The presence of toxic order ow and predatory HFT strategies in a multi-market setting are scarcely researched in the academic world. This thesis studies the toxicity levels of a set of markets by examining unconsolidated quote data and firm specific trade data. A method for deducing the markets toxicity levels is presented along with proxies for toxic order ow, namely: changes in spread and quoted volume, following a trade in a given market. We find both signs of toxicity and different toxicity levels between the markets. However, the results are lacking in statistical significance but they show that this field is of great interest for further research. Also, the methods proposed for deducing the toxicity levels are rudimentary but could serve well as a premise for further development. / Närvaron av toxic order flow och predatoriska HFT-strategier i en flermarknadsmiljö är föga studerat i den akademiska världen. Denna avhandling studerar detta på en uppsättning marknader genom att undersöka okonsoliderad quote data och firma specifika trades, och på så vis ta fram marknadernas toxicity-nivåer. En metod för att fastställa marknadernas toxicity-nivåer presenteras tillsammans med proxys för toxic order flow, mer specifikt: förändringar i spread och quotad volym, efter en handel på en given marknad. Vi finner både tecken på toxicity och olika toxicityniv åer mellan marknaderna. Resultaten saknar dock statistisk signifikans men de visar ändå på att detta område är av stort intresse för ytterligare forskning. De metoder som föreslås för att fastställa toxicity-nivåerna är rudimentära, men kan tjäna som en utgångspunkt för vidare utveckling.

The thesis examines factors that influence sustainability and success of microfinance institutions in Ghana. The topic is important, particularly in poverty stricken Africa, where microfinance institutions play a significant role in supporting governments¿ initiatives to reduce/alleviate poverty. The developed model is tested using data collected from 14 face-to-face interviews and 114 questionnaires. The data is analysed using different techniques- descriptive statistics, cross-tabulations and regression analysis. The research design and scale of the study are appropriate to both the problem addressed and doctoral level research. A number of factors in the model developed were found to be influencing the sustainability and success of microfinance institutions. A model was proposed that seeks to offer an explanation of sustainability and success of Microfinance Institutions in Ghana. The proposed model identified five categories being: institutional characteristics, agency costs, business strategy, environment/governance and success. Single factor analysis established positive relationships between sustainability and all the five factors but placed more emphasis on three out of the five factors namely; success, business strategy and environment/ governance. Multiple factor analysis established no significant differences in the sustainability with respect to the type of MFI, ownership and source of funding. Multiple Regression which allows for the testing of theories or models established a significant relationship between the Operational Self Sufficiency (OSS) and the predictors, especially the drop-out rate of clients and average loans. The Subsidy Dependence Index (SDI) was calculated for the various types of MFIs and the result was a high dependency ratio especially among the FNGOs. Though the dependency is on the decline, it is very slow indicating that most MFIs will depend on subsidies for a very long time to come. Finally it was observed that the relatively high interest rates charged by most of the MFIs tended to defeat the purpose for which the microfinance movement came about. Not only did the study confirm the research model, but it also revealed that most owners did not exhibit a deep sense of involvement and used general knowledge to practice in Ghana. The study concluded that success factors, business strategy, and environment/governance were the most critical of the sustainability factors in Ghana. It is therefore important that managers develop institutional capacities especially in managing the agency problem effectively if they have to be sustainable and successful.

