables to capture the speed of mean reversion in terms of profitability, respectively. Findings The results proved the crucial positive impact of assets size (economies of scale), loan portfolio and GDP growth on the banks’ profitability. Further, the negative impacts on profitability have risks and administrative costs. This paper shows the positive impact of capital adequacy ratio (CAR) and leverage on ROA and RNIM, as well as the correlation between market concentration and banks’ profitability. Practical implications Basically, Croatian banks should improve operative efficiency and risk management practice to increase their profitability. In addition, banks should carefully balance between capital base and risk exposure on the one hand and take advantage of using relative cheaper deposits and borrowed funds instead of using more expensive equity. This conclusion is reasonable, keeping in mind that the Croatian financial market does not punish banks for an extra risk exposure caused by market imperfections. Finally, the regulatory authority in Croatia should impose some additional antitrust measures to increase competition in the banking market. Originality/value Although a bunch of existing studies explain the determinants of bank profitability from different perspectives, this paper conducts a specific empirical analysis about the determinants of bank profitability in Croatia. In addition, this paper provides a good synthesis of the relevant empirical and theoretical studies from this domain.

scholarly journals The Labor Market Structure of Transportation Sector in Indonesia: Digital Economy, Investment, Pandemic COVID-19, Job Creation Law

2021 ◽  
Vol 3 (2) ◽  
Author(s):  
Suparna Wijaya
Keyword(s):  
Time Series ◽  
Labor Market ◽  
Market Structure ◽  
Research Method ◽  
Large Scale ◽  
Job Creation ◽  
Digital Economy ◽  
Transportation Sector ◽  
The Impact ◽  
New Jobs

The development of the digital economy leads to the loss of several jobs and the emergence of new jobs. It also allows labor shifting between the new jobs and the old jobs. This phenomenon could raise the potential for unabsorbed labor which will cause unemployment problems. The COVID-19 pandemic, which requires large-scale social restrictions (PSBB), has certainly affected the transportation sector. This study aims to examine the influence of the digital economy, investment, the COVID-19 pandemic, and the Job Creation Law on the labor market structure of the transportation sector in Indonesia. The research method used is quantitative. The data used are the time series from January 2018 to November 2020. The results of this study indicate that the digital economy has no effect on the structure of the labor market in the transportation sector in Indonesia. Meanwhile, investment, the COVID-19 pandemic, and the Job Creation Law, respectively, have a significant effect on the structure of the labor market in the transportation sector in Indonesia. The impact of investment and the COVID-19 pandemic on the labor market structure of the transportation sector in Indonesia is negative. Meanwhile, the effect of the Job Creation Law on the labor market structure of the transportation sector in Indonesia is positive. Simultaneously, the digital economy, investment, the COVID-19 pandemic, and the Job Creation Law affect the labor market structure of the transportation sector in Indonesia.

The impact of formality on firm profitability in Bolivia: an heterogeneous assessment

2012 ◽  
pp. 53-74
Author(s):  
Darwin Ugarte Ontiveros
Keyword(s):  
Empirical Literature ◽  
Large Firms ◽  
Marginal Effects ◽  
Heterogeneous Effects ◽  
Firm Profitability ◽  
The Impact ◽  
Formal Status

Recent evidence suggests that formality improves micro-firms profits in Bolivia. This gain is only for firms with 2 to 5 workers, while smaller and larger firms would lose out by formalizing (McKenzie and Sakho, 2010). However, as much of the empirical literature on this topic, the estimations are based on strong assumptions about unobservables. If the returns to formality vary among firms and these variations influence selection into formality, traditional estimators are biased (Heckman and Vytlacil, 2007). In this paper we considerthese elements to estimate the heterogeneous effects of formality on firm profits in Bolivia. We find remarkable heterogeneity in the returns to formality, from -3% to 6%. The group of firms with positive marginal effects from formality corresponds to those which are most likely to register. We also characterize the firms that likely benefit from having a formal status. These would correspond to large firms which work at big scales.

scholarly journals Indicators of the Tourist Attractiveness of Urban–Rural Communes and Sustainability of Peripheral Areas

2021 ◽  
Vol 13 (12) ◽  
pp. 6968
Author(s):  
Natalia Świdyńska ◽  
Mirosława Witkowska-Dąbrowska
Keyword(s):  
Sustainable Development ◽  
Regional Development ◽  
Development Pattern ◽  
Urban Centers ◽  
Global Trends ◽  
Urban Rural ◽  
Tourist Infrastructure ◽  
Peripheral Areas ◽  
The Impact ◽  
New Jobs

The elements which determine a peripheral area’s level of tourist attractiveness, such as tourist infrastructure and tourist values, should be developed in urban–rural communes in peripheral areas, where tourism may be one of the forces capable of stimulating sustainable development. This study covered urban–rural communes of the province of Warmia and Mazury in Poland. Urban–rural communes are specific areas where urban–rural linkages are often important. The research was carried out in accordance with Hellwig’s taxonomic development pattern method. The study found no complementary relationship between tourism values and tourism infrastructure with regards to creating tourism attractiveness. Tourism attractiveness was found to be more affected by tourism infrastructure. However, in units with larger urban centers, tourist values were found to significantly contribute to tourist attractiveness. The presented results provide a good basis for further research on the impact of global trends on regional development. At the same time, the analyzed framework provides guidance for ensuring the development of local tourism, and the study’s suggested priorities and measures could lead to the development of tourism in peripheral regions, which should in turn attract new investments, create new jobs, and thus develop the economy and the welfare of the population.

scholarly journals Does the target market affect bank performance? Evidence from the geographic diversification of city commercial banks in China

2021 ◽  
Vol 15 (1) ◽  
Author(s):  
Xiaonan Li ◽  
Chang Song
Keyword(s):  
Commercial Banks ◽  
Banking Sector ◽  
Capital Adequacy ◽  
Bank Performance ◽  
Chinese Government ◽  
Target Market ◽  
Geographic Diversification ◽  
Cross Sectional ◽  
The Impact ◽  
Geographical Diversification

AbstractAfter the opening up of the banking sector to domestic and foreign capitals which is approved by the Chinese government, the China Banking Regulatory Commission (CBRC) has permitted city commercial banks to diversify geographically. Since this deregulation in 2006, city commercial banks began to geographically diversify to occupy the market and acquire more financial resources. To examine the causal relationship between geographical diversification and bank performance, we construct an exogenous geographical diversification instrument using the gravity-deregulation model and a policy shock. We find that bank geographical diversification negatively affects bank performance. Moreover, we conduct some mechanism tests in the Chinese context. We find that the target market with several large- and medium-sized banks and a high level of local protectionism in the target market decreases the performance of city commercial banks. Finally, cross-sectional analyses show that the impact of geographical diversification on banks’ performance is more notable among city commercial banks that are younger, and have a lower capital adequacy ratio and a higher non-performing loan ratio.

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