Division One: “Malthus Gets Fat” (Two Chapters) Chapter One develops a simple dynamic model to examine the takeoff from a Malthusian economy to a modern growth regime. It finds that several factors, most notably the rate of technological progress and the economic structure, determine the fastest rate at which the population can grow without declining living standards; this is termed maximum sustainable population growth. It is only when this maximum sustainable rate exceeds the peak rate at which a society expands that takeoff can occur. I also investigate the effects of trade and international income transfers on the ability to sustain takeoff. It is also shown that present income growth is not necessarily indicative of the ability to sustain takeoff and that factors which increase current income growth may actually inhibit takeoff, and vice versa. Chapter Two applies the sustainable population growth framework to Britain during the Industrial Revolution. The model shows a dramatic increase in sustainable population growth at the time of the Industrial Revolution, well before the beginning of modern levels of income growth. The main contributions to the British breakout were technological improvements and structural change away from agricultural production. At least until the middle of the 19th Century, coal, capital and trade played a minor role. Division Two: “Leverage and Financial Market Instability” (Four Chapters) Chapter One develops a model of how leverage induces explosive behavior in financial markets. I show that when levered investors become too large relative to the market as a whole, the demand curve for securities can suddenly become upward-sloping as levered investors are exposed to forced liquidations. The size and leverage of all levered investors defines the minimum elasticity-adjusted market size for stability or MinEAMASS, which is the smallest elasticity-adjusted market size that can support the group of levered investors analyzed. This gives rise to a measure of instability that can predict when markets become vulnerable to a leverage-driven market liquidity crisis. Chapter Two iterates the model of Chapter One forward in time to generate an inflating bubble that suddenly bursts, reproducing many of Kindleberger's (1996) stylized facts about the dynamics of bubbles in a simple framework. Chapter Three applies my measure of instability in a historical investigation of the 1998 demise of hedge fund Long-Term Capital Management (LTCM). I find that a forced liquidation of LTCM threatened to destabilize some financial markets, particularly for bank funding and equity volatility. Chapter Four discusses how the model applied to the stock market crash of 1929. There the evidence suggests that a tightening of margin requirements in the first nine months of 1929 combined with price declines in September and early October caused enough investors to become constrained that the market was tipped into instability, triggering the sudden crash of October and November.

The recent financial and economic crisis led to a deepening of fiscal problems in many countries all over the world. European countries were also hit hard by the economic downturn. The critical situation in Greece and its negative impact on the economic situation in the whole Euro zone has brought up many questions about the rigidity and functionality of the euro concept. A majority of economists and politicians support the idea of saving the Euro zone since the break up would be quite costly. There are many ideas regarding a solution to the current situation, and one of the most radical is the introduction of a parallel currency in the states which are trapped in the debt crisis. The aim of the thesis is to take a critical look at the historical development of different approaches to this theme with a focus on theories based on the devaluation as the solution. The parallel currency theory is compared to Euro zone break-up scenario and hard restructuring option and the positives and negatives of each approach are analysed. Finaly the simulation on the Greeek case is performed to prove or diproved the positive effects of parallel currency establishment. JEL Classification E31, E42, E52, E63, F15, F36 Keywords Parallel currency, financial crisis, the euro, the European Union, the Euro zone

Master Thesis - Simona Tothova Abstract This thesis empirically investigates impact of countries' bailouts on probability of SME segment distress. The impact is examined by multi-period logit model where dependent variable is distress rate and explanatory variables includes self-constructed bailout variable, several binary predictors and firm-specific and macroeconomic control variables. The hypotheses are tested on dataset for period from 2005 to 2013 including observations from seven European countries which received financial assistance program (bailout) from Troika. Every bailout from Troika comes with the requirement for austerity measures and our results suggest that impact of bailouts on SMEs probability of distress are depended on the success of application in individual countries and the impacts are more positive in non euro-zone countries. Keywords Bailout, Financial crisis, Credit risk, SME segment, Distress rate Author's e-mail tothova.simona@gmail.com Supervisor's e-mail rado.parrak@gmail.com

