6 C’s of Communication

Challenge Statement Kindergarten students should transition from books that offer chants, songs and memorized text to books that offer an opportunity to build decoding skills, sight vocabulary and slightly more difficult text. Instructional/Learning model specified Six C's of Motivation will be used to expose the kindergarteners to diverse types of literature and to encourage a love of reading through the use of the Georgia Picture Storybook Award winners and nominees for the award. Explanation of Instructional/Learning model Students have been given the basic letters and letter sounds to learn with no choice. Now is the next step of turning the students into motivated readers. The 6 C’s of Motivation will be the ideal theory to put into practice with this next step. Choice – Giving the students a more challenging selection of books such as the Georgia Picture Storybooks award winners and nominees demands a large next step in enthusiasm from the student. A major reason for the program is to get students involved in reading without creating a scenario where failure seems inevitable. Students strive to meet a reading/learning challenge. Adding the next level of books to the classroom reading time and leisure time will help the students to focus on this reading goal. Challenge – Students strive to meet a reading/learning challenge. Adding the next level of books to the classroom reading time and leisure time will help the students to focus on their next reading goal. Control – When students are given a wide selection, and control over what topic of book to read then they feel like they have ownership in their task. If the topic of the book is interesting to them then they will be motivated to read and learn the new words. Collaboration – The kindergarteners enjoy their Book Buddy (5th grade students) time. Book Buddies will come in and select a book with their apprentice and take turns reading it to each other and discussing what is going on in the story. Constructive Meaning – If the MKO (Book Buddy/parent/teacher) shows an interest in the new level of reading books and find meaning in what is written then the student will also find meaning n the words, sentences and story. The student finds value in being able to read the story and find that others value what the students is reading to them. They need to be given an opportunity to write and speak what the story was about. Consequences – Students will be given the opportunity to share with their Book Buddy class the story that was read together. These opportunities to share what they read will include pictures and written text that summarizes the story. The event will conclude with an ice cream party. When students become motivated, they choose to practice reading books that are more and more challenging. The six C's of Motivation provides six concepts that could be applied to encourage the development of intrinsic student motivation. As they continue to improve, they become even more excited about improving their reading skills. This process repeats itself while teachers, parents, and book buddies (MKO) praise the kids on their progress. The Six C’s of Motivation is the best choice of theories to use in this type of reading development.

