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The article presents a paper on the geopolitical issues that China have to address in order to advance its energy interests and energy security in Central Asia. Topics include China's strategic use of rare earth elements as a resource diplomacy and Beijing's use of its massive cash reserves to purchase energy assets to integrate into the Greater Central Asian region. The author believes that China has created an atmosphere of doubt and global insecurity.

This article looks at the empirical consequences of introducing endogenous capital depreciation in the standard neoclassical model with quadratic adjustment costs. To this end, we formulate an empirical specification that accommodates capital maintenance and utilization in the Euler equations for aggregate investment. The empirical estimates with data from the Canadian Survey on Capital and Repair Expenditures show that, in contrast to the existing literature, the performance of the Euler equations is improved when we account for the impact of variable capital depreciation. [ABSTRACT FROM AUTHOR]

This paper investigates the difference between two widely used measures of accruals and their differential impact on accrual strategy returns. The two measures are accruals computed using consecutive changes in the balance sheet items and accruals computed as earnings minus cash flows from operating activities, both from the cash flow statement. Our investigations reveal that the difference between the two measures is caused by four items and non-articulations in changes in working capital accounts and depreciation expenses, in addition to non-articulation events as identified by Hribar and Collins (2002). We find that the non-articulation in working capital accounts and depreciation expenses between the cash flow statement and other financial statements is surprisingly prevalent and economically significant, and it can be attributed to special events, errors made by Compustat, firms' inconsistent definitions, and nonstandard classifications of assets/liabilities. We show that, after excluding non-articulation events, the accrual strategy returns are higher for accruals computed using balance sheet items than accruals computed using cash flow statement items. Further investigations suggest that the return differentials are mainly due to other funds from operations and the non-articulation in changes in accounts receivable. [ABSTRACT FROM AUTHOR]

In this article, we adopt a nonlinear approach to examine the dynamics of the international reserves holdings by the emerging economies. To do so, we estimate the demand for international reserves with a Panel Smooth Transition Regression (PSTR) model that loosens two restricting hypotheses, homogeneity and time-stability. We find evidence for the presence of a nonlinear behaviour in the demand for international reserves, a result that is new to the literature. The coefficients are found to change smoothly, as a function of two threshold variables - out of five candidates tested in total. Our specification accounts for the acceleration of foreign exchange reserves accumulation that the linear specifications fail to explain. [ABSTRACT FROM AUTHOR]

First generation crisis models suggest that the size of international reserves affects only the timing of a crisis while second generation models imply that higher reserves can reduce the probability of a crisis. First in the literature, this article suggests the 'rolling probit model' to successfully demonstrate that high reserves can be effective in offsetting vulnerable fundamentals in a vulnerable zone. The more vulnerable fundamentals in the vulnerable zone require higher levels of international reserves to reduce the probability of a crisis. If the fundamentals are sufficiently bad, the level of needed reserves may be explosive, which makes a crisis unavoidable. Unlike the arbitrary proposals of reserve adequacy measures in current literature, this article also sheds light on such measures based on the relationship between vulnerable fundamentals and high reserves. [ABSTRACT FROM AUTHOR]

Abstract: Energy companies can adjust the estimation of their reserves. We investigate how these revisions impact on the value of these firms. We analyze 100 revisions in seventeen countries for the period 2000-2010. We use an event study and find that the revisions of energy reserves significantly impact on the market value of the firm. We also discover an asymmetry in this response as the market’s reaction to downward revisions is much larger than that to upward revisions. Furthermore, the response to revisions in Australia, Canada, UK and US is smaller than that in the other 13 countries and the response is smaller in the years with turmoil on the energy markets. [Copyright &y& Elsevier]

Traditional models have encountered problems in explaining the accumulation of international reserves, particularly in Asia, in the period since the late 1990s. One suggestion has been that countries have sought to self-insure against future crises, either because of a perceived increase in the cost of crises or because of the perceived conditionality costs of using IMF credits. This paper offers an empirical investigation of these ideas, disaggregating across regions and across IMF facilities. We find that IMF programs have had a significant positive effect on subsequent reserve accumulation, allowing for other determinants, and that this effect endures over time. We also find that the effect differs between Latin America and Asia, and that it is not simply a phenomenon that is associated with the Asian crisis of 1997/98. The paper goes on to discuss the implications for the design of policy and for the reform of the IMF. [ABSTRACT FROM AUTHOR]