Having the author been involved in banking and finance for almost 25 years, this thesis intends to reflect on the role of banks with emphasis on cross border lending and credit rating, their effectiveness and the impacts of cultural differences. Perhaps this would not differ substantially from a researcher or a scholar, yet the exploratory approach taken in this research will be somewhat different as it deliberately seeks to answer a number of questions relevant to practitioners in today’s banking. In trying to achieve this goal, this thesis hopefully may find its way to international bankers wondering about the perspectives of their business in general and their profession in specific. It even may perhaps improve the understanding of their clients. The Basel committee which published the new Basel II framework on bank regulation and supervision was the result of long and careful discussions, wide consultations and comprehensive impact studies. Whereas Basel II covers the entire risk profile and supervision of financial institutions, this research is limited to the cross border lending by banks to companies and provides the views from both practicing international bankers and their customers on their 3 expectations regarding Basel II, credit rating and the relevance of context and culture differences. Bankers all over the world are being trained on how to read balance sheets, yet less attention is being paid as to by whom they are being created and how precisely these balance sheets came into existence, other than the accountancy standards applied. Bankers furthermore seem to agree on the fact that credit risks in large part are related to the management competencies, effective corporate governance and integrity of management and organization. The argument could be made that the assessment of management capabilities, governance and integrity may be hindered in those cases where the culture is little understood. In a three days conferences titled; “The Future of Relationship Banking”, 80 senior executives from international banks and large companies were gathered in Punta del Este, Uruguay and were asked to speak about these aspects. A transcript of the conference is provided as annex to this thesis (Annex 1) and serves to triangulate the findings of the research. Main findings of three management papers were presented by the researcher during the conference. A survey was performed during the conference and in addition, through an online survey, in total over 100 practitioners in the field participated in the survey. Results show a variation of conclusions, but very especially seem to confirm the view, contrary to the approach taken in Basel II, that cultural differences and context are felt to be highly relevant in cross border lending.

This paper aims to analyze the phenomenon of adverse selection of its presence and potential short-term impact on the Swedish stock market. Adverse selection refers to a situation where information asymmetry among market participants might lead to potential imbalances in information and unfairness among all market participants. The primary objective of this paper is to determine and analyze the potential existence of adverse selection and to explore its effects on the short-term trading volume before announcements.  This study's research design and approach are through data collection, to analyze the relationship between traded volume and disclosures. Five highly traded stocks, Atlas Copco AB, Evolution AB, Swedbank AB, Hexagon AB and AB Volvo are selected for the analysis, representing different sectors. A historical data analysis method and event studies are being used to identify abnormal fluctuations in trading volume before announcements. Data on volume and stock prices are collected over one year, between 11 May 2022 - 11 May 2023. By utilizing various statistical methods and econometric techniques, abnormal volume fluctuations before announcements could be measured and analyzed.  This paper concludes the existence of short-term adverse selection on the Swedish stock market cannot confidently be determined considering this analysis only, as indicated by nonsignificant abnormal fluctuations in the short-term trading volume before announcements. However, the results of the data collection in the period between 11 May 2022 - 11 May 2023, on five high-market capitalization companies, still emphasize and illuminate the importance of ensuring and maintaining efficient and fair markets.

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No description available.

Essay I: This essay provides an overview of the history of the Swedish pension system. Starting with the implementation of the public pension system in 1913, it outlines the key components of each major pension reform up until today along with a discussion of the main trade-offs and concerns that policy makers have faced. It also describes the historical background of the four largest occupational pension plans in Sweden and the mutual influence between these plans and the public pension system.        Essay II: Despite the fact that the increasing involvement of the private sector in pension provision has brought more flexibility to the pay-out phase of retirement, little is known about the characteristics of those who choose to annuitize their pension wealth and those who do not. I combine unique micro-data from a large Swedish occupational pension plan with rich national administrative data to study the choice between life annuities and fixed-term payouts with a minimum payout length of 5 years for 183,000 retiring white-collar workers. I find that low accumulation of assets is strongly associated with the choice of the 5-year payout. Consistent with individuals selecting payout length based on private information about their mortality prospects, individuals who choose the 5-year payout are in worse health, exhibit higher ex-post mortality rates and have shorter-lived parents than annuitants. Individuals also seem to respond to large, tax-induced changes in annuity prices.            Essay III: This essay estimates the causal effect of postponing retirement on a wide range of health outcomes using Swedish administrative data on cause-specific mortality, hospitalizations and drug prescriptions. Exogenous variation in retirement timing comes from a reform which raised the age at which broad categories of Swedish local government workers were entitled to retire with full pension benefits from 63 to 65. The reform caused a remarkable shift in the retirement distribution of the affected workers, increasing the actual retirement age by more than 4.5 months. Instrumental variable estimation results show no effect of postponing retirement on the overall consumption of health care, nor on the risk of dying early. There is evidence, however, of a reduction in diabetes-related hospitalizations and in the consumption of drugs that treat anxiety. Essay IV (with Per Engström): The consumption based method to estimate underreporting among self-employed, introduced by Pissarides and Weber (1989), is one of the workhorses in the empirical literature on tax evasion/avoidance. We show that failure to account for transitory income fluctuations in current income may overestimate the degree of underreporting by around 40 percent. Previous studies typically use instrumental variable methods to address the issue. In contrast, our access to registry based longitudinal income measures allows a direct approach based on more permanent income measures. This also allows us to evaluate the performance of a list of instruments widely used in the previous literature. Our analysis shows that capital income is the most suitable instrument in our application, while education and housing related measures do not seem to satisfy the exclusion restrictions.