Linear Technology Essay

Linear Technology is a technology company that focuses on the different elements of semiconductors. The company mostly focuses on analog products within the semiconductor portion of the electronic industry. Linear Technology was unique in their payout policy in the sense that they started with announcing dividends and then continued onto repurchasing. Linear started dividends to gain the respect of investors as well as show that buying shares in the company of Linear was less risky than all the other technology companies. Additionally, they repurchase stocks to offset the employee stock options that the company had as a large component of the employee compensation, which helped Linear in the years of low or slow sales. As stated in the case description, Linear has a strong cash flow as a company. In the basis of the financial needs for Linear Company, as a whole they need to make sure they are able to cover the executive stock option costs, as well as their capital investment in the fabrications facilities. In the case it is stated that Linear spent $200 million for new analog fabrication facilities, so therefore that expense would be a large and important financial need. Additionally, they need to keep some money set aside for expansion in the future. Since they don’t appear to be focusing on acquisitions at this point in time, they do not need to consider that in the financial needs, however if acquisitions do appear in the future they will be needed to take under consideration. Companies are supposed to drive value by growing the value of the company and the stock or by returning cash to shareholders. In the case of returning case to shareholders, it would be recommended as long as it is in line with the future strategic growth plan. As far as this particular case, there is nothing that indicates a specific growth plan in the near future but it can be presumed to have some expansion in the future. Overall, it would be a good recommendation to return cash to shareholders as long as the executive stock options, fabrication investments, and strategic growth plans for the future have all be met. A benefit to paying out cash to shareholders is th at it shows strength in the company as a whole. By showing strength in the company, share prices in turn with will increase because investors seek higher dividends. Companies with higher dividends are seen are more valuable. A disadvantage to returning  cash to shareholders is if Linear is unable to meet their dividend rate, they will be greatly punished and penalized causing their stock price to rapidly decrease. Additionally higher dividend means less cash in the business for future growth, which limits possible expansions in the future. In the terms of tax consequences, they should be relatively minimal since most of their investments are short-term investments. Typically, in the business world, short-term investments usually only have a tax of 1-3% which is nominal compared to others. Linear would only be paying taxes on the cash on the interest earned, which again will be relatively small. If Linear Technology were to pay out its entire cash balance as a special dividend, they would increase their risk of financial distress costs by greatly tightening their financial flexibility; which may also create extra transaction costs for the company. The firm’s value would greatly decrease because by paying out the entire cash balance the company would be significantly diminishing their asset value. As shown in Exhibit A, the overall value of this action would decrease the firm’s value by the total cash times the rate of interest: $1,565,200,000 * (1+3%) = $1,612,156,000. With the special dividend, Linear’s share price will increase by the amount of the dividend paid out. Therefore, with the number of shares outstanding at 312.4 million, there will be an increase of $5.01/share as shown in Exhibit A. The current share price is $30.87, so with the special dividend, share price will increase by $5.10 to $35.97/share. Although share price and the value incurs changes with the payout of the entire cash balance, earnings and earnings per share remain the same. Earnings and earnings per share are not affected by the dividend payout. Another option Linear Technology has to exercise its excess cash balance, they can repurchase shares to increase the value of the firm. This repurchase option is beneficial to the company and shareholders because in an open market share repurchase has no effect on the stock price. In addition, by repurchasing shares the firm’s earnings and earnings per share will increase. As shown in Exhibit B, by calculating the total numbers of shares repurchased (total cash balance/price per share) and subtracting it from the number of shares outstanding will give us the number of shares left outstanding after the repurchase to be 261,703,052. Exhibit B shows how this decrease in the number of shares drove up the earnings per share value by $0.10 from $0.55 to $0.65. When the company repurchases shares instead of paying out in special dividends, the firm’s value will increase and it also allows the firm to retain its cash reserves within the company. In general, companies pay dividends for a number of reasons. Dividends provide certainty about the company’s financial well being. Many investors prefer the steady and secure income that comes with dividends and see dividends as strength in the company and a sign of future positive earnings. Dividend initiators tend to be large and stable firms with low growth rates but emit high profitability ratings. Typically a company is at the mature stage of their business cycles and in turn causes the company to generate a large amount of money in cash. Paul Coghlan should recommend to not raise the dividends but to initiate buybacks. Linear already as higher dividends rates than all of its competitors. As a whole, the company 5 cents while Intel was only at 2 cents per share after the dividends were diluted. Also, if the company were to raise dividends, it would have to be at a level in which they could maintain for a long period of time and Linear does not have the extended amount of cash that Intel, Microsoft, and Cisco have and none of those companies have dividends at the level of Linear. Overall, Linear should do another stock buyback because earnings per share would increase since there will be fewer shares which will bump up the value of the stock.

Tax law Coursework Example | Topics and Well Written Essays - 1000 words

Tax law - Coursework Example This paper will look at four different examples of taxes and explain these examples using scenarios (Amatucci, GonzaÃŒ lez, Trzaskalik and Amatucci 2006). The tax imposed on Brain’s family home and shop is classified as a capital gain tax. This is because the price at which he sold it was higher than the price in which he bought it plus all the commissions and the improvement cost. There is also the net rate of appreciation. He bought the empty premises ten years ago at 750 thousand dollars and started his business. He sold it at 1,880,000 dollars. The tax imposed here will be nominal based which implies that it will not change with inflation rates. Brain’s property will be taxed as a long-term capital gain since he has owned the property and business for over one year. The shop and land will be taxed at 15% to 20%. The trading stock, goodwill, and fittings may be exempted from taxation since they are long term gains acquired and are below the 20 percent mark of the total amount. Since Brain is married, and his wife has a 5% ownership in the company where Brain 45% and is worth 5.4 million dollars, the couple will be excluded a tax of up to 540 thousand dollars. The 20 thousand dollars, he received for signing an agreement of not establishing a business in a 10 kilometer radius of the property he sold, will not also be taxed. However, he has to stick to the agreement for five years to avoid a penalty on him. The tax imposed on income from property is either capital on general principles or income. In George’s case, the sale of trees at a cost of 20 dollars for each tree is classified as farm income since the trees are farm produce and are taxable under the farm income statement. This implies George will be taxed on a rate stipulated in the country that changes with time. In the second year, George will also be taxed on the 9

