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What drives short-term credit spreads: credit risk, liquidity risk, or both? We investigate this issue using the structural approach to credit risk modeling and a novel data set of secondary market transaction prices for Chinese commercial papers (CPs). In particular, we propose and test a structural model with jump risk and exogenous market illiquidity under which the predicted yield spreads can be decomposed into a credit component and a liquidity component. We find that credit risk and, especially liquidity risk, are important determinants of short-term yield spreads. Our model-based decomposition results show that, on average, credit risk and market liquidity account for about 25% and 52% of CP yield spreads, respectively. For comparison, we also examine the drivers of the US CP yield spreads using security-level data. We find that credit risk accounts for a small fraction of the observed yield spreads but liquidity contributes a much greater proportion.

In this paper, we contribute to the topic of the non-performing loans (NPLs) business profitability on the secondary market by developing machine learning-based due diligence. In particular, a loan became non-performing when the borrower is unlikely to pay, and we use the ability of the ML algorithms to model complex relationships between predictors and outcome variables, we set up an ad hoc dependent random forest regressor algorithm for projecting the recovery rate of a portfolio of the secured NPLs. Indeed the profitability of the transactions under consideration depends on forecast models of the amount of net repayments expected from receivables and related collection times. Finally, the evaluation approach we provide helps to reduce the ”lemon discount” by pricing the risky component of informational asymmetry between better-informed banks and potential investors in particular for higher quality, collateralised NPLs.

I investigate how covenants, intrinsic to Collateralized Loan Obligation (CLO) indentures, provide a mechanism through which idiosyncratic shocks may be amplified, imposing negative externalities on other unrelated firms in CLO portfolios. To this aim, I exploit cross-sectional variation in CLO exposure to the Oil & Gas (O&G) industry, as well as the timing of the O&G bust in 2014 to study how non-O&G firms in CLO portfolios are affected. I find that when CLOs are subject to idiosyncratic shocks that push them closer to their covenant constraints, they fire-sell unrelated loans in the secondary loan market to alleviate these constraints. The ex-post, secondary market spread becomes the effective cost of capital for these innocent bystanders, as the expected rate of return across debt instruments is equalized in market equilibrium. In response, firms make financial and real adjustments. These adjustments are most pronounced for riskier firms held in CLO portfolios, whose loans are marked at market prices, as selling mark-to-market loans can generate greater slack in the covenant constraints. As the sample period for this study is 2012-2017, a relatively benign macroeconomic period, the effects may be significantly larger during times of stress such as Spring of 2020, at the outset of the COVID-19 pandemic.

We look at the association between the price of a cryptocurrency and the secondary market prices of the hardware used to mine it. We find the prices of the most efficient Graphical Processing Units (GPUs) for Ethereum mining are significantly positively correlated with the daily price returns to that cryptocurrency.

This paper provides a parsimonious and unified explanation for randomized selling mechanisms widely used in practice, yet commonly perceived as puzzling. We show that randomization implemented via opaque pricing and underpricing is optimal only if the revenue function with market clearing pricing is non-concave. Randomization involves conflation and rationing and, relative to market clearing pricing, leads to larger quantities sold. If this quantity effect is sufficiently strong, randomization increases consumer surplus. For fixed quantities resale increases consumer surplus. However, if resale is sufficiently efficient then consumer surplus can be larger under resale prohibition because resale reduces the equilibrium quantities.

We analyze a novel dynamic pricing problem, where not only the demand depends on the dynamic selling price, but also the supply can be influenced through the dynamic acquisition price. This paper is motivated by firms that acquire and resell pre-owned items, such as cell phones. A firm with fixed inventory is always under pressure to sell the remaining inventory, yet when acquisition opportunities arise, the firm may become under pressure to acquire inventory in anticipation of a surge in demand. We establish conditions under which the firm will find itself under pressure to acquire versus pressure to sell. We study how the optimal acquisition and selling prices, and the difference between them (the optimal margin) behaves with respect to time and inventory. In addition, we devise heuristics with fixed prices based on a deterministic approximation, and we evaluate how much the firm gains by using a dynamic acquisition or selling price as opposed to fixing them at the beginning of the horizon.

This paper investigates the impacts of road investments in secondary markets, which the authors label wider local impacts. The impacts are studied using four indicators: commuting, population, new firms, and employment. We use the synthetic control method to study the counterfactual problem, namely what would have happened if a given project had not been realised. The method is used to compare municipalities that had been given a new road with municipalities that had not had a new road. The study sample consists of ten road projects that opened for traffic between 2000 and 2010 and the impacts of the projects are examined at municipal level. The results do not provide a clear answer as to whether road projects are a suitable tool for fulfilling political objectives of improving the local economy. Apart from possibly one exception, none of the projects scored positively on all indicators. We identify several examples of significant negative impacts as a result of road investments, and conclude that although the impacts have been positive in many areas, there is no evidence that road investments are generally a potent tool for achieving positive wider local impacts.

This article proposes a framework as a remedial action scheme (RAS) for close to real-time system operation when system operator becomes aware of possibility of decentralized outages due to simultaneous attacks on several market retailers. The upper level of the framework is an offline RAS where system operator immediately implements a customized reconfiguration preventing the decentralized outages. Due to immediate implementation of upper-level reaction, it is possible to face decentralized congestions in the new topology having minimum reliance on the attacked market retailers. Since severity of congestions is less than that of outages, the lower level of the framework is implemented as an online RAS. In this level, eligible nonattacked market retailers are invited into a secondary market to compete for generation/consumption redispatch and contribute into alleviation of congestions with the purpose of increasing their income. The effectiveness of the proposed framework is validated on a well-known 136-bus distribution system.

The paper uses a panel VAR framework to estimate the impact of a series of reforms aimed at reducing transactions cost and information cost in India’s secondary market for equity, on trading cost and trading volume. In particular, we focus on the reforms that were introduced after the creation of the National Stock Exchange (NSE) and screen-based trading that have been much discussed in the literature. Our results suggest that only the creation of the clearing corporation that reduced or eliminated counterparty risk had an economically meaningful/significant impact on trading cost and volume. We also find that the impact was much greater for mid-cap firms and, to a lesser extent, for small-cap firms than for large-cap firms. Further, while trading costs and trading volumes Granger cause each other for mid-cap firms, there is only one-way causality for large-cap firms—trading cost Granger causes volume but the reverse is not true, and for small-cap firms there is no causal relationship between the two. The policy implications of these findings are discussed in the paper.