The thesis focuses on the impact of the banking regulation Basel III on bank-intermediated trade finance. The theoretical part of the thesis explains details of Basel III requirements, history of Basel Accords and their future in the form of Basel IV, characteristics of trade finance products and of the whole industry. Trade finance industry voiced worries about the negative effect that these new requirements might have on trade finance business. The thesis estimates determinants of bank-intermediated trade finance and includes a regulatory variable. We use trade finance data from the Czech Republic and Hong Kong in 2000−2014 and from India in 2007−2014. A negative effect of Basel III on trade finance growth is found using pooled OLS regression. Contrary to previous research, we also estimate a negative coefficient of banks' capital to assets ratios. To the best of our knowledge, the thesis provides the first empirical analysis of the impact of Basel III on trade finance. Trade finance research usually focuses more on the relationship of trade finance and trade flows and the thesis provides an extensive literature summary of this topic. The final part of the thesis contrasts different levels of risk of trade finance and shows that the imputed low-riskiness does not apply to the Czech data.

Baselregelverket är en samling råd och riktlinjer som har som mål att skapa finansiell stabilitet för banker världen över. Det finns i tre omfattningar och efter finanskrisen år 2008 påbörjades ett betydande reformarbete av Basel II efter att banker inte fångade upp riskerna i tillräckligt stor utsträckning. Med ökade kapitalkrav och en förbättrad riskhantering hos bankerna har Baselkommittén som mål att de tidigare bristerna med regelverket inte ska upprepas. Detta har medfört stora interna organisatoriska förändringar för bankerna. Syftet med den här uppsatsen är att undersöka hur finanskrisen år 2008 och reformarbetet av Baselregelverket påverkat chefers handlingsutrymme på svenska banker, där begreppet handlingsutrymme utgår från managerial discretion som handlar om chefers handlingsfrihet under påverkan av externa faktorer. Studien kommer därmed att bidra med en ökad förståelse för regelverket och lyfta fram personliga uppfattningar om hur regelverket har påverkat cheferna.   Kandidatuppsatsen är baserad på en kvalitativ forskningsmetod där vi utförde semi-strukturerade intervjuer med åtta respondenter med chefserfarenhet från svenska banker. Empirin som vi har fått fram tyder på att cheferna upplever ett minskat handlingsutrymme som en påföljd av mer komplexa regelverk. Det har blivit mer komplicerat för cheferna i dag jämfört med innan krisen att styra bankernas dagliga verksamhet på grund av ökade krav på regelefterlevnad och noggrannare uppföljning av riskmätning och kapitalkrav. Vi har även kommit fram till att cheferna upplever förändringar i sitt handlingsutrymme beroende på faktorer som exempelvis bankens storlek och deras införande av olika internmetoder. / The Basel Accords are a collection of advice and recommendations that strives to establish a financial stability of banks all over the world. The accord exists in three versions and after the financial crisis 2008 a considerable reform was established of Basel II due to the fact that previous versions did not accurately handled risks well enough. With the increasing capital requirements and improved risk management at banks, the Basel Committee on Banking Supervision wants to ensure that the previous flaws with the accord will not be repeated. This has resulted in big organizational changes for the banks. The purpose of this paper is to investigate how the financial crisis 2008 and the reform of the Basel Accord that followed have affected the latitude of managerial action of the managers in swedish banks, which is based on managerial discretion that mean changes in managerial roles under influence of external factors. The study will thereby contribute with an increased understanding for this accord and point out personal perceptions of how the regulation have affected the managers.   This bachelor thesis is based on a qualitative research where we performed eight semi-structured interviews with respondents having managerial experiences from swedish banks. The empirical data we have obtained shows that managers perceive a reduced latitude of managerial action as a consequence of more complex regulations. It’s more complicated for managers today considering how it was before the crisis to control the daily operations of the bank because of the increased demand for compliance and a stricter monitoring of risk measurement and capital requirements. We have also concluded that managers are experiencing different changes in the latitude of managerial actions depending on factors such as the bank’s size and how they introduce the various internal methods

A financial crisis in 2007 changed the development of the global financial system. A lot of financial innovations, although they cannot be considered the only reason of the crisis, affected the critical situation reasonably. The initial crisis of the financial system soon transferred into real economy. German banking system suffered from negative effects of the financial crisis. The federal government sets up a Special fund for stabilization of the financial market (Soffin) to help the financial sector. Germany is the second largest exporter in the world and the fall of the foreign demand meant a depression of its export. The Czech financial system (banking) was not affected too seriously during the initial period of the financial crisis. The main reason of this was that the majority of Czech banks are controlled by foreign subjects which meant that risky businesses were implemented by principal companies. The crisis transferred into real economy through the channel of foreign trade.