Technical reserves that are held by a general insurance company are the amounts set aside to meet its insurance liabilities. They are established to enable the company to meet and administer its contractual obligations to policyholders. Specifi c reserves are required to meet indemnity or other compensatory payments to policyholders together with the associated administrative costs. Also, contingent reserves might be held in order to provide a further buff er against adverse developments of claims and to smooth the emergence of profi t. It is important to note here, that the reserves of general insurance companies are usually not discounted providing a further safety margin. However, some regulatory regimes insist that reserves must be calculated on a discounted basis. [ABSTRACT FROM AUTHOR]

The global financial system appears to be heading for a new crisis, triggered in large part by growing and unsustainable levels of global debt. Reserve currencies are an essential element of the world's current financial infrastructure, and are widely recognized for their role in facilitating international transactions. History has taught us that such currencies are also quite transient, being subject to adjustments and changes as economic conditions evolve over time. The United States dollar now serves as the de facto world's reserve currency. However, this is unlikely to continue unchallenged and unchanged into the future. The G20 and the International Monetary Fund (IMF) appear to be now considering a reserve currency, such as the Special Drawing Rights (SDR), which is obtained through participation of many currencies. The major question is not what will become the new global reserve currency, but how this new currency will be managed. One of the critical issues associated with this currency management effort is that of determining the information systems architecture that will be required, including whether an associated Service Oriented Architecture (SOA) would be helpful in managing this new global currency. An extremely important element in this currency determination activity is a strong governance protocol that all the governments and sovereigns will accept and comply with. Otherwise any new global reserve currency, regardless of whether it is associated with a major information systems architecture foundation, will likely be unsustainable. In this paper, we examine these issues. [ABSTRACT FROM AUTHOR]

Cash maintained in nonprofit organizations is not a source of any interests and although the close to cash assesses together with credit lines available for enterprise are connected with resigning from realization of the part of incomes or costs, firms decide to maintain some liquidity reserves. And not only has this resulted from transactional needs, but also from precaution and speculative reasons. Investment in liquid reserves resulting from speculative demand for money may be assessed by usage of capital budgeting methods like: NPV or IRR or as a call option. In the article, each of these aspects of liquidity was taken into consideration and presented from nonprofit perspective. Nonprofit liquidity value determination may often significantly contribute to the solution of working capital management problems in these organizations. [ABSTRACT FROM AUTHOR]

A recent contribution to the literature argues that the present international monetary system operates like the Bretton-Woods system. Asia is the new periphery of the system and pursues an export-led development strategy based on undervalued exchange rates and accumulated foreign reserves. The USA remains the centre country, pursuing a monetary-policy strategy that does not take external factors into account in conducting monetary policy. We test this hypothesis and also present a new method for decomposition of a time series using a time-varying business coefficient technique that allows us to test the relationship between the cycle and macroeconomic policies under both regimes. [ABSTRACT FROM AUTHOR]

This article examines the dynamic growth of international reserves for the entire group of Latin American countries in an international comparative perspective and with respect to variables such as imports, current account balances, capital flows and gdp. We also present a review of the theories to analyze the causes, and a balance of benefits and maintenance costs. We have used the Wijnholds methodology to determine the necessary levels of international reserves for the period 2005-2008, considering the commitments of public and private external debt in the short term, and potential leakage of deposits from the local financial system. It is estimated that, for the last year, levels of excess reserves are equivalent to between US$ 170-200 billions. Also, the annual maintenance cost is equivalent to 0.8 per cent of gdp for all the countries surveyed. Finally, it outlines a set of proposals to take advantage of these circumstances. [ABSTRACT FROM AUTHOR]