The market for bourbon whiskey is booming. Demand is so great that bourbon aficionados regularly line up overnight for the chance to purchase a single bottle and high-end bourbons are allocated to consumers via lotteries. The prevalence of such non-price allocation mechanisms, however, leads to reselling in secondary markets. To characterize bourbon secondary markets, we first provide a rich description of how they function. We then use 2011 to 2019 whiskey auction data in a repeat sales regression framework to develop a novel price index for rare and vintage bourbons. Our repeat sales approach suggests that bourbon prices are increasing by about 9.1% per year over our sample period. We complement those estimates by developing a second price index using unique data from an illicit peer-to-peer secondary market that operated on a major social network between 2014 and 2017. Our estimates suggest that price increases are similar, at least during common sample periods, in our auction-house and peer-to-peer settings. We also examine how bourbon’s hedonic characteristics are related to secondary market prices and develop hedonic estimates of annual returns that range between 13.1% and 18.8%. While our sample period is relatively short, when examining bourbon’s potential as an alternative investment we find that the addition of bourbon can improve the risk-return ratio of typical stock/bond portfolios.

By allowing different agency mortgage-backed securities (MBS) to be traded based on limited characteristics, the to-be-announced (TBA) market generates liquidity and benefits the MBS market broadly. We quantify effects of the TBA structure on mortgage borrowers. Exploiting discontinuities in TBA eligibility, we estimate that TBA eligibility reduces mortgage rates by 7 to 28 basis points. The TBA eligibility benefit is larger for mortgages with higher expected prepayments. We also find that TBA eligibility affects refinancing, which has implications for monetary policy transmission. Our finding is relevant for housing policies, such as housing finance reforms and uniform MBS. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

PurposeIn initial public offerings (IPOs), the media plays a pivotal role by disseminating the information to the investors who generally lack the expertise to understand the information through the prospectus. Thus, media coverage can impact the investment decision of the investors and the IPO performance. Media typically covers the IPO before listing, suggesting that it may play an important role in explaining the opening price rather than the closing price on the day of listing. Therefore, this study aims to disaggregate the traditional IPO underpricing into three categories: voluntary, pre-market and post-market and provides a comparative analysis of the media sentiments impact on the traditional and disaggregated IPO underpricing. The authors’ disaggregated IPO underpricing analysis will facilitate the investors in making an effective investment strategy based on media sentiments.Design/methodology/approachThe study deploys sentiment analysis using bags of n (2) grams approach to gauge the sentiments on 2,891 media articles and uses “robust-regression” technique to analyze them on a sample of 222 Indian IPOs during 2009–2018.FindingsThe study reports that the sentiment score is positively related to the traditional underpricing; the sentiment score is positively associated with the pre-market underpricing and does not have any significant relationship with the post-market underpricing; the number of media articles does not play a significant role in explaining the IPO underpricing. The findings highlight the presence of a semi-strong form of efficiency in the Indian IPO market.Originality/valueExisting literature focuses that the role of media on IPO performance is based on the developed countries. IPO laws differ based on the countries. For instance, in India, investors can check the demand by the other categories of investors on a real-time basis. Thus, it is interesting to study whether, with such a high level of transparency, media can explain IPO performance in the Indian market. Media generally covers IPO before listing; therefore, the present study disaggregates the IPO underpricing to evaluate the role of media on the primary and secondary market separately. It will help the investors to decide when to enter and exit the market.

We examine the microstructure of liquidity provision in the COVID-19 corporate bond liquidity crisis. During the two weeks leading up to Federal Reserve System interventions, volume shifted to liquid securities, transaction costs soared, trade-size pricing inverted, and dealers, particularly non-primary dealers, shifted from buying to selling, causing dealers’ inventories to plummet. Liquidity provisions in electronic customer-to-customer trading increased, though at prohibitively high costs. By improving dealer funding conditions and providing a liquidity backstop, the Primary Dealer Credit Facility and the Secondary Market Corporate Credit Facility (SMCCF) stabilized trading conditions. Most of the impact of SMCCF on bond liquidity seems to have materialized following its announcement. We argue that the Federal Reserve's actions reflect a new role as market maker of last resort.

Limited partners (LPs) of private equity funds commit to invest with significant uncertainty regarding the timing of capital calls and payoffs and extreme restrictions on liquidity. Secondary markets have emerged which alleviate some of the associated cost. This paper develops a subjective valuation model that incorporates these institutional features. For a risk-averse LP private equity values are highly sensitive to the time-varying discount observed in secondary market transactions. Model-implied breakeven returns generally exceed empirically observed returns. Only for highly risk-tolerant LPs who can access above-average funds and an efficient secondary market are the costs of private equity justified by performance. Preliminary; please do not circulate *Corresponding author. Contact information: Nicolas P.B. Bollen, The Owen Graduate School of Management, Vanderbilt University, 401 21 Avenue South, Nashville, TN 37203, Telephone: 615-343-5029, Email: nick.bollen@owen.vanderbilt.edu. Berk A. Sensoy, Department of Finance, Fisher College of Business, Ohio State University, Columbus, OH 43210, Telephone: 614-292-3217, email: sensoy.4@osu.edu. For helpful comments and discussions, we thank Nick Crain and seminar participants at Boston College, University of Michigan, University of Utah, and Vanderbilt University. This research is supported by the Financial Markets Research Center at Vanderbilt University and The Risk Institute at the Fisher College of Business, Ohio State University.

