Capital allocation for credit portfolios has two meanings. First, at portfolio level it means to determine capital as a buffer against an unexpected negative cash-flow resulting from credit losses. In this case, the allocation method can be specified by means of a risk measure. Its result is called economic capital of the portfolio. Second, at sub-portfolio or transaction level, capital allocat...

In recent years, policymakers have proposed various fiscal policies to spur long-run economic growth through increased capital formation. The Bush Administration, for example, proposed lowering the capital gains tax rate. The Clinton Administration, among other measures in its economic package, proposed reinstituting the investment tax credit. These proposals stem from heightened concerns that ...

This paper discusses the connection between social capital and trends in economic well-being. Although arguments for the growth-enhancing aspects of social capital are concerned with the impacts of social capital on well-being, in practice research has focussed on the relationship between social capital and trends in GDP per capita. However, there are severe disadvantages to using GDP per capit...

In many financial institutions, there is a well established practice of measuring the risk of their portfolios in terms of economic capital (cf., e.g. Dev, 2004). Measuring portfolio-wide economic capital, however, is only the first step towards active, portfolio-oriented risk management. For purposes like identification of concentrations, risk-sensitive pricing or portfolio optimization it is ...

The paper investigates the effects of imports and foreign capital inflows on economic growth in case of Pakistan over the period of 1990Q1-2008Q4. We have applied ARDL bounds testing approach to examine the long run relationship and investigated the direction of causality by using VECM multivariate framework. Our analysis confirms the long run relationship between imports, foreign capital inflo...

This paper examines the impact of industrial policy on capital structure based on a partial adjustment model of capital structure that incorporates financial flexibility, macroeconomic conditions, economic development as well as firm-level factors. The issue is investigated in the context of Taiwan where industrial policy is widely considered to have played a strategic role in its economic succ...

Capital accumulation is the driving force of urban economic development. Many contemporary urban problems—including rapid land price inflation, greater socio-spatial inequalities, and the stresses of middle-ring suburbs—are traceable to the forms that the accumulation process is taking. Changes in the relationships between industrial capital, financial capital, and property capital underpin the...

We use a large micro-dataset to assess the importance of intangible capital organisation, R&D and ICT capital – for the economic performance of establishments and regions in Germany. In 2003 self-produced intangible capital accounted for more than one fifth of the total capital stock of establishments. More than half of the intangible capital is R&D capital. This high proportion is mainly due t...

Determining the factors affecting economic growth for countries is of significant interest to the macroeconomist. In his classic article from 1956, Robert Solow proposed the model that has since become the modern standard for economic development models. His growth model, the Solow growth model, assumes a neoclassical production function with diminishing returns to capital, i.e. total income Y ...

Overview In this chapter we examine the relationship between increases in the capital stock and economic growth. We first discuss whether an economy can always grow if it increases only its capital stock. Under certain plausible assumptions, we show this is not possible, and that poorer countries should therefore grow faster than wealthy ones, whose economies will depend more on technological p...