We investigate how auctioneers set reserve prices in auctions. A well-established theoretical result, assuming risk neutrality of the seller, is that the optimal reserve price should not depend on the number of participating bidders. In a set of controlled laboratory experiments, we find that seller behavior often deviates from the theoretical benchmarks. We extend the existing theory to explore three alternative explanations for our results: risk aversion, anticipated regret, and probability weighting. After fitting our data to each of these models through parameter estimation techniques on both an aggregate and individual level, we find that all three models are consistent with some of the characteristics of our data, but that the regret model provides a slightly more favorable fit overall. [ABSTRACT FROM AUTHOR]

The formation, increase, release and reduction of technical reserves are accounting transactions that are only found in insurance companies. Technical reserves are established for each line of insurance as special funds so that the stability and solvency of insurance companies are not affected. [ABSTRACT FROM AUTHOR]

Not that long ago the treasury function was widely regarded as an overhead and little more. Since the end of 2007, and the onset of severe recession, that view of treasury has been altered. Many companies are now maintaining enormous reserves of capital and are becoming exceedingly conservative and anxious about lending, spending and investing. Uncertainty has brought the freewheeling days of the middle of the last decade to a grinding halt. In the process the position of treasurer has been elevated to a more enhanced role. In effect, treasurers are now chief liquidity officers - in practice and responsibility, if not in actual C-suite title and positioning. They now command a seat at the table, and not just as experts on issues of liquidity. Increasingly, treasurers sit as permanent members of audit committees and risk management committees - key hands-on participants in the overall financial management of the largest multinational companies. [ABSTRACT FROM AUTHOR]

The somewhat idiosyncratic accounting procedure of maintaining reserves to fund furniture, fittings and equipment (FF&E) capital expenditure in hotels mediated by a management contract is examined. Five research objectives have been pursued: (i) ascertaining contrasting motives of owners and operators with respect to FF&E reserve accounting; (ii) determining FF&E reserve accounting approaches adopted in hotels; (iii) determining the amount assigned to FF&E reserves in hotels; (iv) determining the sufficiency of FF&E reserves in hotels; and (v) appraising the degree of ease with which hotel operators can draw on FF&E reserve funds. These objectives have been pursued through the analysis of qualitative field data as well as survey data collected in Australia and New Zealand. The study's more significant findings include the determination that, consistent with the wishes of operators, maintaining cash funded FF&E reserves is the most popular approach (particularly in small hotels). It has also been found that FF&E reserves are 40 per cent underfunded. This deficiency beckons a question over whether hotel FF&E reserve accounting serves any meaningful role. [ABSTRACT FROM AUTHOR]

Copyright of Business Consultant / Poslovni Konsultant is the property of FINconsult Ltd. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Quantitative Easing consists of asset purchases by the central bank from both banks and non-banks with the help of reserve creation. While the operation could have a potential danger of inflationary pressure due to the money multiplier (banks create broad money from the reserves), the leverage is reduced due to the capital constraints of the banking sector. In this paper we explain how these capital constraints can be effective, hence curbing the inflationary impact of the Quantitative Easing measures. [ABSTRACT FROM AUTHOR]

Many scholars believe with the United States' increasing debt, the global position of the dollar is weakening. As the dollar declines, China, now the largest holder of U.S. dollars in the world, is understandably concerned. China's controversial peg to the U.S. dollar, combined with its $2.4 trillion in foreign reserves and trade imbalances, is debated daily by politicians and economists. This article presents arguments for and against the current China monetary policy in economic and political contexts. Statements from China's leaders, other global leaders, and economists are reviewed. Economic and political obstacles and incentives in the context of their influence on the China government are considered. Finally, milestones for business leaders to look for are suggested to help determine China's possible path to a fully convertible yuan. © 2010 Wiley Periodicals, Inc. [ABSTRACT FROM AUTHOR]

We use panel probit models with unobserved heterogeneity, state dependence and serially correlated errors in order to analyse the determinants and the dynamics of current account reversals for a panel of developing and emerging countries. The likelihood-based inference of these models requires high-dimensional integration for which we use efficient importance sampling. Our results suggest that current account balance, terms of trades, foreign reserves and concessional debt are important determinants of current account reversal. Furthermore, we find strong evidence for serial dependence in the occurrence of reversals. While the likelihood criterion suggest that state dependence and serially correlated errors are essentially observationally equivalent, measures of predictive performance provide support for the hypothesis that the serial dependence is mainly due to serially correlated country-specific shocks related to local political or macroeconomic events. [ABSTRACT FROM AUTHOR]

