Asset Volatility and Capital Structure: Evidence from Corporate Mergers

2020 ◽  
Author(s):  
Oliver Levine ◽  
Youchang Wu
Keyword(s):  
Capital Structure ◽  
Direct Evidence ◽  
Coefficient Estimates ◽  
Firm Risk ◽  
Cross Sectional ◽  
Corporate Acquisitions ◽  
Percentage Point Increase ◽  
Point Increase ◽  
Asset Volatility ◽  
Debt Capacity

We exploit cross-sectional variation in the predictable changes in asset volatility following corporate acquisitions to identify the effect of business risk on capital structure. We find that postmerger changes in leverage and cash holdings are strongly predicted by expected asset volatility changes estimated using premerger information. These capital structure adjustments are partly achieved through the choice of payment method. Our findings provide direct evidence for the coinsurance effect of mergers on debt capacity. More broadly, they suggest that firm risk is a first-order determinant of leverage, consistent with the tradeoff theory of capital structure. Our coefficient estimates imply that a one-standard deviation decline in a firm’s asset volatility corresponds to a 7.5-percentage point increase in leverage. This paper was accepted by Renee Adams, finance.

scholarly journals Do Strict Capital Requirements Raise the Cost of Capital? Bank Regulation, Capital Structure, and the Low-Risk Anomaly

2015 ◽  
Vol 105 (5) ◽  
pp. 315-320 ◽  
Author(s):  
Malcolm Baker ◽  
Jeffrey Wurgler
Keyword(s):  
Capital Structure ◽  
Stock Returns ◽  
Cost Of Capital ◽  
Weighted Average ◽  
Capital Requirements ◽  
Structure Theory ◽  
Treasury Bills ◽  
Percentage Point Increase ◽  
Point Increase ◽  
The Cost

Traditional capital structure theory predicts that reducing banks' leverage reduces the risk and cost of equity but does not change the weighted average cost of capital, and thus the rates for borrowers. We confirm that the equity of better-capitalized banks has lower beta and idiosyncratic risk. However, over the last 40 years, lower risk banks have not had lower costs of equity (lower stock returns), consistent with a stock market anomaly previously documented in other samples. A calibration suggests that a binding ten percentage point increase in Tier 1 capital to risk-weighted assets could double banks' risk premia over Treasury bills.

scholarly journals Ultra-processed foods and added sugars in the Chilean diet (2010)

2017 ◽  
Vol 21 (1) ◽  
pp. 125-133 ◽  
Author(s):  
Gustavo Cediel ◽  
Marcela Reyes ◽  
Maria Laura da Costa Louzada ◽  
Euridice Martinez Steele ◽  
Carlos A Monteiro ◽  
...  
Keyword(s):  
Total Energy ◽  
Energy Intake ◽  
Total Energy Intake ◽  
Processed Foods ◽  
Food Groups ◽  
Dietary Recommendations ◽  
Cross Sectional ◽  
Added Sugars ◽  
Percentage Point Increase ◽  
Point Increase

AbstractObjectiveTo assess the consumption of ultra-processed foods and analyse its association with the content of added sugars in the Chilean diet.DesignCross-sectional study of national dietary data obtained through 24 h recalls and classified into food groups according to the extent and purpose of food processing (NOVA classification).SettingChile.SubjectsA probabilistic sample of 4920 individuals (aged 2 years or above) studied in 2010 by a national dietary survey (Encuesta Nacional de Consumo Alimentario).ResultsUltra-processed foods represented 28·6 (se 0·5) % of total energy intake and 58·6 (se 0·9) % of added sugars intake. The mean percentage of energy from added sugars increased from 7·7 (se 0·3) to 19·7 (se 0·5) % across quintiles of the dietary share of ultra-processed foods. After adjusting for several potential sociodemographic confounders, a 5 percentage point increase in the dietary share of ultra-processed foods determined a 1 percentage point increase in the dietary content of added sugars. Individuals in the highest quintile were three times more likely (OR=2·9; 95 % CI 2·4, 3·4) to exceed the 10 % upper limit for added sugars recommended by the WHO compared with those in the lowest quintile, after adjusting for sociodemographic variables. This association was strongest among individuals aged 2–19 years (OR=3·9; 95 % CI 2·7, 5·9).ConclusionsIn Chile, ultra-processed foods are important contributors to total energy intake and to the consumption of added sugars. Actions aimed at limiting consumption of ultra-processed foods are being implemented as effective ways to achieve WHO dietary recommendations to limit added sugars and processed foods, especially for children and adolescents.