Final Exam Essay Example | Topics and Well Written Essays - 750 words - 3

Final Exam - Essay Example Peoplehood is the consciousness of the fundamental unity that makes a person a part of a society. Peoplehood matrix constitutes four basic principles, a consecrated history, a well-defined terrain, and the environment, a distinct language and a characteristic ceremonial cycle. This paper will look into these principles. Peoplehood features were attributed to socio-cultural, political, economic, and environmental behaviours of Cherokee inhabitants. They included the Cherokee Indians, Delaware, Natchez people and the Shawnee. Membership of Cherokee community entailed certain obligations that had to be met for one to participate in the continuation of a good life in Cherokee nation. For example, young men and women graduated to the elderly and diplomatic stature only after serving as warriors (Mooney 56). Cherokee nation had ceremonies that honoured and cared for the sacred fire analogous to the sun and a symbol of purity. Annually Cherokee people gathered to dance in a bright flame and dark shadows of everlasting fire and ask for help of the fire and the spirits. They believed that as long as the fire burned, Cherokee people were destined to survive (Mails 23). Several Cherokee ceremonies were performed, ceremonial lighting of sacred fire, sacrifice of tobacco or meat, purification of individuals ceremony, all night dances. Concisely, all the ceremonies were linked to the fire. There was danger of neglecting the ceremonies; they believed the spirit could affect the health and well-being of the individual who disobeyed the ceremonies (Kelley 23). Cherokee nation had towns each under the headship of chiefs and war leaders. There were two kinds of chiefs; white chiefs and war chiefs. The white chiefs were elderly and had a mandate to preserve peace. They were resourceful, experienced, and respected people. They also conducted the spiritual ceremonies and helped in conflict resolution (Wilkins 34). The war chiefs or group of warriors had specialized

Dell vs Hewlett Packard Essay Example | Topics and Well Written Essays - 2500 words

Dell vs Hewlett Packard - Essay Example Michael Dell, the founder of Dell Inc. who owns 10% of the common stocks, customers, suppliers and the stockholders are the major stakeholders. The global recession brought tough conditions on loans in 2008 as banks became more cautious about lending. Investors are also hard to find as the people do not have liquid cash in hand. Therefore it is hard to find investments for expansion in such conditions. The dollar has sunk in comparison to Euro to a new low and oil prices have risen to above 100$ per barrel. A depreciated exchange rate means that the imports cost higher to the US. Consumers are shopping conservatively and are trying to avoid shopping because of shortfalls in income and higher unemployment. The unemployment rate has plunged to 10% which means that every 1 in 10 American in unemployed. The consumer expenditure was down by 4.3% in 2008 since the last year. Youngsters, who are the main target market of Dell, are facing difficulties in finding jobs. This is because the companies are hiring more experienced and trained personnel instead of youngsters. This means that the target market of Dell has reduced income. The instability of government policies could affect the business environment in the US. Policy changes such as corporate tax rate and interest rates changes by the Fed could affect all the firms present in the US. The demand of data storage was on high as the use of computers increased. The demand was huge from the industrial side as there was a trend of recording and storing data in data drives. The consumers wanted high-speed data storages which ensure data protection and recovery features. Almost all the nations were going through a financial crisis in 2008 which forces the businesses in the global arena to cut down their costs in order to survive. This was forcing the companies to shift to cheaper options in the market such