A prominent philosophical/legal case for requiring 100% bank reserves employs a flawed style of argument. It involves essentialism (criticized by Karl Popper and Joseph Schumpeter), persuasive definitions (identified by Charles L. Stevenson), faulty classification, and the piling up of irrelevant facts and considerations. [ABSTRACT FROM AUTHOR]

Countries hold foreign currency reserves to support and influence exchange rate. This paper examines the causal relationship between exchange rate and reserves in six Asian countries. We obtain divergent evidence regarding the long-run and stable relationship between reserves and exchange rate in the sample countries. There is evidence of bidirectional causality between reserves and exchange rate in India, while no-causality in Bangladesh. There is unidirectional causality from reserves to exchange rate in Pakistan, Sri Lanka and Thailand and unidirectional causality from exchange rate to reserves in Philippines. It is concluded that holding of reserves is necessary for supporting exchange rate and vice versa. [ABSTRACT FROM AUTHOR]

This article examines the interaction between the emerging and traditional powers in global governance reform, and asks whether we are heading towards an international financial system that is more fragmented, where power is more diffused and national and regional arrangements play a more prominent role, at the expense of global multilateral institutions. It begins with a brief discussion of the global systemic and country-specific factors that motivate Brazil, China and other emerging countries to accumulate large currency reserves. We find that national arrangements for managing financial and currency crises will continue to hold sway for emerging countries in the wake of the global crisis. However, the actual capacity of regional arrangements in managing future financial crises is uncertain, and the significance of regional alternatives in the emerging architecture should not be overstated. The real capacity of East Asian regional arrangements to manage financial crises, payments problems or currency attacks is still untested, and key thresholds in multilateralization still lie ahead. In South America, multilateral lender-of-last-resort support inside the region is largely confined to the sub-regional level and is limited by Brazil's reticence. Enduring reliance on bilateral measures for financial crisis management is noted. Where there has been progress in regional solutions, since the global crisis, has been in the role of regional development banks in providing financing for developing countries to enact counter-cyclical policies. Such support also provides insulation for states in the region against the contagion effects of international financial crisis. We are in the midst of transitioning to a more diverse and multi-tiered global financial and monetary system. A reformed IMF could have a role to play in addressing global imbalances and encouraging a shift from national reserves to collective insurance, however, it would be preconditioned by significant shifts in the policy, lending operations, and internal governance of the Fund, and willingness among the G20 to strike a new consensus on how to deal with imbalances, and new accommodation on acceptable reserve levels. [ABSTRACT FROM AUTHOR]

The Federal Reserve has recently activated its newly acquired powers to pay interest on reserves of depository institutions. The Fed maintains that its new policy increases economic efficiency and intends it to play a lead role in the exit from quantitative easing. This paper argues it is a bad policy that has a deflationary bias; is costly to taxpayers, and that cost will increase as normal conditions return; and establishes institutional lock-in that obstructs desirable changes to regulatory policy. The paper recommends repealing the Fed's power to pay interest on bank reserves. Second, the Fed should repeal regulation Q, which prohibits payment of interest on demand deposits. Third, the Fed should immediately implement an alternative system of asset-based reserve requirements (liquidity ratios) that will improve monetary control and can help exit quantitative easing at no cost to the public purse. Now is the optimal time for this change. [ABSTRACT FROM AUTHOR]