Este estudo faz uma análise teórica e empírica dos processos de licitação e contratação de obras e reformas de prédios públicos em uma Universidade Pública Federal, utilizando a Teoria da Informação Assimétrica e dos Contratos. O período da pesquisa foi entre 2010 a 2013, na Universidade Federal do Rio Grande do Sul, sendo que foram analisados 127 processos licitatórios e contratos. As análises revelaram diversas ocorrências em licitações e nas contratações de obras e reformas. Na etapa licitatória, anterior à contratação (ex ante), a sessão para lances das licitações de obras e reformas, em alguns casos, estiveram desertas. Na contratação e execução de obras e reformas (ex post), foram constatados diversos pedidos de prorrogação de prazos e de reequilíbrio econômico financeiro, e na fiscalização das obras e reformas foram constatadas 31 ocorrências nos serviços finalizados pelas Empreiteiras. Os resultados também indicaram que, do total dos processos analisados no período de 2010 – 2013, cerca de 30% das obras e reformas ainda não foram finalizadas ou estão suspensas, o que demonstra deficiências na fiscalização e na gestão dos contratos. Além disso, o tempo médio entre a abertura do processo e a conclusão dos serviços gira em torno de três anos, sendo que grande parte deste tempo foi despendido com procedimentos internos da UFRGS. Tais fatos indicam problemas de seleção adversa e assimetria de informações, além do Hold up problem, em que o Principal é tomado como refém pelo Agente e do problema do Risco moral (Moral Hazard), em que o Agente passa a agir de modo não apropriado ou não aprovado pelo Principal, com a ocorrência dos custos de transação. / This study makes a theoretical and empirical analysis of the processes of bidding and contracting works and reforms of public buildings in a Federal Public University, using Asymmetric Information Theory and Contracts. The period analyzed was between 2010 and 2013, at the Federal University of Rio Grande do Sul, being that 127 bidding processes and contracts were analyzed. The analyses revealed several occurrences in tenders and hiring of work and restoration. In the bidding phase, prior to hiring (ex ante), the bidding session for work and renovations, in some cases, was deserted. There were several requests for deadline extension, and economic-financial adjustment in the work and restoration hiring and execution (ex post), while in the inspection of work and restoration it could be noticed 31 occurrences in services finalized by the contractors. The results also indicated that, of the total number of processes analyzed in the period 2010-2013, about 30% either have not been completed or are suspended, which shows deficiencies in the supervision and management of the contracts. In addition, the average time between the opening of the process and the conclusion of services is about three years, and much of this time was spent with internal procedures of UFRGS. These facts indicate problems of adverse selection and information asymmetry , in addition to the "Hold up problem", in which the Principal is taken hostage by the Agent besides the problem of Moral Hazard, when the Agent begins to act inappropriately or in a way which is disapproved by the Principal, together with the incidence of transaction costs.