Industry Research Paper Example | Topics and Well Written Essays - 1000 words

Industry - Research Paper Example Cinnamon Melts 4. Brownie Melts Beverages: 1. Inca Kola 2. Irn-Bru 3. Sodas 4. Milkshakes Chicken, Fish and Pork : 1. McChicken 2. McNuggets 3. Fillet-O-Fish 4. McRib 5. McArabia Breakfast: Breakfast sandwiches are the primary McDonald's breakfast's offering. McDonald's provide two styles of breakfast burritos, McDonald's breakfast also includes potato rosti, British bacon and hotcakes. Other Products: McDonald's also provide a wide range of sandwiches, Rice in Asia because the demand of rice is higher and many other products including salads etc. Market structure of McDonald's: McDonald's can be described as a part of a market which has perfect competition, and the competitors are just as huge as the way McDonald's is. Its competitors include Burger King, KFC, Hardees, Subway, Starbucks and other fast food restaurants. Most of the time McDonald's have to compete against the local restaurants of the country in which their franchise is operating, for example in Pakistan, OPTP and othe r local food vendors. For any business to stay ahead, in the competitive environment that it is facing, is a huge task. McDonald's is performing this task quite efficiently, as they promote product adaptation and provide their products on a relatively lower price. Furthermore McDonald's also provides different varieties for different people, based on age groups, occupation, and the region. McDonald's has built its success under the phenomenon of providing a wide range of standardized and high quality products, quicker and cheaper. McDonald's originated from USA, but now it is functioning in more 114 countries with over 25,000 restaurants, having a wide share globally is one of the reasons for McDonald's' success in the competitive environment. Nowadays one of the most valuable resources is time, people would more likely pay a lot to save their time. McDonald's provides its food quicker compared to its competitors, saving people's time. Most of the people prefer McDonald's over its c ompetitors because of the fact that McDonald's saves their time. Product adaptation is one of the major attributes of McDonald's. When McDonald's started to serve in India (elaborated later), a lot of people started to raise their voice against McDonald's, as the products included beef which is un-ethical towards the people of India, what McDonald's did was they stopped making beef related products in India, and started making products including mutton and chicken, an example of that is Maharaja Mac. Also, in Asia since the demand for rice is higher McDonald's introduced McRice. Because McDonald's practices product adaptation so much, it is quite successful compared to its competitors. McDonald's has a strong global presence and is considered as a leader in the domestic as well as the international competition. Even though McDonald's is leading the domestic market, still there are threats by the local food vendors, as people prefer the local food. To tackle this, McDonald's is intro ducing specific products for different regions, which has a local effect in it ("How does McDonald's compete in a monopolistic competition?"). Regulations that McDonald's must follow: Since McDonald's has a lot of franchises in different countries, therefore it has to follow the rules and regulations of that region. Keeping in view the ethics of that region, McDonald's should provide its services accordingly. Taking India as an example, as mentioned before when McDonald's sta

Definition of the Term Poor Essay Example | Topics and Well Written Essays - 750 words - 1

Definition of the Term Poor - Essay Example The conversation inevitably turned to the suitability of this individual to handle the task at hand. Keenly aware of the fact that someone was being judged in this matter, I listened closely for any determination; fully aware that whatever was decided would impact me specifically. What I heard was my mother and father agree that the woman was not suitable due to the fact that she was incredibly poor. At the time this made a large impact on me; as I realized that people’s abilities and talents could be classified with respect to whether they were poor or not. Within our entire culture, the term â€Å"poor† has taken on a highly pejorative meaning. Individuals are summarily grouped between those that can be classified as â€Å"poor† and those that cannot. As with many pejorative words, the actual meaning behind the word â€Å"poor† differs significantly from what is connoted when this word is so carelessly and continually thrown around by the likes of politi cians, news pundits, and stakeholders at every level within society. In seeking to understand this term to a more full and complete degree, the following analysis will consider the direct denoted meaning of the word as well as the connotations that it espouses within the current culture. Firstly, it must be understood that â€Å"poor† in its most basic denoted meaning merely involves the state of being without; and/or having a very small amount of something. Generally, this denoted meaning involves money or financial instruments of some variety. However, within the connoted meaning of the word, the societal participant is lead to understand that this involves a lack of education, propensity to crime, oftentimes even a certain socio-demographic. From the connoted and denoted meanings that have thus far been defined, it can be fairly securely understood what specifically defines â€Å"poor† within the current culture and society. Yet, it must also be understood that the term itself is incapable of defining many of the connoted meanings that have been referenced. As was described, the traditional definition has to do with material want; not personality traits and/or a proclivity away from education. These connoted meanings only act as a disservice to the way in which people understand what poverty and poor actual means. As a direct result of this misunderstanding, the definition of poor has come to take on a life all its own. One thing that should be manifestly clear, a topic that is not often discussed, is the fact that even though poor has a level of impact with regards to material possession, it cannot begin to define the level of skills, talents, ideas, creativity, passion, work ethic, motivation, or intelligence that a person has. Merely because poor can help to define the net worth of an individual in monetary terms should not be misconstrued to mean that it is somehow equally useful for delineating the overall net worth of a person physically , psychologically, emotionally or spiritually (Hom 391). By their very nature, humans seek to define and categorize information into easily understandable facts.  Ã‚  