FIN No. 48, Accounting for Uncertainty in Income Taxes (FASB 2006), requires firms to disclose tax reserves and to record changes in tax reserves at adoption of FIN No. 48 as cumulative effect adjustments in stockholders' equity. We predict that between the enactment and adoption of FIN No. 48, relative to historical levels, firms settle disputes more often to potentially decrease visibility to the IRS and release reserves more often to reduce scrutiny and increase earnings (as opposed to retained earnings). We analyze 2005 and 2006 10-Qs and 10-Ks for the 100 largest nonfinancial, nonutility firms followed by analysts. Between enactment and adoption of FIN No. 48, relative to historical levels, firms report more settlements with tax authorities and release reserves more frequently. In addition, firms with higher IRS deficiencies are more likely to settle disputes. Between enactment and adoption of FIN No. 48, firms increased earnings by releasing $4.4 billion of tax reserves, nearly equaling the $4.5 billion released at adoption. [ABSTRACT FROM AUTHOR]

Copyright of Intellectual Economics is the property of Intellectual Economics / Mykolas Romeris University and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The article presents an economic overview of the reserves and the challenges for monetary policy in the U.S. in 2010. It discusses the reserves trends considering the reserves levels and the factors affecting it along with significant monetary policies conducted by the Federal Reserve Board. It states that the greater the level of excess reserves, the greater the banking system's rate of expanding along with a greater risk of the monetary policy to fall behind the curve.

Not properly accounting for differences between business owners and nonbusiness owners in studies of household wealth can lead to erroneous conclusions about the significance of different saving motives. Using data from the Panel Study of Income Dynamics from the 1980s and 1990s, we show that within samples of both business owners and non-business owners, the amount of precautionary savings with respect to labor income risk is modest and accounts for less than 10% of total household wealth. Previous large estimates of the size of precautionary balances resulted from pooling these two groups together. Such pooling is inappropriate given that business owners face higher labor risk and accumulate more wealth than non-business owners for reasons unrelated to precautionary motives. [ABSTRACT FROM AUTHOR]

The buildup of reserves in the US. banking system during the financial crisis has fueled concerns that the Federal Reserve's policies may have failed to stimulate the flow of credit in the economy: banks, it appears, are amassing funds rather than lending them out. However, a careful examination of the balance sheet effects of central bank actions shows that the high level of reserves is simply a by-product of the Fed's new lending facilities and asset purchase programs. The total quantity of reserves in the banking system reflects the scale of the Fed's policy initiatives, but conveys no information about the initiatives' effects on bank lending or on the economy more broadly. [ABSTRACT FROM AUTHOR]

Countries are showing interest in accumulating foreign reserves to ensure macroeconomic stability. There has been some debate whether to beef up the level of nations' foreign reserves or make it lower, especially in developing countries like Nigeria. Whereas some argue that the foreign reserve determines the country's rating in the global market, others hold opposing views. In this light, this paper examined the interactive influence of foreign reserve (FRS) on some macroeconomic variables such as: economic size (GDP); trade; level of capital inflows (KFL); exchange rate (EXR); and inflation. Analyzing secondary data from CBN statistical bulletins (1970–2007), the econometric results obtained from cointegration test, vector error correction (VEC) within the framework of autoregressive distributed lags (ARDL) revealed the following: (1) existence of a long-run relationship between the variables and two cointegrating equations; (2) possibility of convergence of the variables from the short run to the long run with slow speed of adjustment. It is thus the conclusion of this paper that accumulation of large foreign reserves is not very productive in Nigeria due to its inability to induce some of the macroeconomic variables. [ABSTRACT FROM AUTHOR]

This paper investigates empirically the relationship between the pattern of fiscal policy and the demand for international reserves in developing countries, and how this relationship is associated with political risk and conditional access to global capital markets. It finds evidence that for developing countries with low political risk, countercyclical (procyclical) fiscal policies are associated with higher (lower) international reserve holdings in economic downturns. The relationship is stronger when the countries with low political risk rely heavily on external financing. For developing countries with high political risk, the link between reserves holdings and fiscal policy pattern is not clear-cut. [ABSTRACT FROM AUTHOR]

This paper empirically investigates the importance of precautionary and mercantilist approaches to international reserves in the Indian context using monthly data from 1993:06 to 2007:03. The ARDL approach to cointegration is used to estimate as in the long-run relationship between reserves and its determinants. The empirical results show that the impact of the volatility of Foreign Institutional Investment which captures the precautionary motive, and that of undervalued real exchange rate which is associated with the mercantilist view on reserves are statistically significant in the long run. We conclude that both the precautionary and mercantilist motives explain reserve accumulation in India over the study period. [ABSTRACT FROM AUTHOR]

