Version:1.0 StartHTML:0000000183 EndHTML:0000003190 StartFragment:0000002393 EndFragment:0000003154 SourceURL:file://localhost/Users/benjaminhudgens/Desktop/Final%20Thesis.docx This thesis will use data from 2009 to examine two questions about the Microfinance industry. First, why do firms charge interest rates well beyond their cost of funds and second, are there important differences at the national level that can help us to understand the high interest rates in Microfinance? I find that interest rates are primarily a result of operating expenses, but profit-status has large effects in developed Microfinance markets. I also find that the Economist Intelligence Unit’s measures of regulatory environment and industrial development explain a large portion of the variation in interest rates across countries.

This paper examines how various monetary policy signals such as official discount rate changes¡Bspeeches and monetary aggregate M2 annual growth rate affect the structure of interest rates in Taiwan. The model of the thesis is based on the Svensson model (1994) which is the extension of the parsimonious model defined by Nelson and Siegel (1987). It is being shown, that the term of interest rates, estimated based on Svensson model result in a fault value for Taiwan, due to a unsound bond market especially in the short term and one-year interest rates. There is no proof that unexpected movements in the short end of the yield curve are mainly driven by unexpected changes in the official discount rate. Speeches are found to be a more important determinant for the longer end of the term structure. The conclusion is that central bank communication is an essential part of the conduct of monetary policy.

Thesis (M.C.A.)--Victoria University of Wellington, 2009. / Includes bibliographical references.

Thesis (Ph. D.)--University of California, San Diego, 2003. / Vita. Includes bibliographical references.

Thesis (Ph. D.)--University of California, San Diego, 2003. / Vita. Includes bibliographical references (leaves 106-110).

Thesis (Ph. D.)--York University, 2001. Graduate Programme in Economics. / Typescript. Includes bibliographical references (leaves 101-103). Also available on the Internet. MODE OF ACCESS via web browser by entering the following URL: http://wwwlib.umi.com/cr/yorku/fullcit?pNQ67897.

published_or_final_version / Economics and Finance / Doctoral / Doctor of Philosophy

The objective of this study was to determine what impact, if any, interest rate subsidies have on the price of farmland in Canada. The basic capitalization model is used as a starting point for the development of several models. These econometric models are then estimated, using data from four provinces: Quebec, New Brunswick, Manitoba and Saskatchewan. The time period studied is 1972 to 1991. The findings indicate that interest subsidies do in fact affect land values, however the effect is relatively small. There are large differences between provinces in terms of subsidy amount and consequently in terms of the effect of the subsidy programs on the value of land in each province.

The international Fisher effect is identified as part of the four-way equivalence model. This model outlines a relationship between exchange rates, interest rates and inflation rates. The international Fisher effect, specifically, states that the difference in interest rates between two countries is an indicator of the expected change in exchange rates of their currencies. The aim of this paper is to test the validity of the international Fisher effect between South Africa and the UK. The understanding of the exchange rate movements is vital for management decisions, investment activity and policy making for central banks and government. Data has been collected for a sampling period beginning in July 1995 and ending in April 2001. Interest rates in the UK and South Africa are recorded for this period. A record of exchange rate movements for the same period has also been compiled. Using this data, a simulation of an uncovered interest arbitrage was carried out. This was done by taking £100 from the UK, converting it to Rands and investing those Rands in a South African bank. At the same time, £100 was also invested in a UK bank. As interest accrued over the test period, interest rates in both countries changed, exchange rates fluctuated and the balance in the South African account was compared to the balance in the UK account. According to the model, the real balances in both the accounts should remain equivalent over the sampling period. It was found that interest rates in SA were higher, more volatile and less cyclic than those in the UK. As predicted by the model, the exchange rate (in R/£) constantly increased over the sampling period. Reasons for the higher interest rates in SA include a low national savings rate, high inflation, the South African economies vulnerability to events in the international market and the reserve bank's monetary policies. The simulated arbitrage was found to be profitless and the balances of the two simulated investment accounts were found to be statistically similar. There were, however, some short term deviations from the theory. The value of the SA account was lowest during times of high interest rates in SA, when there was volatility in the forex market and when the exchange rate was at peaks in the cycle. Nevertheless, the exchange rate - interest rate relationship always returned to equilibrium. The risk and unpredictability associated with the international market is high while only small chances exist to achieve economic gain from borrowing from low interest rate environments (or investing in countries where the interest rates are high). It was concluded that the international Fisher effect, between the UK and South Africa, for the period studied, had significant short term deviations but is valid over the medium term. The implication for business practice is that stakeholders should be conservative when faced with risk associated with foreign exchange exposure unless, as is the case with speculators, it is their core competence to predict macroeconomic trends and profit from beating the market. / Thesis (MBA)-University of Natal, Durban, 2001.

This thesis measures the extent to which the interest rate falls after an increase in the money supply. Even though the South African Reserve Bank has as a commitment, a goal for the inflation rate to vary between a prescribed band, it still needs to be able to use active monetary policy if economic conditions require intervention. To this end it is of interest to measure the number of quarters for which interest rates remain low after the liquidity of the macro-economy improves. In the monetary literature (for example Melvin (1983)) there are methods that have been used to measure the duration of the decline in the interest rate. These models have not to our knowledge been tested using South African data. We find evidence that the monetary authorities can induce falling interest rates for approximately one quarter using appropriate monetary policy. This result was subjected to testing under alternative assumptions concerning the structure of the error term and found to be robust. This thesis argues for the first time, that there may not be a set pattern to the time path of the interest rate, and inflationary expectations may cause the interest rate to rise, however, this rise is not confined to one uniform adjustment over time, but may occur in separate discrete adjustments. This theoretical innovation and the possibility of an identification problem suggested we estimate another more general model of interest rate determination The second model we estimate is that of Mehra (1985). After a careful analysis of the data to ensure that there are no major statistical problems with the South African data, we find that inflationary expectations result in a higher interest rate especially in times of higher expected inflation. Thus, one benefit of the Reserve Bank's current policy that aims for a band between which the rate of inflation (appropriately defined) must fall, is an improved operation of the transmission mechanism. Therefore, if intervention is required, say, if the economy suffers a severe supply shock, then monetary policy can be effective. / Thesis (M.Com.)-University of Natal, Pietermaritzburg, 2001.