scholarly journals Welfare Implications of Credit Rationing for Financial Consumers: An Empirical Investigation on the Case of the Korean Residential Mortgage Sector

2020 ◽  
Vol 5 (No. 1 Apr 2020) ◽  
pp. 13-24 ◽  
Author(s):  
Soojin Park ◽  
Man Cho
Keyword(s):  
Financial Stability ◽  
Choice Model ◽  
Credit Rationing ◽  
Borrowing Constraints ◽  
Mortgage Lending ◽  
Financial Inclusion ◽  
Policy Implications ◽  
Negative Effects ◽  
Household Level ◽  
Residential Mortgage

Credit rationing through borrowing constraints has long been an important research topic in the literature, in the context of managing financial risks (i.e., financial stability) as well as of expanding financial service to more marginal borrower segments (i.e., financial inclusion). This study empirically investigates the role of borrowing constraints in the residential mortgage lending sector in Korea, by utilizing a discrete tenure choice model to test the constraining effects of two particular lending restrictions on households’ home owning decisions - the wealth and income constraints as measured by the maximum loan-to-value (LTV) ratio and that of debt-to-income (DTI) ratio. Using the household-level micro data from Korea, we report that: the lending restrictions exhibit negative effects on the propensity to own; those constraining effects are also shown to increase for younger borrower cohorts; and, the magnitude of the effect of wealth constraint is larger than that of the income constraint, which is consistent with the findings from the prior studies. Using the empirical findings, we discuss policy implications of relevancy, in particular, as to how to balance between two often competing policy objectives - ensuring financial stability and extending financial inclusion - in the context of the residential mortgage lending sector in Korea.

scholarly journals Financial Consumer Protection in the Household Lending Sector : An Assessment of the Korean Experience

2017 ◽  
Vol 2 (No. 2 Oct 2017) ◽  
pp. 15-34
Author(s):  
Man Cho ◽  
Seung Dong You ◽  
Young Man Lee
Keyword(s):  
Consumer Protection ◽  
Financial Stability ◽  
Credit Card ◽  
Service Providers ◽  
Mortgage Lending ◽  
Mortgage Market ◽  
Financial Inclusion ◽  
Future Research ◽  
Regulatory Authorities ◽  
Policy Measures

The objective of this paper is to offer a systematic review and assessment of the policy measures adopted to date for financial consumer protection (FCP) in the household lending sector in Korea. In so doing, we focus on the “software” aspects of the policies adopted so far in terms of four particular groups of consumer issues: (1) information provision (by service providers), (2) financial literacy programs, (3) sales practices, and (4) dispute resolution (rules and processes). We also attempt to relate the FCP policies to two broader goals of financial market regulations - financial stability and financial inclusion. Our analyses indicate that; the regulatory authorities in Korea initiated the FCP policies early on, which cover a fairly comprehensive set of policy measures with almost all sub-items of the aforementioned four dimensions being included; some of the FCP policies are driven in large part by the intent of stabilizing the housing and mortgage market rather than protecting financial consumers per se, for which the regulatory authorities should weigh the anticipated benefit in terms of financial stability against the unintended cost in financial inclusion; and the Korean FCP policies tend to focus on the residential mortgage lending sector, which should be extended to other consumer lending products (e.g., credit – or non-collateralized – lending, credit card receivables, and car loans). Though seemingly comprehensive, the FCP policies in Korea should be further refined and enhanced with respect to their effectiveness, for which we discuss a series of future research topics.

scholarly journals The Impact Of The National Credit Act On Residential Mortgage Lending In South Africa

2018 ◽  
Vol 34 (3) ◽  
pp. 533-544
Author(s):  
Catherine Boonzaaier ◽  
Joseph Chisasa
Keyword(s):  
South Africa ◽  
Low Income ◽  
Quantitative Research ◽  
Secondary Data ◽  
Credit Market ◽  
Mortgage Lending ◽  
Policy Implications ◽  
Residential Mortgage ◽  
The Impact ◽  
National Credit Act