We modify the compound Poisson surplus model for an insurer by including liquid reserves and interest on the surplus. When the surplus of an insurer is below a fixed level, the surplus is kept as liquid reserves, which do not earn interest. When the surplus attains the level, the excess of the surplus over the level will receive interest at a constant rate. If the level goes to infinity, the modified model is reduced to the classical compound Poisson risk model. If the level is set to zero, the modified model becomes the compound Poisson risk model with interest. We study ruin probability and other quantities related to ruin in the modified compound Poisson surplus model by the Gerber–Shiu function and discuss the impact of interest and liquid reserves on the ruin probability, the deficit at ruin, and other ruin quantities. First, we derive a system of integro-differential equations for the Gerber–Shiu function. By solving the system of equations, we obtain the general solution for the Gerber–Shiu function. Then, we give the exact solutions for the Gerber–Shiu function when the initial surplus is equal to the liquid reserve level or equal to zero. These solutions are the key to the exact solution for the Gerber–Shiu function in general cases. As applications, we derive the exact solution for the zero discounted Gerber–Shiu function when claim sizes are exponentially distributed and the exact solution for the ruin probability when claim sizes have Erlang(2) distributions. Finally, we use numerical examples to illustrate the impact of interest and liquid reserves on the ruin probability. [ABSTRACT FROM AUTHOR]

Foreign reserve accumulation is a widespread phenomenon of recent years, particularly among emerging economies. Using a panel of 136 countries for the period 1973–2003, we demonstrate the need of using both a dynamic specification of the reserve demand equation and the system GMM estimator. These improvements change the results found by previous studies. Openness, regional imitation, persistence, an inverted U-shaped relationship between reserves and income level, and financial deregulation are the factors driving reserve hoardings. In contrast, reserves yield, and both trade and financial volatility are not statistically significant. Surprisingly, we find that countries with flexible exchange rate regimes have higher ratios of reserves to GDP. This result is robust to alternative exchange rate regime classifications. [ABSTRACT FROM AUTHOR]

This paper nests the buffer stock model within a standard open-economy model to capture two motives for international reserves accumulation—the insurance motive and the export-led growth motive. The model is solved for two exchange-rate policies, discretion and a rule with escape clause. It illustrates the behavior of international reserves and other macroeconomic variables when the policymaker pursues output and inflation stabilization and recognizes the supply of reserves can constrain the choice of exchange rate and the choice of exchange rate affects the supply of reserves. When output is below potential, it is optimal under both discretion and the rule to adopt a weak currency and promote export-led growth to achieve output and inflation stabilization. This policy leads to reserve accumulation and is consistent with the behavior of China. When reserves are low initially, welfare is higher when the policymaker follows a rule. [ABSTRACT FROM AUTHOR]

This paper investigates the changing pattern and efficacy of sterilization within emerging market countries as they liberalize markets and integrate with the world economy. We estimate the marginal propensity to sterilize foreign asset accumulation associated with net balance of payments inflows, across countries, and over time. We find that the extent of sterilization of foreign reserve inflows has risen in recent years to varying degrees in Asia as well as in Latin America, consistent with greater concerns about the potential inflationary impact of reserve inflows. We also find that sterilization depends on the composition of balance of payments inflows. [ABSTRACT FROM AUTHOR]

This paper brings forward the insurance aspect of holding reserves by using the conceptual equivalence between insurance and financial options, and explores when reserves are likely to become the primary means of precautionary arrangement, in particular in emerging markets. The sharp rise in the amount of reserves held by many emerging markets since the mid-1990s can be traced to the rise in the “globalization hazard” that confronts emerging markets. A modest probability of globalization hazard (sudden stop) can induce emerging markets to self-insure fully by hoarding international reserves, rather than relying on nonreserve alternatives of taking precautions. [ABSTRACT FROM AUTHOR]