Purpose The purpose of this paper is to investigate investor behavior in the market of peer-to-peer lending, which is an alternative form of finance, from the liquidity perspective. Design/methodology/approach Liquidity metrics and regressions are used to identify the trend of the market and the variables that significantly impact the successful resale, selling time and discount rate in the secondary market. Structural break analysis is used to examine the impact of COVID on the market. Findings There is a high demand for performing loans that are sold quickly; however, the discount rate is also high, which reflects the price of liquidity. Based on the results obtained from regressions, the main factors that impact the investors’ decisions are discount rate, borrower’s country, principal and the month passed after loan origination. Furthermore, it can be concluded that the pandemic has led to a structural break in March 2020, and investors have started to liquidate their claims. Practical implications This paper’s purpose is to add to the research that examines the secondary market in social lending. It also contributes to the understanding of an investor’s decision and behavior, which are key parts of the segment’s long-term sustainability from the demand perspective. The comprehensive understanding of a lender’s behavior is also essential for supervisory authorities and other participants of the financial market. Originality/value Previous studies mostly focused on credit risk aspects, whereas this paper contributes to the modest research of liquidity features. The added value of this paper is further supported by the use of a large European secondary market data set, including more than 5 million transactions, covering an 18-month horizon. Moreover, the market’s sensitivity is analyzed in the case of an external shock. In the beginning of 2020, the COVID outbreak caused an economic shutdown in many European countries. The paper examines how these uncertain economic conditions impact the secondary market.

We investigate the new reality of exchange-traded funds (ETFs). We show that most ETFs are active investments in form (designed to generate alpha) or function (serve as building blocks of active portfolios). We define a new activeness index to capture these dimensions, finding that the cross-section of ETFs is now increasingly characterized by highly active investment vehicles. Active-in-form ETFs have positive flow-performance sensitivity, charge the highest fees among ETFs, and have high within-portfolio turnover. Active-in-function ETFs have more concentrated holdings, less within-portfolio turnover, but higher turnover in the secondary market. We show how more active ETFs are gaining market share over less active ETFs, leading to competitive fee pressure both within the ETF space and across the investment management industry. We suggest that the growing activeness of ETFs may assuage concerns about ETFs harming price discovery.

Mandated post-trade transparency in secondary markets lowers the cost of issuing corporate bonds. We show that costs are lower due to the mitigation of information asymmetry in the issuing process. Three pieces of evidence support this finding. First, new issues with higher information asymmetry experience relatively larger reductions in issuing costs. These bonds also experience lower reductions in trading activity than lower information asymmetry bonds, so liquidity cannot explain these results. Second, when a larger fraction of trades in comparable bonds are made post-trade transparent, new issue pricing improves. This holds when conditioning on expected bond liquidity. Third, transparency raises prices in the secondary market, but not by as much as it does for newly issued bonds.

Market sentiments influence the dynamics of Hong Kong’s macro-critical property market, but the unobservable nature of market sentiments makes it difficult to assess systemically this sentiment channel. Using text-mining techniques, this paper sets up a news-based property market sentiment index and a Google Trends-based buyer incentive index for Hong Kong, and studies the sentiment channel of transmission in the Hong Kong property market. The news-based property market sentiment index can reflect the change in sentiments in past key events, with the sentiments in the primary market tending to lead that of the secondary market during the low housing supply period. For the Google Buyer Incentive Index, we find that it has value-added in forecasting (or nowcasting) the official property price index. In mapping out the sentiment channel using a structural vector-autoregressive (SVAR) model, we find that an improvement in market sentiments could stimulate buyers’ incentives, which then together would affect property prices and transaction volumes.

In the conditions of fierce competition in the market of banking products, commercial banks should develop measures to attract attention of customers and to develop their loyalty to the banking institution, the develop its brand and to increase its capital. It has been established on the basis of the analysis of secondary marketing information that the bank’s marketing communications play a significant role in this, but it is important to ensure the growth of their efficiency. This can be achieved using a segment-oriented approach to their development. The goal of the present article is to establish the preferences in different segments of the banking product market as far as certain marketing policy tools of the banking institution’s communications are concerned as well as to identify the features of the banking product market segmentation that reflect the difference in such preferences. The results of the collection and processing of the primary marketing information obtained from customer surveys and processed using the criterion allowed to establish the dependence of the impact of marketing communications tools of commercial banks on customers depending on their age and the actual absence depending on the customer gender. During information collection and processing all respondents were divided into three groups: of 18—35, 36—60, and above 60, depending on their age. Taking into account the results of the survey, the recommended structure of marketing communication components for banking institutions depending on the affiliation of customers to a certain market segment was developed, the means of dissemination of information appeals, recommended measures aimed at dissemination and their main content were identified. The analysis revealed that some tools of marketing communications of banking institutions affect customers belonging to different market segments. Here we primarily speak about personal sale and consulting customers during personal sale, implementation of the bank’s measures aimed at environmental protection, increased rates for deposit products. At the same time, it has been established that other bank marketing communication tools have an impact only on a certain target customer group. In particular, advertising on television and radio can be important for providing information to people above 60, and information on bank websites — to younger people. Public relations measures also differ in terms of the efficiency of their impact on respondents of different age. To be more specific, health care funding measures are more important for the elderly people, while assistance provision to the needy is more important for young and middle-aged people. Keywords: marketing communication policy, commercial bank, segment-oriented approach, advertising, personal sale, public relations, sales promotion measures. JEL Classification G20, G21, M31, M39 Formulas: 0; fig. 1; tabl. 7; bibl.: 14

This paper models optimal release prices of an experience good recurrently issued on markets. Using a large sample of Bordeaux wines, we find that not only intrinsic but also extrinsic attributes affect release prices. We observe a significant relationship between primary market release prices and secondary market prices and general economic conditions. Release prices can deviate from secondary market prices in the short run but remain aligned over the long run. On average, Bordeaux wine producers have excessively increased wine prices leading to an 18% overpricing between 2004 and 2018. Finally, following the COVID-19 pandemic, Bordeaux wine should be offered at a 20% price discount in 2020

This article examines the mechanisms now available to tokenize real asset ownership and create active secondary markets in tokenized or fractionalized units. Real estate is lumpy and illiquid, and tokenization would allow participation in the market by a broader group of investors and the ability to build diversified portfolios with modest sums of money. However, two developments are necessary for the digital tokenization of single real estate assets: (1) an expressed demand for the fractionalization of single real estate assets, and (2) market participants need to be comfortable with blockchain, the digital underpinning of tokenization. Further, in many land markets fractionalization requires an intermediate structure to be established because the direct ownership of land cannot be shared amongst many, increasing the cost of tokenization. Larger assets already held in fund structures may eventually be tokenized successfully; there may also be an alternative market for tokenized residential, social impact, or community assets where investment regulation and risk/return are not the main drivers of behavior. The mass market for the tokenization of single commercial real estate assets, however, may be some way down the road. TOPICS:Real estate, exchanges/markets/clearinghouses, currency, performance measurement Key Findings ▪ The author examines the mechanisms now available to tokenize real asset ownership. ▪ The author presents new survey-based evidence of real estate tokenization deals. ▪ The author concludes that an intermediate structure is likely to be both necessary and convenient when fractionalizing a single asset. For that reason, funds are more natural targets for tokenization.