scholarly journals Inflation Expectations and Readiness to Spend: Cross-Sectional Evidence

2015 ◽  
Vol 7 (1) ◽  
pp. 1-35 ◽  
Author(s):  
Rüdiger Bachmann ◽  
Tim O. Berg ◽  
Eric R. Sims
Keyword(s):  
Lower Bound ◽  
Inflation Expectations ◽  
Zero Lower Bound ◽  
Cross Sectional ◽  
Percentage Point Increase ◽  
Expected Inflation ◽  
Percentage Points ◽  
Point Increase ◽  
The Impact ◽  
The Relationship

There have been suggestions for monetary policy to engineer higher inflation expectations to stimulate spending. We examine the relationship between expected inflation and spending attitudes using the microdata from the Michigan Survey of Consumers. The impact of higher inflation expectations on the reported readiness to spend on durables is generally small, outside the zero lower bound, often statistically insignificant, and inside of it typically significantly negative. In our baseline specification, a one percentage point increase in expected inflation during the recent zero lower bound period reduces households' probability of having a positive attitude towards spending by about 0.5 percentage points. (JEL D12, D84, E21, E31, E52)

scholarly journals Satisfaction of Township Hospitals Health Workers on How They Are Paid in China

2021 ◽  
Vol 18 (22) ◽  
pp. 11978
Author(s):  
Beibei Yuan ◽  
Yahang Yu ◽  
Hongni Zhang ◽  
Huiwen Li ◽  
Chen Kong ◽  
...  
Keyword(s):  
Performance Feedback ◽  
Health Workers ◽  
Cross Sectional Study ◽  
Negative Influence ◽  
Work Behavior ◽  
Cross Sectional ◽  
Percentage Point Increase ◽  
Point Increase ◽  
Personal Performance ◽  
Township Hospitals

Background: Township Hospitals (THs) are crucial providers in China’s primary health delivery system. Low job satisfaction of THs health workers has been one of biggest challenges to strengthening the health system in China. Even huge amounts of studies confirmed low remuneration level as a key demotivating factor though few studies have explored the feelings of health workers on how they were paid. Objective: To analyze how the key design of Performance-based Salary System (PBS) influences the satisfaction of health workers on the payment system in China’s THs. Method: A cross-sectional study was conducted in 47 THs in Shandong China, and a total of 1136 participants were recruited. Expectancy theory was applied to design the measurements on designs of PBS. The associations between PBS design and satisfaction of health workers were analyzed by logistic regression. Results: Three key components of PBS design were all related to the satisfaction of health workers. Those health workers who were aware of assessment methods were more likely to be satisfied with how they were paid (OR = 2.44, p < 0.001) compared with those being not aware of the methods. The knowledge on personal performance was also associated with being satisfied (OR = 3.34, p < 0.001). The percentage of floating income in total income was negatively associated with the satisfaction, and one percentage point increase in floating income proportion could result in the possibility of being satisfied decreasing by 2.82% (95%CI −4.9 to −0.7, p = 0.01). Subgroup analysis found that only in those with lower value on monetary income, the negative influence of more floating income was significant. Conclusions: When policymakers or managers apply performance-related payment to incentivize certain work behavior, they should pay attention to the design details, including keeping transparency in the performance assessment criteria, clear performance feedback, and setting the proportion of the performance-related part based on the preference of health workers in certain cultural settings.

scholarly journals The impact of a personalized, community-based counselling and referral programme on modern contraceptive use in urban Ghana: a retrospective evaluation

2020 ◽  
Author(s):  
Elizabeth G Henry ◽  
Kristy M Hackett ◽  
Ayaga Bawah ◽  
Patrick O Asuming ◽  
Caesar Agula ◽  
...  
Keyword(s):  
Family Planning ◽  
Contraceptive Use ◽  
Modern Contraceptive ◽  
Community Based ◽  
Cross Sectional ◽  
Percentage Point Increase ◽  
Point Increase ◽  
Intervention Area ◽  
Matched Comparison ◽  
The Impact