Themes and Style comparison between Pans Labyrinth and The City of Essay

Themes and Style comparison between Pans Labyrinth and The City of Lost Children - Essay Example The themes of both the films have one thing in common; they are about dreams. The films show how important dreams are and especially of young children. In Pan’s Labyrinth, this theme is shown as the young girl has an imaginative fantasy world in which she lives and creates her own magical world. In her dream world, she is a princess and she sees people in the real world as annoying and distracting. It is her love for fairy tales that led her to go on an adventure where she was given the chance to become the princess she was and return to her father, the King. She was told that she was a born princess by a faun who she meets at the night in the forest. The rest of the film shows how the young girl accomplishes three gruesome tasks just to claim her royalty and her status as a princess. In The City of Lost Children, the theme of dreams is depicted as the old aging scientist kidnaps young children to steal their dreams. This theme is portrayed as children dream big and they have the capability to dream about their fantasies and their innocent world. The evil scientist starts stealing these dreams leaving the children empty and without their dreams. The children are lost without their dreams and they are kept in a secret place. The old scientist steals the dreams as he doesn’t have the capability to dream himself. It is also shown that the scientist is aging rapidly only because he doesn’t have dreams. The film shows how dreams keep us younger and give us the reason to live a life. The theme of evil is also somehow depicted in both the films as they are fantasy films and they show the evils which are associated with every good. The young girl in Pan’s Labyrinth is living her dream fantasy of being a princess and having royalty. However, her dream is disrupted by the evils that surround her. The fairy takes her to the forest where she is told she is a princess and in order to