As the High Net worth (HNI) Investors mount in the financial markets with great financial power, their footprint is clearly directing the Retail Investors. During the last decade Indian HNI Investor’s exposure to the Mutual Funds and Primary Equity Market is not just substantial but also provides an early base to potential and stable capital Markets. Growth and sustainability of capital markets depend on wider participation of Retail Investors. The study concludes that Retail Investors are investing under the influence of HNI Investors Investments and the interaction of HNI and Institutional Investors is impacting them in a positive manner. There is a clear statistical evidence of HNI Investors influence on the investments of Retail Investors either in the primary market or the secondary market. Index Terms: HNI Investors, Proprietary Trading, Assets under Management, IPO Subscription

This study aims to analyze determinants which might influenced yield of Indonesian Government Bond Denominated-Rupiah in primary market. We divide the determinant by three factors (i.e intrinsic factor, extrinsic domestic factor and extrinsic globar factor). Multiple regression using to analyze colinearity among variables in this study. The results showed that bond maturity, bond coupon rate, bond price in secondary market, bond performance in market, inflation rate, currency, money and stock domestic market condition, and money and bond global market condition are significantly affected Indonesian government bond yield in primary market.

Debt securities auction is the kind of trading the most often used in a crisis. The market of bonds, government debt, and debt of private structures are the objects of empiric, scientific and applied researches. The goal of the current scientific work is to identify the peculiarities of auction trade and the state debt policy in a crisis situation basing on the foreign and domestic experience, to investigate the choice of formats of debt securities auction at the secondary market of securities and management of the factors for elimination of the distortion of such kind of trading at financial markets, contributing to the economic growth. The work specifies that in the institutional environment of development of the securities secondary market, where investment organizations and banks, including foreign ones, are the potential buyers of debt securities, the modern practice of auctions and new formats of their holding are determined by the new rules of trade, increasing importance of the private value of lots and informational support for the auction. At the stage of the economy digitalization and formalization of interrelated processes and transactions at the financial markets, it is necessary to develop an adequate mechanism of auction trade. It is confirmed that the mechanism of improvement of the auction practice and large-scale implementation of the new formats of their holding are inefficient with no agreement of the interests of investors, emitters, and different interested parties to eliminate the distortion of the debt securities auction at the financial markets. The research has determined significant deviations in the rates of the GDP growth and government debts, particularly in Poland, Japan and Ukraine that is explained by the level of confidence in the state and specialized institutions of debt management, target long-term economic strategy and monetary policy in the crisis conditions, particularly in the EU countries and in Ukraine. The authors of the article identify directions of the further scientific and applied researches to improve flexibility of the system of debt securities auctions amid the crisis and intensify their positive impact on the economic growth. Keywords: auction, economic crisis, debt securities, government debt, secondary market, investor, financial market, economic growth. JEL Classification E44 Formulas: 0; fig.: 5; tabl.: 0; bibl.: 28.

This study provides evidence on the role of public firms’ financial reports in the state‐bond secondary market. I investigate the informational role of corporate earnings announcements and find that public firms’ monthly earnings signals aggregated to the state level are positively associated with contemporaneous state‐bond returns. Further analyses reveal that public firms’ earnings announcements predict traditional economic indicators and contain incremental information that is independent of the traditional economic indicators. In cross‐sectional analyses, I show that the earnings–returns relation is especially pronounced when bondholders face longer investment horizons and higher credit risks. Taken together, the evidence indicates a positive externality of corporate financial reports in alleviating the opacity in the municipal bond secondary market.

We develop a theoretical model that predicts that credit unions will offer relatively less risky loans (e.g., fewer “subprime” mortgages) compared to similar commercial banks due to credit unions’ focus on member utility as nonprofit financial cooperatives. The model also predicts that banks will increase subprime lending more than credit unions during economic expansions and decrease subprime lending more than credit unions during recessions. We use the financial crisis and Great Recession period of 2007–2009 to test our model and find that, as predicted, commercial banks engaged in approximately five times more subprime lending relative to credit unions during the period leading up to the financial crisis (2003–2006). Banks also had delinquency and charge-off rates that were two to three times higher during and immediately following the crisis. We also find that banks were about two-and-a-half times more likely to fail and were significantly more likely to receive TARP government assistance funds. The results are robust to controlling for important differences between credit unions and banks besides structure and incentives, including asset size, portfolio concentration, market share, earnings, liquidity, leverage, mortgages sold to the secondary market, core deposits, and state-level indicators of economic performance and housing prices. We argue that the findings explain why credit unions often appear more risk averse relative to commercial banks, and hold important implications for researchers, policymakers and regulators.

Context Stratified cattle production (SCP) systems, which involve buying lean animals from pastoral areas and fattening them in locations that have better production conditions, are re-emerging in Kenya’s drylands. Aims This study investigated how pastoralists in the drylands of Kenya endeavour to fulfil cattle marketing requirements under the SCP systems. Methods Purposefully identified cattle fattening entrepreneurs in Tana River (n = 10) and Narok (n = 12) counties were interviewed on the requirements they demand in buying animals from pastoralists. Using the information generated from the entrepreneurs, pastoralists (Tana River, n = 10; Narok, n = 12) were interviewed on how they respond to the entrepreneurs’ requirements and make sales. The information was triangulated with a focus group discussion in each county whose members were knowledgeable traders and pastoralists. Using a semi-structured questionnaire, randomly selected pastoral households (Tana River, n = 86; Narok, n = 69) were interviewed on cattle sales made through SCP systems. Key results The results showed that under the SCP systems, pastoralists in the two counties were required to sell cattle of particular qualities, comply with unpredictable supply orders, sell in secondary markets or near urban centres, use sale agents and undertake high commercial off-take rates if the demand arose. To meet these requirements, the pastoralists devised several strategies and practices, including changes in the animal husbandry practices, keeping ‘emergency’ animals in the home-based herds to comply with unpredictable demands, arrangements with market intermediaries to sell in secondary markets and building buyer–seller trust to facilitate sales through agents. In adopting these practices, pastoralists in both counties managed to sell approximately one or two animals per household through the SCP systems over a period of 12 months, which accounted for ~28% of the annual commercial cattle off-take from the households. Conclusion Pastoralists change their management practices in response to livestock marketing requirements and challenges, enhancing their integration into the market economy. Implication The information could guide stakeholders to formulate strategies for improving pastoralists’ involvement in cattle marketing through SCP systems.