資訊不對稱為經濟普遍存在之現象，舉凡勞動市場、保險市場與借貸信用市場皆會發生類似主問題。而本文將就資訊不對稱下之借貸信用市場討論效率問題。 　　眾所皆知，當借貸市場存在資訊不對稱時會發生二大問題：道德危險、逆選擇問題，又因此三大問題會導致貸款者對特定契約之供給減少使借貸市場發生超額需求產生信用分配之現象。故可知，市場均衡因資訊不對稱現象之存在可能無法滿足柏拉圖最適。因此本文將借用四個理論模型說明：借貸信用市場之效率問題。 　　理論模型一：逆選擇下之借貸市場效率一最適放款利率與擔保品之決定 　　理論模型二：逆選擇下之借貸市場效率一最適投資水準之決定 　　理論模型三：逆選擇與道德危險下之信用分配效率 　　理論模型四：償還機率訊息不對稱下之資金配置與金融崩潰 　　透過此四個理論模型之分析可歸納出以下之結論： 　　1.借貸市場存在穩定均衡且均衡滿足市場效率時，政府無須干預借貸市場。 　　2.借貸市場存在穩定均衡且無信用分配現象但均衡未滿足市場效率時，政府就應採行自由放任之態度，透過金融中介機構之借貸行為達成社會效率。 　　3.借貸市場存在穩定均衡且存在信用分配現象但均衡未滿足市場效率時，政府就應採行交叉補貼政策干預市場，但並非所有的干預政策皆能使借貸市場之效率提升，其中尤以“補貼低品質借貸契約”之政策為最佳方案，但因為此政策須政府能夠完全區分借款者之品質型態才可採行，因此，若政府無法加以區分借款者之品質型態時，僅好退而求其次採行次佳方案“信用保証政策”。 　　4.借貸市場若不存在均衡，發生金融性崩潰時，政府應擔任最後貸款者之角色，干預借貸市場以降低私人部間之風險。

Financial intermediaries are recognized to promote the efficiency of resource allocation by mitigating problems of incentives, asymmetric information and contract incompleteness. The role played by financial intermediaries is perceived so crucial that these institutions have received all over the world the greatest attention of regulators. Differences in regulatory regimes as well as in the real economies have produced a large variety in the characteristics of financial sectors and of individual intermediaries. In particular, in different places and times it is possible to observe banking sectors more or less competitive, populated by credit intermediaries of different sizes and with different levels of specialization. This variety of institutions raises interesting questions about the features of a well functioning financial intermediation sector. These questions have inspired an important body of economic literature which, however, is still inconclusive in many aspects. This dissertation includes three studies all intending to contribute in this direction. Chapter 2 Recent empirical works have found evidence consistent with larger banks having lower incentives to collect soft information and, in particular, to lend to small firms which are typically regarded as relatively opaque borrowers. Another market segment affected by relatively high levels of opaqueness is that of long-term loans and the reason is that, as emphasized in the corporate finance literature, short-term maturities are useful for the purpose of screening and monitoring investment projects. It is therefore interesting to assess whether large and small banks differ in their propensity to issue long-term loans, a type of investigation which has not been conducted yet. The reason why small and large banks might be expected to have a different propensity to issue long-term loans has to do with two notions. First, the effectiveness of a short-term maturity as a screening and monitoring device is preserved only if parties anticipate that, when payments are due, the lender will not be willing to extend the maturity, otherwise the initial short-term loan is de facto a long-term one. The problem may rise if the liquidation of insolvent firms produces lower payoffs than their refinancing: under these circumstances, as suggested by theories on renegotiation, liquidation is not implemented no matter what is written on the contract (parties can easily avoid the inefficiency that would result from liquidation, for example by simply granting a new loan). Second, at a more specific level theories on renegotiation suggest that the ability to commit to not extend thematurity decreases with bank size.1 Small banks are therefore predicted to issue shorter-term loans and to make a better selection of projects. The results are consistent with this prediction. Controlling for other characteristics of both the demand- and the supply-side as well as for the type of guarantee supplied, small banks have lower proportions of long-term loans to total loans and lower proportions of non performing loans to total loans. It should be pointed out that this does not imply that small banks are necessarily more efficient since short-term maturities also have costs; in particular, short-term maturities can interfere with the incentives of good types by inducing short-termism (the inflation of shortterm results at the expenses of total profitability). Moreover, beyond the ability to commit other supply-side features are shown to be relevant in the determination of the maturity, at least with specific classes borrowers. In particular, the findings are also consistent with the presence of economies of scale in lending at long maturities to firms in more technical and innovative industries. Since providing the right incentives to high quality entrepreneurs and to firms in innovative sectors is more likely to be a priority in more advanced countries, a policy implication is that these economies need more the presence of large credit institutions and the more so if venture capital and stock market are of limited size. Chapter 3 As already emphasized, theories on renegotiation suggest that the ability of banks to commit to a given course of action is an important factor for efficiency and that such ability depends on observable characteristics, like bank size. An important aspect which has not been analyzed in the theoretical literature is the effect that competition among banks exert on their ability to commit. The theoretical model presented in chapter 3 tries to provide an answer to this question. More specifically, the model studies the effects of competition among banks when these are subject to dynamic commitment problems