Abstract Community-based demand-generation family planning programmes have been associated with increased contraceptive use in rural areas of Ghana. However, rigorous evaluations of such programmes in urban contexts are lacking. We used a retrospective, cross-sectional with comparison group design to estimate the immediate and sustained impact of the Willows intervention on modern contraceptive use in Kumasi, Ghana. The Willows intervention is a home-based counselling and referral programme for women in low-income urban settlements. We analysed data from a cross-sectional representative survey of 1205 women of reproductive age in the intervention area and 1108 women in a matched comparison site. The main outcome was women’s reported contraceptive use at: (1) baseline (January 2013); (2) programme close (December 2016); and (3) follow-up (August to October 2018). We estimated the programme effect at the community level and for women who reported receiving a family planning counselling visit. We used coarsened exact matching to assess the impact of the intervention relative to outcomes for matched comparison women. Comparing those who reported a family planning visit in the intervention area with matched comparison area women who reported no visit, we estimated a 10.5 percentage point increase in use of modern contraceptives from baseline to close (95%CI : 6.2, 14.8; P &lt; 0.001) and a 7.6 percentage point increase from baseline to follow-up (95%CI : 3.3, 11.9; P &lt; 0.001). However, only 20.2% of women in the Willows intervention area reported a visit. The Willows intervention, therefore, did not achieve its aim to reach all reproductive-aged women in the community. At the community level, we found no significant effect of the intervention at either programme close or 2 years later. We recommend that similar community-based interventions strive for greater outreach and simultaneously launch robust prospective impact evaluations.

scholarly journals Inequalities in COVID19 mortality related to ethnicity and socioeconomic deprivation

2020 ◽  
Author(s):  
Tanith C. Rose ◽  
Kate Mason ◽  
Andy Pennington ◽  
Philip McHale ◽  
Iain Buchan ◽  
...  
Keyword(s):  
Mortality Rate ◽  
Low Income ◽  
Negative Binomial ◽  
Mortality Rates ◽  
Ethnic Composition ◽  
Effective Control ◽  
Local Authorities ◽  
Cross Sectional ◽  
Percentage Point Increase ◽  
Point Increase

AbstractBackgroundInitial reports suggest that ethnic minorities may be experiencing more severe coronavirus disease 2019 (COVID19) outcomes. We therefore assessed the association between ethnic composition, income deprivation and COVID19 mortality rates in England.MethodsWe performed a cross-sectional ecological analysis across England’s upper-tier local authorities. We assessed the association between the proportion of the population from Black, Asian and Minority Ethnic (BAME) backgrounds, income deprivation and COVID19 mortality rates using multivariable negative binomial regression, adjusting for population density, proportion of the population aged 50–79 and 80+ years, and the duration of the epidemic in each area.FindingsLocal authorities with a greater proportion of residents from ethnic minority backgrounds had statistically significantly higher COVID19 mortality rates, as did local authorities with a greater proportion of residents experiencing deprivation relating to low income. After adjusting for income deprivation and other covariates, each percentage point increase in the proportion of the population from BAME backgrounds was associated with a 1% increase in the COVID19 mortality rate [IRR=1.01, 95%CI 1.01–1.02]. Each percentage point increase in the proportion of the population experiencing income deprivation was associated with a 2% increase in the COVID19 mortality rate [IRR=1.02, 95%CI 1.01–1.04].InterpretationThis study provides evidence that both income deprivation and ethnicity are associated with greater COVID19 mortality. To reduce these inequalities, Government needs to target effective control and recovery measures at these disadvantaged communities, proportionate to their greater needs and vulnerabilities, during and following the pandemic.FundingNational Institute of Health Research; Medical Research Council

scholarly journals Measuring Social Unrest Using Media Reports

2020 ◽  
Vol 20 (129) ◽  
Author(s):  
Philip Barrett ◽  
Maximiliano Appendino ◽  
Kate Nguyen ◽  
Jorge de Leon Miranda
Keyword(s):  
Time Series ◽  
Average Rate ◽  
Cross Sectional ◽  
Social Unrest ◽  
Percentage Point Increase ◽  
Monthly Time Series ◽  
Point Increase ◽  
Percent Increase ◽  
External Sources ◽  
Media Reports

We present a new index of social unrest based on counts of relevant media reports. The index consists of individual monthly time series for 130 countries, available with almost no lag, and can be easily and transparently replicated. Spikes in the index identify major events, which correspond very closely to event timelines from external sources for four major regional waves of social unrest. We show that the cross-sectional distribution of the index can be simply and precisely characterized, and that social unrest is associated with a 3 percentage point increase in the frequency of social unrest domestically and a 1 percent increase in neighbors in the next six months. Despite this, social unrest is not a better predictor of future social unrest than the country average rate.

scholarly journals Impact of home-based family planning counselling and referral on modern contraceptive use in Karachi, Pakistan: a retrospective, cross-sectional matched control study