Initial Public Offering (IPO) is a company activity in order to sale its shares to public with the purpose to increasing company capital, and aimed to have an impact on company’s prospect improvement that occur due to expansion with those added capitals. Underpricing is a phenomenon where the price of shares offered in the primary market has a lower price then the price of shares in the secondary market. The aim of this study is to investigate whether there is an impact on auditor's reputation, underwriter's reputation, and Return on assets (ROA) on the underpricing of shares in companies performing IPO on the Indonesian Stock Exchange from 2016-2018. The result of this research shows that auditor's reputation, underwriter's reputation, and the return on assets has a significant impact on the underpricing level.

This paper studies the equilibrium dynamics arising in consumer durable goods markets in response to aggregate credit supply shocks. To this end, we develop a general-equilibrium model of durable consumption with heterogeneous households facing idiosyncratic income risk and borrowing constraints. Two novel features of our framework are that: 1) used durable goods trade on secondary markets at market-clearing prices; and 2) households endogenously choose when to scrap them. The model successfully matches several empirical patterns of U.S. car markets around the Great Recession that we document using a rich dataset on the prices of new and used vehicles as well as CEX data on households' vehicle replacement activity. After a negative credit shock (i.e., a tightening of the borrowing limit), debt-constrained households postpone the decision to scrap and upgrade their cars. The economy experiences a period of low resale prices for used cars, which reduces wealthy households' incentives to replace their cars, thereby decreasing new-car sales. We also use our framework to study the effects of aggregate income shocks, the role of cars as collateral, and to evaluate targeted fiscal stimulus policies such as the Car Allowance Rebate System in 2009 (``Cash for clunkers'').

Imperfect production processes are frequently investigated in supply chain literature. Many recent articles assume that items that do not meet the quality requirements can be sold on a secondary market at a reduced price. Due to simplification, these papers ignore the demand of the secondary customers and assume instead that all imperfect quality items are salable. In this paper, we show that this ignorance can lead to unrealistic results as an unrestricted secondary market may reduce the manufacturer’s incentive for an error-free production process. By introducing a price- and quality-dependent demand for both the primary and secondary markets, we obtain the following main insights: (i) a restricted secondary market leads to more realistic results compared with the unrestricted case; the secondary demand is only ignorable under certain conditions; (ii) quality decisions are mainly influenced by the market parameters of both market segments as well as quality cost parameters; (iii) in some cases, it is advantageous not to serve the secondary market and to concentrate the sales process on primary customers.

In the article based on the results of comparative analysis of the dynamism of the securities market of Ukraine and its key component – the stock market, the trends are clarified and the directions of its further development are determined. The role of the stock market in the development of the country’s economy from the standpoint of its impact on various areas of activity and functional purpose is emphasized. According to the results of critical analysis of scientific works of modern economists and financiers in the field of studying the problems of stock markets functioning, the range of issues that deserve priority attention from the standpoint of identifying the problematic nature of their development and intensification of exchange activities are specified. The reasons for the downward dynamics and stagnation of development of the securities market of Ukraine from the standpoint of the international online platform Trading Economics in the period 2010-2020 are revealed. The tendencies of change of volumes of exchange trade in the securities market of Ukraine in comparison with dynamics of GDP by calculation of a partial indicator of influence on its dynamics in the period of 2015-2020 are defined. The presented comparative data on the volume of exchange and over-the-counter trade in the securities market of Ukraine revealed a tendency to change the focus of trade from the over-the-counter market to organized securities markets. It is established that the modern stock market of securities of Ukraine tends to a polycentric model, which is based on FB “Perspective” and FB “PFTS”, which in the study period accounted for 91.94-99.67% of exchange turnover, which indicates the processes of consolidation of securities trade in such a market. Analysis of the situation on the stock market of securities of Ukraine during the spread of COVID-19 (January-September 2020) revealed that in the study period compared to the same period in 2019, trading volumes increased by 3.14%, and this indicates a lack of pandemy impact on the dynamics of exchange trade in stock values. At the same time, the reason for such changes can be considered a significant previous decline in the domestic stock market and its gradual recovery, which would have had a faster growth rate, if not for the impact of the spread of COVID-19. It should also be noted the low activity of stockbrokers in the primary securities market, and relatively high in the secondary market, where Domestic government bonds were the most frequently traded, and trading was widespread in the spot market. Exit from the state of stagnation is possible if the National Commission on Securities and Stock Market adheres to the Strategy for the Development of the Financial Sector of Ukraine until 2025, the global financial market will be free of shocks similar to February-March 2020, there will be consolidated development of financial investment, organizational, legal and socially significant support of the country’s exchange activities.

Manufacturers are increasingly interested in the design of hybrid manufacturing/remanufacturing systems in terms of environmental protection and the desire to enhance profits. Furthermore, they hav...

This paper examines whether a premium for green bonds, called “greenium”, found in previous studies, exists in primary and secondary bond markets. Using a universe of about 2000 green and 180,000 non-green bonds from 650 international issuers, we apply both propensity score matching and coarsened exact matching to determine a sample of conventional bonds that is most similar to the sample of green bonds. We find that green bonds have larger issue sizes and lower rated issuers, on average, compared to conventional bonds. The estimates show that the yield for green bonds is, on average, 15–20 basis points lower than that of conventional bonds, both on primary and secondary markets, thus a “greenium” exists.

We study prices paid at auction for artworks created by male and female artists, based on birth-identified sex, and how these prices have evolved over time. Artworks produced by female artists comprise less than 4% of art auction sales; after controlling for artwork characteristics, we find that artworks by female artists are 4.4% more expensive than artworks by male artists. In the top echelon of the art market—for sales above $1 million—artworks by male artists sell for 18.4% more than by female artists. The top 40 artists represent 40% of total market share; no female artist makes the top 40 ranking of artists in terms of total sales value at auction in the period under study, 2000–2017. However, for contemporary artists, our empirical results show that works by male artists sell for 8.3% more than their female counterparts. Overall, this study highlights significant price differences across birth-identified sex in the secondary market for fine art.