The purpose of the study reported in this article was to determine the impact of the National Credit Act on residential mortgage lending in South Africa.  The National Credit Act (NCA) was promulgated and implemented on 1 June 2007. The purpose of the NCA was to remove the many unfair practices, inappropriate disclosure and anti-competitive practices from the market and to achieve honesty in the credit market. Low-income groups were held back because they could not gain access to formal finance to build or improve houses or supplement housing subsidies to get bigger houses. This study applied a quantitative research design using monthly time series secondary data for the period January 2001 to August 2011. The statistical analysis techniques used in this study were t-tests, descriptive statistics, trend analysis and correlation analysis. It was found that the NCA had a positive effect on the residential mortgages in South Africa. These results have policy implications on the continued regulation of the credit market and the avoidance of reckless lending.

scholarly journals FINANCIAL INCLUSION AND MACROECONOMIC STABILITY IN EMERGING AND FRONTIER MARKETS

2019 ◽  
Vol 14 (02) ◽  
pp. 1950008 ◽  
Author(s):  
ANH THE VO ◽  
LOAN THI-HONG VAN ◽  
DUC HONG VO ◽  
MICHAEL MCALEER
Keyword(s):  
Small Businesses ◽  
Financial Stability ◽  
Optimal Level ◽  
Output Growth ◽  
Financial Inclusion ◽  
Policy Implications ◽  
Threshold Estimation ◽  
Bank Branches ◽  
Financial Products ◽  
Macroeconomic Stability

Financial inclusion, being considered as a key enabler to reducing poverty and boosting prosperity in emerging and frontier markets such as Vietnam, is the process in which individuals and small businesses are provided with an access to useful and affordable financial products and services. The extant literature on the empirical evidence regarding the contribution of financial inclusion to macroeconomic stability is mixed. This paper investigates the linkages between financial inclusion and macroeconomic stability, which has not yet been thoroughly examined in the literature, for 22 emerging and frontier economies from 2008 to 2015, with particular focus on a potential optimal level. Using the panel threshold estimation technique, the empirical findings show that financial inclusion, as approximated by the growth rate in the number of bank branches over 100,000 account holders, is found to enhance financial stability under a certain threshold. Financial inclusion is also found to be of benefit to maintaining stable inflation and output growth. Policy implications are also discussed on the basis of the important empirical findings.

FINANCIAL STABILITY AND FINANCIAL INCLUSION: THE CASE OF SME LENDING

2018 ◽  
Vol 63 (01) ◽  
pp. 111-124 ◽  
Author(s):  
PETER J. MORGAN ◽  
VICTOR PONTINES
Keyword(s):  
Low Income ◽  
Financial Services ◽  
Financial Stability ◽  
Developing Economies ◽  
Empirical Studies ◽  
Bank Lending ◽  
Financial Inclusion ◽  
Nonperforming Loans ◽  
Z Scores ◽  
Negative Impacts

Developing economies are seeking to promote financial inclusion, i.e., greater access to financial services for low-income households and firms. This raises the question of whether greater financial inclusion tends to increase or decrease financial stability. A number of studies have suggested both positive and negative impacts on financial stability, but very few empirical studies have been made. This study focuses on the implications of greater financial inclusion for small and medium-sized enterprises (SMEs) for financial stability. It estimates the effects of measures of the share of bank lending to SMEs on two measures of financial stability — bank nonperforming loans and bank Z scores. We find some evidence that an increased share of lending to SMEs aids financial stability by reducing non-performing loans (NPLs) and the probability of default by financial institutions.

scholarly journals The COVID-19 pandemic, remittances and financial inclusion in the Philippines

2021 ◽  
Vol 57 (1) ◽  
pp. 18-41
Author(s):  
Eiji Yamada ◽  
Satoshi Shimizutani ◽  
Enerelt Murakami
Keyword(s):  
Adverse Effect ◽  
Developing Countries ◽  
Detrimental Effect ◽  
Recent Literature ◽  
The Philippines ◽  
Financial Inclusion ◽  
Rural Regions ◽  
Household Level ◽  
Remittance Flows ◽  
Substantial Decline

Recent literature has revealed that financial inclusion enhances economic opportunities and security in developing countries. Moreover, a greater inflow of remittances can promote inclusiveness. In this paper, we explore the potential impacts of the COVID-19 outbreak on financial inclusion by focusing on its detrimental effect on remittance flows to developing countries. Using a household-level dataset collected in rural regions of the Philippines prior to the outbreak, we confirm that remittances are associated with financial inclusion, particularly for women. We discuss the potential impacts of the pandemic on financial inclusion through the change in the flow of remittances. We show that a substantial decline in remittances caused by the COVID-19 crisis may have an adverse effect on financial inclusion in the Philippines.