Dans cette étude, nous essayons de combler le fossé entre deux courants de la littérature. Tout d'abord, nous menons une enquête approfondie sur les relations entre la liquidité et la baisse du marché dans un pays émergent (Brésil). Dans notre recherche, nous suivons la méthodologie utilisée par Hameed et al (2010) et Adrian et al (2011). Dans la première partie de l'étude, en utilisant la variable d'estimation de la mesure de liquidité proposée par Corwin et Schultz (2012), nous effectuons une analyse des séries temporelles pour estimer l'effet des rendements sur le marché des rentabilités individuelles, et l'impact de la crise sur la liquidité. Nous étendons en outre notre analyse à la liquidité des financements, mesurée par l'écart de la rémunération entre les "commercial papers" et le taux de base de la banque centrale, pour estimer l'effet de la baisse du marché lorsque les spéculateurs sont confrontés à une contrainte de financement. Dans la deuxième partie de notre recherche nous nous intéressons aux facteurs de la liquidité. Nous estimons l'effet de la liquidité du marché sur liquidité idiosyncrasique, et examinons si cet effet est amplifié dans le contexte de baisse importante des marchés. Dans la troisième partie de la thèse, nous répartissons les actions en trois portefeuilles equi-pondérés en fonction des pratiques de gouvernance d'entreprise différentielles. Nous effectuons l'analyse mentionnée ci-dessus pour estimer si la liquidité des entreprises ayant des pratiques de gouvernance d'entreprise différentes réagit différemment en présence de baisse importante des marchés et de spirales de liquidité. / In this study we try to bridge the gap between two strands of literature, first we conduct a thorough investigation about relation between, Market liquidity, funding liquidity and market declines in an emerging market i.e. Brazil. Then we conduct the analysis in the context of differential corporate governance practices and try to find if higher corporate governance practices have an effect on liquidity and how it affects stock liquidity in market declines. We closely follow the methodology used by Hameed et al (2010) and Adrian et al (2011). In the first part of the paper, using the High-Low spread estimator proposed by Corwin et Schultz (2012) as our liquidity proxy, we conduct a time series analysis to estimate the effect of individual returns market returns, and large market declines on liquidity. We further extend our analysis to include funding liquidity, measured by the spread between the commercial paper and the central bank rate, to estimate the effect of market declines when speculators face a funding constraint. In the second part of our analysis we move towards liquidity commonality. We estimate the effect of market wide liquidity movements on individual stock liquidity, and whether this effect is amplified in the context of large market downturns. In the third part of the paper we sort the stocks into three equally weighted portfolios based on differential corporate governance practices. We conduct the above mentioned liquidity analysis to estimate if liquidity of firms with differential corporate governance practices react differently in the times of large market downturns and liquidity spirals.