Banks and insurers as part of financial service industry engage in partnership under the concept of Bancassurance. Several studies are done on this topic, focusing on economies of scale and performance of most Bancassurance common models. The purpose of this study is to identify the key market environment factors that influence the development of Bancassurance for retail banks in Latvia and the level of increase. Aim of this research is to analyse – how market environment factors influence the development of Bancassurance in Latvia. The current paper is focused on the Latvian market where several Bancassurance models are present as we test our propositions by interviewing management representatives of major stakeholders and analysing secondary market data. Main research findings – motives of banks and insurance companies in Latvia for implementing Bancassurance are in correspondence with the academia: new clients and additional revenue for insurers, improvements of customer service and loyalty for banks. Study results highlight the great impact of economic growth and technological development on Bancassurance over other market-based factors and reflect the importance of their integration for achieving better results in each model. KEYWORDS: bancassurance, banks, insurance, market environment. JEL CODES: M10; M38 DOI: http://dx.doi.org/10.15181/rfds.v28i2.1943

We develop a conceptual framework to model the seasonality in the probability of catastrophe bonds being triggered. This seasonality causes strong seasonal fluctuations in spreads. For example, the spread on a hurricane bond is highest at the start of the hurricane season and declines as time goes by without a hurricane. The spread is lowest at the end of the hurricane season assuming the bond was not triggered, and then gradually increases as the next hurricane season approaches. The model also implies that the magnitude of the seasonality effect increases with the expected loss and the approaching maturity of the bond. The model is supported by an empirical analysis that indicates that up to 47% of market fluctuations in the yield spreads on single-peril hurricane bonds can be explained by seasonality. In addition, we provide a method to obtain market-implied distributions of arrival frequencies from secondary market spreads.

The aim of the article is to present selected research directions and results of studies on the market for passenger cars (with an emphasis on its geographical dimension). The focus has been on four main groups of issues: (1) car ownership and car-demand modelling, (2) the relationship between the primary and secondary car market in emergingeconomies, (3) the role of spatial factors and public transport in the functioning of the car market and (4) the environmental impact of automotive expansion and ways of coping with that, such as electromobility and the sharing economy. Studies on car ownership and the demand for cars both confirm that volumes and rates of growth depend primarily on economic factors (GDP, personal incomes, car prices and prices of complementary goods). They also describe spatial and temporal differences in the so-called first automobile revolution (the spread of cars as a mode of transport). The next group of studies on the car market deals with the relationship between the primary and secondary markets in emerging economies (including Poland), in which car ownership has entered on to a path of rapid growth in recent years. The development of the market for passenger cars is also influenced significantly by such spatial factors as urbanisation, population density, the built environment and distance to city centres as well as the accessibility and operation of public transport. These issues, very important from a geographical point of view, are discussed in a subsequent part of the article, prior to current findings on the environmental impact of automobiles being described, in particular as regards the role of various fuels (especially gasoline-petrol and diesel) in generating emissions of harmful substances. The paper then ends with a brief discussion on electric and hybrid cars as well as the sharing economy. In the literature, the above-mentioned topics are found to be related to the so-called second automobile revolution, and are thus of key importance to the debate on the contemporary car market and changes therein. This interdisciplinary debate is seen to be worthy of an involvement on the part of geographers that is broader than hitherto.

This study introduces search frictions into a variant of overlapping generations environments, as in Smith (2002). In the model, this study compares financial intermediation to trading shares in decentralized secondary markets. The results show that under certain conditions, both financial mechanisms generate the same equilibrium outcome.

Funding Information: The authors declare the following financial interests/personal relationships which may be considered as potential competing interests: Anna Lukkarinen reports financial support was provided by the Finnish Foundation for Share Promotion in form of a research grant.The authors wish to thank Guillaume Andrieu, Daniel Blaseg, Helen Bollaert, Alexander Groh, Lars Hornuf, Thomas Lambert, Benjamin Le Pendeven, Florencio Lopez-de-Silanes, Jukka Luoma, Markku Maula, Moritz Renner, and Mikko Rönkkö; the conference and seminar participants of the 3rd Toronto Fintech Conference (Ivey Business School, Toronto), the 4th European Alternative Finance Research Conference (European Center for Alternative Finance at Utrecht University), the Cryptocurrency Research Conference (ICMA Center at the University of Reading), and the MaCCI Conference on “Competition and the Regulation of Financial Innovation” (ZEW Mannheim); Audencia Business School, SKEMA Business School, and Aalto University; and Editor Martin Kenney and the three anonymous reviewers for their helpful comments and suggestions. Anna Lukkarinen gratefully acknowledges financial support from the Finnish Foundation for Share Promotion (Pörssisäätiö). While the prevalence of equity crowdfunding has increased, investors have had very few opportunities to exit such investments. Thus, several equity crowdfunding platforms have started considering the development of secondary markets for buying and selling shares. Using detailed data from the world's first secondary market for equity crowdfunding, we investigate whether plans to list on the secondary market increase investor participation and thus the amount of money entrepreneurs raise during their equity crowdfunding campaigns. We find that in the early days of the secondary market, communicating a listing plan attracted more investors and larger investment sums. However, these effects largely disappeared after the first two years of secondary market operation. We interpret this to stem from investors' recognition of the insufficient liquidity of the secondary market and thus its probable inability to constitute a viable exit route. We also find that ex post, many entrepreneurs forgo listing, especially if their campaigns are not sufficiently successful, which implies significant costs associated with a listing. Our findings offer valuable insights to platforms aiming at launching secondary markets and regulators responsible for validating relevant initiatives. Specifically, we highlight how participation in equity ownership can be increased through well-functioning secondary markets, which however are difficult to achieve within equity crowdfunding.