Exploring Multiplier Effects Generated by Bus Lane Combinations

2015 ◽  
Vol 2533 (1) ◽  
pp. 68-77 ◽  
Author(s):  
Long Tien Truong ◽  
Majid Sarvi ◽  
Graham Currie
Keyword(s):  
Travel Time ◽  
Traffic Volume ◽  
Policy Implications ◽  
Future Research ◽  
Negative Effects ◽  
Bus Priority ◽  
Traffic Lane ◽  
Multiplier Effect ◽  
Bus Lane ◽  
Multiplier Effects

Numerous studies have explored design and evaluation of bus lane priority by using empirical, analytical, and simulation approaches. However, none attempted to understand how different bus lane combinations, such as continuous and discontinuous bus lane sections, and a different number of bus lane sections, affect bus performance and general traffic. This paper investigates operational effects of bus lane combinations to establish whether multiple bus lane sections create a multiplier effect in which a series of continuous bus lane sections creates more benefits than several single-lane sections. If a multiplier effect exists, it suggests scale economies in wider implementation of bus priority on a networkwide scale. Overall, results confirm that there is a multiplier effect; thus bus travel time benefits and general traffic travel time disbenefits are proportional to the number of links with a bus lane. The effect suggests a constant return to scale on continuous multiple sections. The results also suggest that converting a traffic lane to a bus lane when the upstream traffic volume exceeds the capacity of the remaining traffic lanes causes significant negative effects for buses and general traffic. In addition, negative general traffic effects of continuous bus lane combinations are lower than those for a similar number of discontinuous bus lanes. Bus delays at intersections approaching the bus lane tend to improve when upstream traffic volume does not exceed the capacity of remaining downstream traffic lanes. Policy implications and areas for future research are suggested.

scholarly journals Remittances and Income Smoothing

2011 ◽  
Vol 101 (3) ◽  
pp. 582-587 ◽  
Author(s):  
Catalina Amuedo-Dorantes ◽  
Susan Pozo
Keyword(s):  
Developing Countries ◽  
Household Income ◽  
Borrowing Constraints ◽  
Income Smoothing ◽  
Reverse Causality ◽  
Income Volatility ◽  
Household Level ◽  
Level Data ◽  
Main Motive

Due to inadequate savings and binding borrowing constraints, income volatility can make households in developing countries particularly susceptible to economic hardship. We examine the role of remittances in either alleviating or increasing household income volatility using Mexican household level data over the 2000 through 2008 period. We correct for reverse causality and endogeneity and find that while income smoothing does not appear to be the main motive for sending remittances in a non-negligible share of households, remittances do indeed smooth household income on average. Other variables surrounding income volatility are also considered and evaluated.

scholarly journals Institutional commitment and aging among allied health care professionals in the British National Health Service

2020 ◽  
pp. 095148482091851
Author(s):  
Deborah Roy ◽  
Andrew Keith Weyman ◽  
Reka Plugor ◽  
Peter Nolan
Keyword(s):  
Job Satisfaction ◽  
National Health Service ◽  
Health Service ◽  
National Health ◽  
Healthcare Professionals ◽  
Job Demands ◽  
Social Institutions ◽  
Policy Implications ◽  
Skilled Workers ◽  
Negative Effects

Because of a perceived decline in staff morale, the UK National Health Service has begun to routinely assess the extent to which commitment to the National Health Service may aid staff retention. While a number of studies have investigated the role of employee commitment in relation to staff turnover, no research to date has empirically tested if staff commitment to the NHS could protect job satisfaction from the effects of high job demands, and if this varies according to age. Using latent variable path analysis, this novel study examined this question among a national sample of Healthcare Professionals Allied to Medicine in the National Health Service. The results indicate that the negative effects of high job demands on job satisfaction were fully mediated by commitment to the National Health Service, but age mattered. Among the over 45s and over 55s, commitment to the National Health Service acted as an effective buffer against the negative effects of job demands on job satisfaction, but this effect was not as strong among the 35–44 age group. The broader policy implications of these findings are that age sensitive policies to support NHS workforce retention are needed. Also, pro-social institutions who employ Healthcare Professionals Allied to Medicine should develop policies for inspiring commitment to that institution, as it could help them with the demands of the job, and may even encourage more skilled workers to work longer.

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