Cette thèse est organisée en trois chapitres. Chaque chapitre correspond à un article dans les domaines de la finance internationale et du commerce international. Chapitre 1: Une analyse empirique du cycle électoral des taux de change réel: Asie de l'Est vs. Amérique Latine. Dans cet article, nous analysons les fluctuations des taux de change réels pendant les élections en Asie de l'Est, et nous effectuons une comparaison avec les expériences des pays d'Amérique latine. Tout d'abord, nous avons trouvé un nouveau type de cycle électoral de taux de change réel pour l'Asie de l'Est, qui s'oppose à celui des pays d'Amérique Latine. Ensuite, nous étudions les politiques utilisées par les politiciens pour influencer le taux de change pendant des élections. Chapitre 2: Populisme du taux de change. Les résultats empiriques ont montré que les économies d'Amérique Latine et de l'Asie de l'Est présentent des cycles électoraux du taux de change opposés. Les taux de change ont tendance à se déprécier pendant la période qui précède les élections et à s'apprécier ensuite pour les économies d'Asie de l'Est alors que le phénomène opposé se déroule dans les économies d'Amérique Latine. Cet article propose un modèle théorique qui explique le cycle électoral du taux de change dans ces deux régions. Le mécanisme derrière le cycle est engendrée par les politiciens qui essaient de signaler qu'ils sont du type de l'électeur médian, biaisant leur politique en faveur de la majorité de la population avant les élections. Les forces motrices du populisme d'inversion du taux de change dans ses deux régions sont les effets distributifs du taux de change réel et les différences de taille relative des secteur des biens échangeables et le secteur des biens non échangeables dans ses deux régions. Chapitre 3 : La décomposition du déclin du commerce international pendant les crises financières. La crise financière mondiale de 2008-2009 a été accompagnée d'une forte baisse du commerce international, ce qui pose la question sur le rôle de la finance sur le commerce international. Nous contribuons à cette littérature en étudiant l'impact de la crise sur les échanges bilatéraux, en utilisant les données de 103 exportateurs, 188 importateurs et 27 secteurs pour 1995-2009. Tout d'abord, nous analysons les réponses des échanges bilatéraux à la crise financière quand le choc frappe soit le pays exportateur soit le pays importateur. Ensuite, cet article contribue au débat sur l'effondrement du commerce international pendant les crises. Est-ce que la chute du commerce international est provoquée par des chocs de demande ou des chocs d'offre? Enfin, nous étudions l'impact de la crise financière sur la marge extensive du commerce, qui peut être une indication de l'impact permanent sur le commerce. / This thesis is comprised of three chapters. Each chapter corresponds to an article in the field of international finance and international trade. Chapter One: An Empirical Analysis of Real Exchange Rate Election Cycle: East Asia vs. Latin America. Empirical literature depicts an exchange rate cycle around elections in Latin America: exchange rates tend to be more appreciated before than after elections. In this paper we analyze the behavior of real exchange rates (RERs, hereafter) around elections in East Asia, and perform a broad comparison with the experiences of Latin America countries. Our contributions to the empirical literature on exchange rate election cycle are threefold. First, we find a new type of RER election cycle in East Asia region, which is opposite to one of Latin America. Second, we investigate the possible policies used by the policy-maker to influence the RER around elections. We find that RER variation around elections can be partially captured by changes in international reserves. Our results are consistent with international reserves being used by policy-makers to influence exchange rates and produce its election cycle, and we find that international reserves increase in the month preceding elections in East Asia, but decrease in Latin America. Third, we show that in both regions the RER election cycle is clearly identified before central bank reform, but the cycle disappears in the post-reform data, indicating that monetary policy is one of the channels through which the RER election cycle is generated. Chapter Two: Exchange Rate Populism. Empirical findings have shown that East Asian and Latin American economies present opposite exchange rate electoral cycles: exchange rates tend to be more depreciated before and appreciated after elections among East Asian economies, and the opposite is true in Latin America. This paper proposes a theoretical model that explains the opposite exchange rate electoral cycle in these two regions. In a setup where policy-makers differ in their preference bias towards non-tradable and tradable sector citizens, the RER is used a noisy signal of the incumbent's type in an uncertain economic environment. The mechanism behind the cycle is engendered by the incumbent trying to signal he is median voter's type, biasing his policy in favor of the majority of the population before elections. The driving forces of the opposite exchange rate populism in these two regions is the RER distributive effects and the difference of the relative size of tradable and non-tradable sectors in these two regions. Chapter Three: The Decomposition of Trade Collapse during Financial Crises. The global financial crisis of 2008-2009 was accompanied by a sharp decline in international trade, which raises the question on the role of finance on international trade. We contribute to this literature by investigating the impact of financial crises on bilateral trade, using data of 103 exporters and 188 importers at 27 sectors-disaggregation from 1995 to 2009. Firstly, we analyze the responses of bilateral trade to financial crisis and the shock hits the exporting country or the importing country. Secondly, this paper investigates whether the trade collapse following crisis is caused by demand or supply shocks. Thirdly, we investigate the impact of financial crisis on the extensive margin of trade, which may be an indication of its permanent impact on trade.