The aim of this paper is to explore how debt contracts are affected by investment in asset specialization and by the dynamics of the secondary market for collateralized productive assets. Before applying for a loan, financially constrained firms face a specificity trade-off: asset specialization increases firms’ project returns, but decreases the liquidation value of assets in the secondary market if the firm is in financial distress. To study this trade-off, the paper uses a theoretical model in which the choice of asset specificity and the outcome of the secondary market for distressed firms’ assets are endogenous. High redeployability costs and a small number of participants in the secondary market are associated to low recovery values and to a high cost of debt. The paper shows the conditions under which financial constraints reduce firms’ incentive to invest in asset specificity.

Background: Technology experts foresee that nanotechnology is the next industrial revolution and it has great potential to bring solutions to many challenges of global relevance in terms of a diverse range of applications. Efficiency-driven economies are transforming into innovation-driven economies where Intellectual Property (IP) plays a pivotal role in achieving a competitive advantage. Whereas industry analysts assert that IP roadblocks will be a severe detriment to the development of nanotechnology due to infringements and high-profile patent battles. Various authors have made a significant effort to analyse the implications of IP on nanotechnology but most of the published literature covers only the years 2000- 2010. Data and insights pertaining to recent developments are lagging behind. Therefore, the objective of this review was to explore cutting-edge empirical evidence towards emerging trends of Intellectual Property protection in nanotechnology, thereby to provide insights aimed at unleashing the full potential of nanotechnology innovation for socio-economic advantage. Materials and Methods: Patent information over the period 2000 to 2018 was collated and analysed to determine the latest trends. To gain a global perspective, nanotechnology patents issued by the United States Patent and Trademark Office (USPTO) and nanotechnology patents published in the ‘PatentScope’ of the World Intellectual Property Organization (WIPO) were surveyed along with literature in relation to nanotechnology commercialization and litigation. Results: Our study revealed that worldwide protection of Intellectual Property in nanotechnology has steadily been increasing year-on-year accounting 3.3 million patent applications filed in 2018 in which China and U.S. are dominating. The other main contributors are Japan, Germany Republic of Korea, France and U.K. Asia has emerged as the single region to file more than half of total filings for the first time thus shifting global IP landscape from Europe to Asia. Another notable finding is that there is a significant growth in trademark registration in many of the leading economies. Top five technology fields with high international patenting activity are computer technology, medical technology, digital communication, electrical machinery and pharmaceuticals where computer technology is dominating. More than 90% of the total patents are granted on materials, devices and processes developed as basic building blocks of nanotechnology at laboratory level which sound as more downstream innovations in the short-term. Amid the upward trends in nanotechnology patenting, newly emerging obstacles pose risks to innovation. A key finding of the present study is that the increasing trend of patent litigation almost follows the same path of patent grants indicating a positive correlation. A global prominence of middle-income and low-income countries in patent filing is yet to emerge which foreshadows an IP divide. Discussion: A secondary market for patent assets is pronounced with many new types of players leading to a high cost of patenting nanotechnology. These trends foreshadow a surge of patent filings in the years to come and the patent offices will be confronted with that ‘surge’ of patent applications of increased complexity and multidisciplinary nature.Patent offices with inadequate efficacy will ultimately produce lowquality patents along with a difficulty to enter into markets and will facilitate exploiting of the IP legal systems to extract rewards for infringement without contributing to innovation or social prosperity of nations. Conclusion: Insights and recommendations given in this paper will enable nanotechnology researchers, inventors, technopreneurs and investors to understand recent trends and global perspectives on implications of IP in nanotechnology and intensifying IP battle thereby to contemplate and succeed in their roadmaps towards leveraging on nanotechnology.

Bangladesh is one of the major rice producing countries in the world; rice is the major crop of this highly populated agrarian country and this sector is by far the most important provider of rural employment. The study was designed to examinethe marketing system with selling pattern of paddy in selected areas of Netrakona district which is one of the important paddy producing areas of Bangladesh. Samples were purposively selected in order to meet the objectives. The total sample size was 45 respondents including 20 paddy farmers, 7 Faria, 5 Bepari, 5 Paiker and 8 Aratdar-cum- wholesaler. Primary data were collected through face to face interview with the farmers and intermediaries by the researcher himself during the month of November, 2013. The marketed surplus of all types of farms represents 72.07 percent of total quantity of paddy produced in this study area. Marketing functions performed by the farmers in the study area were selling of paddy, transportation, storage, grading, financing and market information. The marketing functions performed by the intermediaries were buying and selling of paddy, transportation, storage, processing, grading, financing, pricing, market information and risk bearing. Farmers and intermediaries transported their paddy to the market for sale by head/shoulder load, rickshaw, van, trolley, push cart, bi-cycle etc. In this study the researcher had found 10 marketing channels of paddy in the study area. In describing selling pattern of boro paddy, the study showed that the small farmers sold 64.17 percent of paddy and the medium and large farmers sold 70.37 and 75.00 percent of paddy, respectively. The small farmers recorded the highest number of sale (7) and the quantity offered per sale was the lowest i.e. 8.25 quintal. The number of sale for the large farms was the lowest (4) but the quantity sold per sale was the highest (53.57 quintal). The small, medium and large farmers sold 74, 39 and 25 percent of their total sale at the farm-gate and 26, 61 and 75 percent in the primary and secondary markets, respectively. Progressive Agriculture 31 (2): 104-118, 2020

This article demonstrates that a secondary market for U.S. variable annuity policies may be immediately welfare enhancing to all parties involved: the insurer, the original policyholder, and a thir...

This paper finds that window dressing, bypass opportunities, market sentiment and index adjustments drive seasonal bond market liquidity effects. It uses a unique data set that combines a number of recurring event types. After controlling for other seasonal factors, liquidity is lower prior to quarter ends, which is attributed to market makers’ window dressing. Seasonal liquidity effects are smaller in case investors can bypass secondary market venues, and market sentiment influences both the direction and the size of most seasonal effects. Additions to an index spur the liquidity of the bond included, and index adjustments are also important for the liquidity of other bonds, that have been issued by the same institution. These results give important advice for the trading of market participants, they explain why the primary market is essential for secondary venues and why too much regulation can be detrimental to market capacity.