Motivated by the observed international reserve hoarding behavior in the post-1997 crisis period, we explore the Mrs Machlup's Wardrobe hypothesis and the related keeping up with the Joneses argument. It is conceived that, in addition to psychological reasons, holding a relatively high level of international reserves reduces the vulnerability to speculative attacks and promotes growth. A stylized model is constructed to illustrate this type of hoarding behavior. The relevance of the keeping up with the Joneses effect is examined using a few plausible empirical specifications and data from 10 East Asian economies. Panel-based regression results are suggestive of the presence of the Joneses effect, especially in the post-1997 crisis period. [ABSTRACT FROM AUTHOR]

Not all brands will survive the economic downturn. The authors present two viable strategies for survival: The ‘Just Good Enough’ strategy allows brands to offer acceptable quality at a value price, while the ‘Altered Amortisation’ strategy attempts to position brands as a value when considered over an extended period of time. The authors demonstrate how to apply their framework and offer numerous examples of brands and industries that can take advantage of its strategic potential. [ABSTRACT FROM AUTHOR]

The article presents information on the exploration of the relationship between the United Arab Emirates (UAE) corporation specific characteristics and level corporate risk disclosure. It informs about the analysis of several corporate characteristics of the companies enlisted in Dubai Financial Market PJSC which includes its organization size, level of risk and reserves in the study along with the use of regression analysis for the results. It informs about the corporation size to be interrelated between political sensitivity and economies of scale.

In this paper, we consider an insurance company whose surplus (reserve) is modeled by a jump diffusion risk process. The insurance company can invest part of its surplus in n risky assets and purchase proportional reinsurance for claims. Our main goal is to find an optimal investment and proportional reinsurance policy which minimizes the ruin probability. We apply stochastic control theory to solve this problem. We obtain the closed form expression for the minimal ruin probability, optimal investment and proportional reinsurance policy. We find that the minimal ruin probability satisfies the Lundberg equality. We also investigate the effects of the diffusion volatility parameter, the market price of risk and the correlation coefficient on the minimal ruin probability, optimal investment and proportional reinsurance policy through numerical calculations. [ABSTRACT FROM AUTHOR]

Estimating the duration gap of a life insurer demands the knowledge on the durations of liabilities and assets. The literature analyzed the durations of assets extensively but rendered limited analyses on the durations of insurance liabilities. This article calculated the reserve durations for individual policies and estimated the duration of the aggregate reserves. The results showed that the duration of the policy reserve might be negative and/or have a large figure. They further revealed an interesting pattern of the reserve duration with respect to the policy's time to maturity. A term structure with abnormal durations, however, does not result in an abnormal duration of the aggregate reserves. [ABSTRACT FROM AUTHOR]

Copyright of Transformations in Business & Economics is the property of Vilnius University and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Starting May 2009, revaluation reverts unknown for taxation, in terms of tax the profit. This new tax rule shapes again the accounting behaviour. Thus, it is likely that most firms with revalued assets to choose for transfer from revaluation reserve from account 105 "Revaluation Reserves "into account 1065 "Reserves representing surplus achieved in the revaluation reserve" as damping assessed property depreciation, and not to remove it from book-keeping. [ABSTRACT FROM AUTHOR]

This paper uses QUEST III, a multi-region DSGE model, to study the macroeconomic effects of a gradual equalization of official foreign reserves between dollars and euros. We simulate a scenario of a shift in the composition of foreign reserves holdings from the present ratio of 65% dollars and 25% euros to equal 45% shares over a 10 years period. We assume imperfect substitutability between financial assets to allow this shift to have real effects. Our simulations point towards small real effects due to the reduction in real interest rates resulting from this shift in official holdings. [ABSTRACT FROM AUTHOR]

The article discusses the approach of the allowance reserve, an approach that balances cost and fix uncertainty on emissions, for cap-and-trade system. The authors relate the motivations that underlie their interest on the approach, such as its usefulness in nature and capacity to address on the problem of safety valve. Moreover, they look into the importance of the climate policy design and the design factors to consider, such as the policy for the raising of revenues and how they will be used.