BMJ Open ◽  
2020 ◽  
Vol 10 (9) ◽  
pp. e039835
Author(s):  
Kristy Hackett ◽  
Elizabeth Henry ◽  
Imtiaz Hussain ◽  
Mirbaz Khan ◽  
Khalid Feroz ◽  
...  
Keyword(s):  
Family Planning ◽  
Contraceptive Use ◽  
Community Level ◽  
Secondary Outcome ◽  
Modern Contraceptive ◽  
Cross Sectional ◽  
Percentage Point Increase ◽  
Point Increase ◽  
The Cost

ObjectivesTo assess: (1) the impact of a reproductive health program on modern contraceptive use from baseline to program close; (2) the sustained impact from baseline to follow-up 36 months later; and (3) the exposure-adjusted impact at program close and follow-up.DesignRetrospective, cross-sectional matched control study.SettingKarachi, Pakistan.Participants2561 married women aged 16–49 years.InterventionsThe Willows Program, a community-based family planning counselling and referral program implemented from 2013 to 2015.Primary and secondary outcome measuresThe primary outcome was community-level modern contraceptive prevalence rate (mCPR), measured for January 2013 (baseline), June 2015 (program close) and at follow-up 36 months later. A secondary outcome was exposure-adjusted mCPR (among women reporting a family planning home visit) at program close and at follow-up.ResultsThere was no significant effect on community-level mCPR at program close (2.4 percentage point increase in intervention over comparison; 95% CI −2.2 to 7.0) or at follow-up (1.9 percentage point decrease; 95% CI −6.7 to 2.8). Only 18% of women in the intervention area reported receiving a family planning visit in the preceding 5 years. Among those reporting a visit, we observed a significant 10.3 percentage point increase (95% CI 4.6 to 15.9) from baseline to close, and a non-significant 2.0 percentage point increase (95% CI −3.8 to 7.8) from baseline to follow-up, relative to matched women in the comparison area. The cost per new modern method user was US$1089, while the cost per user-year during the intervention period was US$455.ConclusionsThe program had a positive short-term effect on women who received a family planning visit; however, this effect was not sustained. Program coverage was low and did not significantly increase community-level family planning use. Findings highlight the need to increase community coverage of high-quality counselling and contextually relevant interventions for family planning demand generation.

scholarly journals Trends in the use of mind-altering drugs among European adolescents during the Great Recession

2020 ◽  
Author(s):  
Nicoletta Balbo ◽  
Piergiorgio Carapella ◽  
Veronica Toffolutti
Keyword(s):  
Great Recession ◽  
Social Protection ◽  
Illicit Drug ◽  
Macroeconomic Fluctuations ◽  
Cross Sectional ◽  
The Great Recession ◽  
Percentage Point Increase ◽  
Point Increase ◽  
School Survey ◽  
Alcohol And Other Drugs

Despite the growing evidence of health-responses to macroeconomic fluctuations, little research has been carried out on the economic reflexes of licit and illicit drug-consumption, especially among teenagers. This paper uses data on adolescents between 15 and 17 years old from 25 European countries to test, if and how the substance-use pattern has changed during the Great Recession. The data come from two cross-sectional waves (2007 and 2011) of the European School Survey Project on Alcohol and Other Drugs (ESPAD) (n= 137,989 individuals). One percentage point increase in the unemployment rate is associated with an increase [decrease] in the probability of having tried inhalants and cocaine [ecstasy] at least once, by about 0.005 (95% CI: 0.004, 0.006) and 0.001 (95% CI: 0.0001, 0.001) [-0.001 (95% CI: -0.001, -0.001)] respectively. Social protection expenditure reduces the use of inhalants, whereas ecstasy consumption rises. The pattern for cocaine is unclear.

Immigration and anti-immigrant voting in the 2017 German parliamentary election

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Kim Leonie Kellermann ◽  
Simon Winter
Keyword(s):  
Parliamentary Election ◽  
Cross Sectional ◽  
Instrumental Variable Analysis ◽  
Percentage Point Increase ◽  
Point Increase ◽  
Negative Effect ◽  
Election Results ◽  
Immigrant Voting ◽  
Sectional Analysis ◽  
The Relationship

Abstract We empirically examine the relationship between immigration and votes for the Alternative für Deutschland (AfD) in the 2017 German parliamentary election. We conduct a cross-sectional analysis, exploiting election results and socio-demographic as well as geographic features of the 401 German administrative districts. We find that immigration has a negative effect on AfD voting. A 1 percentage point increase in the share of foreigners is associated with a decrease in the AfD vote share of up to 0.37 percentage points. The result is robust to several estimation variations, such as addressing the potentially endogenous distribution of foreigners with an instrumental variable analysis.

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