O objetivo do trabalho será avaliar se os efeitos da crise financeira de 2008 relativizaram as características da autonomia dos bancos centrais, que são conceitualmente vinculadas à manutenção da estabilidade de preços como objetivo singular da política monetária. Devido a seu perfil institucional e seu contexto de atuação, as decisões do Banco de México (Banxico) servirão como estudo de caso. A análise busca demonstrar que, diante da severidade dos efeitos da crise, o Banxico optou por aplicar uma política monetária eclética no período, já que abandonou ocasionalmente seu mandato constitucional orientado para a estabilidade de preços, mesmo que sem prejuízos ao cumprimento das metas de inflação. Por um lado, o banco seguiu conservador na utilização da taxa de juros como principal instrumento monetário, sem recorrer à compra direta de ativos e outros mecanismos não convencionais aplicados nos países industrializados. Por outro, demonstrou sensibilidade à degradação do cenário internacional e à atividade doméstica, tanto ao manter os juros inalterados durante um longo período, como ao reduzi-los sucessivamente diante do desempenho fraco da produção entre 2013 e 2014. Assim, ao menos durante a crise, o comportamento do Banxico se afastou das definições convencionais sobre a autonomia do banco central, o que reforçou a natureza política da organização. / This article aims to evaluate if the effects of the 2008 financial crisis relativized the main characteristics of the central bank\'s autonomy, that are conceptually related to the maintenance of price stability as a single objective of the monetary policy. Due to its institutional profile and its operational context, the decisions of the Banco de Mexico (Banxico) will serve as a case study. The analysis seek to demonstrate that, despite the severity of the crisis, Banxico has chosen to apply na eclectic monetary policy in the period, as it occasionally abandoned its constitutional mandate oriented towards price stability, even without harm to the achievement of its inflation targets. On the one hand, the bank remained conservative in the use of the interest rate as the main monetary instrument, without resorting to the direct asset purchase or other non-conventional mechanisms applied by industrialized countries. On the other, the bank demonstrated sensitivity to the degradation of the international markets and domestic activity, both by keeping the interest rate at the same level for a longer period as by reducing it succesively before the poor output performance between 2013 and 2014. Thus, at least during the crisis, Banxico\'s behavior departed from the conventional definitions of the autonomy of central banks, which reinforced the political nature of the organization.

Evidencia-se na atual fase de expansão do capital agroindustrial canavieiro a reafirmação da necessidade de sequentes somas de investimentos, processo a contar significativamente com inversões do sistema financeiro, tendo como destaque a mediação estatal nesse contexto. Repete-se assim, algumas das mesmas características que marcaram a expansão canavieira em períodos precedentes, como durante o Proálcool, isto é, uma necessidade sempre presente da subvenção estatal, seja para garantir a implantação e/ou modernização de unidades processadoras, seja para imputar o desenvolvimento e aperfeiçoamento das lavouras. No âmbito desse processo, reitera-se uma busca pelo aumento de ativos imobilizados pelas diversas empresas do segmento, com destaque para intensificação da incorporação de novas áreas de lavoura canavieira. Conforma-se assim um cenário de pressão sobre as médias e principalmente as pequenas propriedades, realidade posta num contexto de concentração de terras sob o controle da agroindústria da cana. Este cenário foi analisado a partir de casos específicos na área delimitada para estudo, a destacar o Bairro União e o Projeto de Assentamento Fazenda Primavera, localidades compreendidas entre os municípios de Andradina, Castilho e Nova Independência. / Evident in the current phase of expansion of the sugarcane industry reaffirming the need for sums of investments, counting on significant investments in the financial system, with the highlight state mediation in this context. Is repeated so some of the same features that marked the sugarcane expansion in previous periods, such as during Proálcool, an ever present need of state subsidy, is to ensure the development and / or modernization of processing units, is to impute the development and improvement crops. As part of this process, it is reiterated a search for fixed assets increased by several companies in the segment, which also means an intensification of the incorporation of new areas of production of sugarcane. Conforms well a backdrop of pressure on small and medium farms, actually put in a context of concentration of land under the control of the sugarcane industry. This scenario was analyzed from specific cases in the defined area for study, the Neighborhood União and Settlement Project Spring Farm, localities between municipalities Andradina, Castilho and Nova Independência.