which may result in excess refinancing of insolvent borrowers (soft budget constraint) as well as in excess termination of profitable ones (ratchet effect and short-termism). The building assumption is that, because of priority schemes and relationship lending, competition is harsher for new lending than for lending to ongoing projects. The main conclusion is that there exists a trade-off between the benefits that competition brings by disciplining low quality borrowers and the costs implied by worsening the incentives of good ones. The model also allows to look at the effects of competition on stability. This is done in two ways by looking at the extent to which competition interferes with the procyclicality of the banking sector and by studying if competition may eliminate or add inefficient equilibria. The main policy implication is that the optimal level of competition of a banking system is positively related to the quality of the underlying economy. If taken together, the results of chapters 2 and 3 also provide a theory about local or regional banks which is not based on any aprioristic assumption about the technology of these type of intermediaries. As long as these institutions can be seen as banks with a relatively high market power and a relatively small size (they are often important players at a local level although of limited size), both chapters 2 and 3 suggest that these intermediaries can more easily commit to a tough stance at the refinancing stage, with positive effects on their ability to screen out bad projects but with negative effects on their ability to incentivize good types and to fund more technical and innovative firms. In other words, these institutions might promote growth at earlier stages of development, although they are not sufficient to address the incentive issues of more advanced economies. Interestingly, this interpretation of the role of local banks is totally distinct from the traditional one which is based on the aprioristic assumption that these banks are good in doing relationship lending. Chapter 4 Conflicts of interest of economic institutions carrying out a variety of functions are considered a widespread phenomenon severely limiting the efficiency that can be achieved. These worries are often taken as justification for regulations imposing transparency requirements or tougher measures like separation of functions. At the same time, contract theory suggests that the effects of opportunistic behavior can be limited by adopting appropriate incentive schemes. The third study, chapter 4, tries to understand from a theoretical point of view to what extent the use of incentive schemes can address the distortions posed by the presence of conflicts of interest. The universal bank is regarded as a (common) agent serving different clients with potentially conflicting interests: for example, it may buy assets on behalf of investors and sell assets on behalf of issuing firms. The clients offer incentive schemes to the bank and they behave non-cooperatively. The bank decides a level of effort and, when firewalls are absent, a level of collusion, modelled as a costly and unproductive redistribution of wealth among the clients (for example, the banks can at no cost sell the securities it is underwriting to the funds it manages and can do so at the price it likes). Firewalls are defined as all legal or economic devices imposing a real separation of functions and therefore preventing the bank from colluding as specified above. The main conclusion is that in the absence of firewalls the equilibrium incentive schemes are steeper. This means that the equilibrium level of effort is higher and may compensate the (ex post) inefficiency of collusion. In other words, not only appropriate incentive schemes can eliminate the distortions posed by conflicts of interest but, at least in principle, their presence may even be necessary for efficiency (this happens if effort is a public good for the two principals so that the allocation without firewalls is characterized by under-provision of effort). At the same time, the allocation without firewalls is shown to be the least efficient in the presence of one naive player who does not recognize the existence of the conflict of interest. As long as transparency requirements can be considered tools to improve market participants’ sophistication, these results suggest why and how this type of regulation can work. Moreover, the model allows to draw conclusions about the desirability of tougher regulation prescribing a more or less neat separation of functions. With sophisticated economic agents, who can address the distortions posed by conflicts of interest by choosing appropriate incentive schemes, separation of functions is unnecessary or even detrimental for efficiency. On the other hand, more or less powerful firewalls are desirable if market participants are not considered sufficiently sophisticated to be able to react to the presence of conflicts of interest and if transparency requirements cannot increase their sophistication. In few words, the optimal regulation of conflicts of interest is softer in situations involving professionals who are more likely to realize and to react by choosing an appropriate incentive scheme or, more generally, for institutions operating in advanced economies where the average level of market participants sophistication is higher.