Daehoon Nahm

Australian Banking Efficiency and Its Relation to Stock Returns

We used Data Envelopment Analysis to evaluate cost efficiency of Australian banks in producing banking services and profit between 1995 and 2002. Empirical results indicate the major banks have improved their efficiency in producing banking services and profit, while the regional banks have experienced little change in the efficiency of producing banking services, and a decline in the efficiency of producing profit. An attempt is made to relate the changes in efficiency to stock returns. Results indicate that for our sample, changes in firm efficiency are reflected in stock returns.

The determinants of profit efficiency of banks in Vietnam

This paper examines the factors that affect profit efficiency of banks in Vietnam over the period from 2000 to 2006. The effects of four groups of variables, including bank-specific characteristics, ownership, transitional environment and macroeconomic conditions on the profitability of banks, are analysed using a Tobit model to account for the censored nature of the efficiency scores. The model is estimated using a two-step instrumental-variable method as a regressor is endogenous. The findings show that the profit efficiency of a bank is enhanced by a larger size and better management ability, while it is hampered by low quality of assets and a too high level of capitalisation. High growth in per-capita GDP and a low-inflation rate provide a favourable environment for banks to improve their profitability. The study also finds that among the foreign banks operating in Vietnam, those headquartered in Australia, Japan, the US and Europe perform better than those headquartered in Asia as well as the domestic banks. Finally, the study suggests that in order to optimise their performance while remaining secure, banks should maintain the ratio of equity over total assets between 4% and 14%.

The Determinants of employment choice of rural migrant workers in China : SOEs and non-SOEs

Abstract Ownership structure is endogenous to the formation of the economic entity in China. This paper investigates the determinants of employment choice of rural migrant workers across state-owned enterprises (SOEs) and various subtypes of non-state owned enterprises (non-SOEs). Two self-selection models are adopted to comparatively identify how the unobserved factors related to the migration decision affect employment choice. Using pooled cross-section data for 1995 and 2002, results indicate that employment choice is positively selected with respect to the unobserved characteristics. Furthermore, wage and pension benefits exhibit positive relationships with the probability of employment in either type of enterprise.

Union wage effects in Australia: an endogenous switching approach

ABSTRACT Using data from the Household and Labour Income Dynamics Australia (HILDA), an endogenous switching model is employed to analyse union wage effects in Australia between 2001 and 2013. An advantage of this approach is that the decision to join a union is treated as potentially endogenous, a function of the wage differential between union and non-union workers, rather than exogenous as is the case in virtually all previous Australian studies. The article finds that the decision to join a union is highly sensitive to the wage differential between union and non-union workers. The article also finds that male (female) union workers with average union characteristics earn 12% (18%) more than male (female) non-union workers with average non-union characteristics. However, a decomposition analysis finds that this difference is due to union workers having better human capital endowments than their non-union counterparts. In addition, they also receive a lower return for those endowments. These decomposition results suggest that union wage effects in Australia may be negative, rather than the small positive effects typically found in the Australian literature.

The determinants of individual union membership in Australia: a structural approach using panel data

This paper uses The Household, Income and Labour Dynamics in Australia survey to estimate a structural probit model of the determinants of individual union membership. The paper finds that union membership responds positively to the wage differential between union and non†union workers. Consistent with other Australian and overseas research, we find that job rather than individual characteristics are the most important determinants of the probability of union membership. We contrast our research with previous Australian research from the 1980s when unionism was compulsory for many workers. We find significant similarity between the major drivers of individual union membership.

Employment choice and ownership structure in transitional China

This paper investigates the determinants of employment choice of rural migrant workers across state-owned enterprises (SOEs) and various subtypes of non-state owned enterprises (non-SOEs) by taking into account of the unobservable characteristics that link the choice to migrate with the choice of employer. Using pooled cross-section data for 1995 and 2002, the results indicate that the decisions for migration and the choice of employment are related, suggesting that estimating employment choices without considering migration status leads to biased estimates. We find that both higher paid wages and broader pension benefits are major determinants of employment choice. Of these, pension benefits have a larger impact than high-level wages in increasing the employment probability for either type of enterprise.

Skilled Immigrants' Contribution to Productive Efficiency

This paper studies whether skilled migrants contribute to the host countrys ‘productive efficiency’ (Farrell 1957) using input–output and immigration sectoral data for 7 industries in 12 countries during the period 1999–2001. We find that skilled migrants contribute positively to a countrys productive efficiency with the exception of the finance sector. The results broadly support the adoption of skill-biased migration policies.

The Effects of New Goods and Substitution on the Korean CPI as a Measure of Cost of Living

Abstract This paper estimates upper-level substitution and new-goods bias in the Korean Consumer Price Index (CPI) from the early 1990s to the mid 2000s. It has been estimated that the upper-level substitution bias in the CPI alone increased the inflation rate by 0.51 percentage points per year over the 13-year period between 1990 and 2002. The new-goods bias further increased the inflation rate by 0.17 and 0.13 percentage points per year between 1990-1995 and 1995-2000 respectively. The Chained Laspeyres index series that is based on annually-updated weights has been found to correct less than half of the upper-level substitution bias.