In the timber industry complex of Russia, medium-sized and small enterprises with a volume of timber harvesting up to 100 thousand cubic meters per year occupy a share of 48 % in the total volume. Most of these enterprises do not have the capacity to purchase new harvesters. An alternative to the new harvesters are the harvesters from the secondary market. Thus the study of changes in the technical condition of harvesters during their operation is an actual study for Russia. The data on the models, age, number of hours worked and the cost of harvesters that are offered on the secondary market was collected. 202 commercial offers were collected. In total there are 31 harvesters under 5 years of operation; 99 harvesters from 5 to 10 years of operation; 56 - from 10 to 15 years of operation; and 16 - older than 15 years of operation. There are 73 John Deere harvesters (including the outdated Timberjack models), with 8 tracked vehicles, 29 Ponsse harvesters; 49 Komatsu harvesters (including the outdated Valmet models) with 4 harvesters based on a tracked excavator; 37 harvesters of different models made on the basis of tracked excavators and 18 harvesters of other models. Hypothetically assuming that there is a connection between the price of the harvester and its condition, correlations were analyzed between the price and the age of the harvester and between the price and the number of worked hours of the harvester. The relationship between the price and the age is described by power and exponential curves, with coefficients of determination of 0,56 and 0.54, respectively. Filtering data by power range (160-205 kW) and by model (three models were considered: John Deere 1270; Ponsse Ergo; Komatsu 931) did not lead to clear certainty about the form of regression, although it slightly increased the coefficient of determination. There are groups of factors that can influence the type of regression: the seller's factor, the repair factor, the operation factor, and the technical characteristics factor, but determining the degree of influence of these groups requires additional research. The dependence between the price and the number of worked hours is characterized by a very weak relation due to a large spread of data owing to incorrect values of the hours marked by sellers. General regression trends for harvesters are consistent with data for other types of tractors. But to determine unambiguity in regressions requires the accumulation of empirical data on the reliability of machinery and changes in their price over a number of years.

We show that during the 2020 Covid-19 crisis: (a) Bond ETFs acted as vehicles of price discovery, and with prices often close to their intrinsic values, despite deviations from Net Asset Value (NAV) that at times were large; (b) Bond ETFs allowed investors to rapidly and efficiently manage exposure and risk at low costs; and (c) Contrary to some academic theories, there is no evidence of “wrong way” arbitrage. TOPICS:Exchange-traded funds and applications, exchanges/markets/clearinghouses, volatility measures, financial crises and financial market history, performance measurement Key Findings • During the 2020 Covid-19 crisis, bond ETFs acted as vehicles of price discovery, and with prices often close to their intrinsic values, despite deviations from Net Asset Value (NAV) that at times were large. • Bond ETFs allowed investors to trade in the secondary market, and to rapidly and efficiently manage exposure and risk at low costs. • The primary market where ETF shares are created and redeemed also functioned smoothly, with no evidence that the arbitrage activities of authorized participants were destabilizing.

After the Getback SA scam, a special Bond Issuers’ Register (RZE) was created to strengthen market supervision, which makes it easier for investors to search for information on debt securities. Thanks to this register, we can finally learn about the actual size and several important features of the Polish non-Treasury debt securities market. The first objective of the article is to show significant changes in the law concerning the form of registration of bonds and their potential impact on further market development. The second goal is to show the previously unknown scale and main features of the bond market, including in particular municipal bonds.The first hypothesis is that the obligatory registration of bonds in KDPW together with the publicly available Bond Issuers' Register (RZE) have improved the transparency and security level of the Polish non-treasury bond market and facilitated trading in these securities on the secondary market. The second hypothesis is that the Bond Issuers’ Register is the first publicly available tool for a comprehensive analysis of the Polish non-treasury bond market, which revealed, among other things, the high fragmentation of issuers (especially in local government bonds), the dominance of state-controlled issuers, the predominance of floating rate bonds and a significant size of the bond market registered outside KDPW. Po aferze Getback SA, w celu wzmocnienia nadzoru nad rynkiem obligacji, stworzono specjalny Rejestr Zobowiązań Emitentów (RZE), który ułatwia inwestorom wyszukiwanie informacji na temat papierów dłużnych. Rejestr ten po raz pierwszy ujawnił rzeczywisty rozmiar oraz kilka ważnych cech polskiego rynku obligacji nieskarbowych. Pierwszym celem artykułu jest pokazanie istotnych zmian prawa dotyczących rejestracji obligacji oraz ich potencjalnego wpływu na dalszy rozwój rynku. Drugim celem jest ukazanie nieznanej dotąd skali i głównych cechy rynku obligacji, w tym w szczególności obligacji komunalnych.Pierwsza hipoteza brzmi: obowiązkowa rejestracja obligacji w KDPW wraz z publicznie dostępnym Rejestrem Zobowiązań Emitentów poprawiły przejrzystość i poziom bezpieczeństwa polskiego rynku obligacji nieskarbowych oraz ułatwiły obrót tymi papierami na rynku wtórnym. Druga hipoteza brzmi: Rejestr Zobowiązań Emitentów jest pierwszym publicznie dostępnym narzędziem do kompleksowej analizy polskiego rynku obligacji nieskarbowych, który ujawnił m.in. duże rozdrobnienie emitentów (w szczególności w obligacjach samorządowych), dominację emitentów kontrolowanych przez Skarb Państwa, przewagę obligacji o zmiennym oprocentowaniu oraz znaczącą liczbę obligacji zarejestrowanych poza KDPW.

The solution of the housing problem for many decades has been and remains one of the most important tasks facing the nation.. The problem of modeling the value of residential properties is becoming more and more urgent, since a high-quality forecast makes it possible to reduce risks, both for government bodies and for realtors specializing in the purchase and sale of residential properties, as well as for ordinary citizens who buy or sell apartments. Predictive models allow us to get an adequate assessment of both the current and future situation on the residential property market, to identify trends in the cost of housing and the factors influencing these changes. This involves both the qualitative characteristics of the particular property, and the general condition and the dynamics of the real estate market. Russia is characterized by significant differences in the level of development of regions, therefore, by differences in trends of supply and demand prices for real estate. Valuation of residential properties at the regional level is particularly important, since all of the above determines the social and economic importance of this problem. This article presents a comprehensive model for estimating the value of residential properties in the secondary housing market of Moscow using decision tree methods and ordinal logistic regression. A predictive model of the level of housing comfort was built using the CRT decision tree method. The results of this forecast are used as input information for an ordinal logistic regression model for estimating the value of residential properties in the secondary market of Moscow. Testing the model on real data showed the high predictive ability of the model we generated.