This paper identifies the optimal mortgage choice of homeowners, who are subject to counter-cyclical income volatility and idiosyncratic income risk. The market equilibrium of investors with similar income risk exposures, leads to pro-cyclical equilibrium interest rates. The key determinant of the optimal mortgage choice is the correlation of income with the business cycle. Homeowners with high...

In this paper, we analyze the impact of banks’ non-interest income share on risk in the German banking sector for the period between 2002 and 2010. Using linear and quantile regression estimators, we find that the impact of non-interest income on risk significantly differs depending on banks’ overall business model. More specifically, we show banks with retail-oriented business model such as sa...

This paper reconsiders the cost of business cycles under incomplete markets. Primarily, we focus on the heterogeneity in the cost of business cycles among agents with different skill levels. Unskilled workers are subject to a much larger risk of unemployment during recessions than are skilled workers. Moreover, unskilled workers earn less income, which limits their ability to self-insure. We ex...

Reducing corporate risk has long been a business strategy concern. Many scholars support diversification as a method to achieve risk reduction. Building on organisational portfolio analysis, we develop the concept of ‘desynchronicity’ as a complement to existing diversification theories about risk reduction. Organisational portfolio analysis views firms as portfolios of business units, suggesti...

rural economy has an important role in rural sustainable development in every region or country. however, the rural economy in iran is too much depending on agriculture and development of other rural economy in particular nonfarm activities, has been neglected by iranian rural communities. therefore, the aim of this study was to identify the role of non-farm business on rural sustainable develo...

In this paper, I examine the effect of business cycles on the employment, earnings, and income of persons in different demographic groups. I classify individuals by sex, education, and race. The analysis uses data from the Current Population Survey’s Outgoing Rotation Group data, covering the period 1979–1992, and March Annual Demographic File data, covering the period 1975–1997. Many different...

rural economy has an important role in rural sustainable development in every region or country. however, the rural economy in iran is too much depending on agriculture and development of other rural economy in particular nonfarm activities, has been neglected by iranian rural communities. therefore, the aim of this study was to identify the role of non-farm business on rural sustainable develo...

This thesis studies two strategies that households may use to keep their consumption smooth in the face of fluctuations in income and expenses: credit (borrowing and savings) and insurance (statecontingent transfers between households). The first chapter asks why insurance among households in rural Thai villages is incomplete. The second chapter analyzes the impacts of micro-credit. The third c...

Equity Payout is ‘Net dividends of nonfarm, nonfinancial business’ (Table F.102, line 3), plus ‘Net dividends of farm business’ (Table F.7, line 24), minus ‘Net increase in corporate equities of nonfinancial business’ (F.101, line 35), minus ‘Proprietors’ net investment of nonfinancial business’ (F.101, line 39). Debt Repurchase is the negative of ‘Net increase in credit markets instruments of ...