Is Science a Religion Essay Example for Free

Is Science a Religion Essay Is science a religion? This topic has been debated by many creationists and scientists alike. The philosophy of science makes no claims to knowledge about the supernatural or metaphysical and, by not so doing, is left with an enterprise that although hugely successful is also permanently on trial (Manne, 2010). The only thing scientists can agree upon is the empirical nature of science, but the steps from observations to theory are not without philosophical problems. DISCUSSION Thomas Kuhn thinks that scientific paradigms are essentially pictures of the world that are consistent with observations and logically coherent. But such pictures are necessarily always incomplete, at least until such time as we know everything, and our minds seem to struggle to accept this; it seems like there is an aesthetic compulsion to create harmonious images, even if that means filling in the spaces with metaphysical constructs. Andrew Brown states that the dictionary is wrong; science can be a religion too. He explains that if you strictly use the dictionary definition of science then it cannot be considered a religion, but if you look at science objectively you can see how it could be considered one. He makes a strong argument that religion has too many definitions for science to not be considered one. Richard Dawkins believes the opposite. He states that science is based upon verifiable evidence. Religious faith not only lacks evidence, its independence from evidence is its main virtue. Dawkins makes a good argument for science not being a religion. He even goes so far as to reconsider his stance only if science can get as much education time as religion does. Dawkins’ Atheist views are widely known but there are many more scientists that believe religion has no place in the world. Michael Ruse, on the other hand, asks why religion is not being taught in public schools while science is. His argument is that if â€Å"God exists† is a religious claim, why then is â€Å"God does not exist† not a religious claim? And if Creationism implies God exists and cannot therefore be taught, why then should science which implies God does not exist be taught? I am sure Dawkins was referring to Sunday school and bible study when he referred to science getting as much education time as science, but Ruse has a valid point. Science is taught in schools due to separation of church and state, therefore everyone has to learn science. Sunday school is voluntary. Peter Harrison demonstrated how the role of religion in the rise of modern science often focused on the way in which religion motivated particular individuals, or provided the essential content of approaches to nature. These relate to the origins of science and assume that, once established, modern science becomes self-justifying. However, seventeenth century criticisms of science, such as attacks on the Royal Society, suggest that science remained unimportant for quite some time. The rise of science to cultural importance in the eighteenth and nineteenth centuries was possible only because science was eventually able to establish itself as religiously useful initiative. Religion played a key role not only in the origins of modern science, but in providing the ongoing social sanctions that ensured its persistence and rise to prominence. This is a concept I am sure Dawkins would not appreciate, yet it has merit. The relationship between Science and Religion can be explained from two discrete points of view. Some would argue that scientific explanations are the only means of explaining our existence, while others would argue that religion and the story of creation provide a sufficient amount of the worlds conception. Religion and science both have the same basis, which are truth and understanding. It is this similarity that allows a direct link between science and religion. I believe that there is sufficient evidence to prove that science and religion are compatible. Albert Einstein had the same opinion when he presented the idea of the nature of light that was argued for hundreds of years. Scientology is also a proven example of compatibility between religion and science. Also, when looking at the two from a more general point of view, it would be obvious to say that they can both work together to give us a better understanding of the universe. In the early 1700s, a constructive debate on the true nature of light led to various arguments and theories. The corpuscular theory, which was more religious based, depicted light being tiny particles that were transferred from a source like the Sun to a destination. A more scientific theory suggested that light was a wave phenomenon where the energy was carried by a wave motion and not by movement of actual particles. In the early 1900s, Albert Einstein discovered that light was both a wave and it was composed of tiny particles. He felt that both sides were right all along and both contributed to finding out the true nature of light. With this discovery, he felt that there was a strong link between science and religion. Science without religion is lame, religion without science is blind (Einstein, A). Saying this, he believed strongly in the fact that religion and science were compatible. He believed that religion was a byproduct of fear and a tool to help the primitive human mind deal with it. He believed that many leaders and rulers incorporated religion into their daily functions to secure their rule. The question â€Å"is science a religion? † still remains. The problem may lie in how science and religion differentiate in their distinct methodologies of searching for knowledge and belief. Science refers to a system of acquiring knowledge based on scientific method, it attempts to collect accurate information about the shared reality and to model it in a way that can be used to make reliable. They have concrete and quantitative predictions about events; everything has a hypothesis and has reasons to prove it. Science gains their knowledge through scientific method: testing hypotheses to develop theories through elucidation of facts or evaluation by experiments. It develops theories of the world which best fit the observed physical observed evidence. It can be categorized into two major types of sciences: human science and natural science and they rely mainly on empirical evidence. Religion is a set of beliefs and is related to both the personal practices related to communal faith and to group rituals and communication stemming from shared conviction. Theologians believe in the omnipotent power that God has, they put faith on God and use religion as a tool to satisfy their unanswerable questions and desire to know. Some religious people maintain that religious knowledge is absolute and infallible. However, the knowledge each person believes in varies as religious knowledge varies from religion and each individual. Science tends to be more tangible while religion is more imperceptible according to senses. There is domestic danger in being a world religious leader and technological powerhouse. Religious commitment and leadership in science and technology greatly enlarges the potential for conflict between faith and science in the United States. The relationship between religion and views of science should be of interest not just to scientists and social scientists concerned with public opinion research, but to policy makers as well. Public opinion has significant impact upon the making of public policy. Commonly held perceptions about particular scientific findings could help determine the eventual shape of laws and other policies for issues such as abortion or climate change (Keeter, 2007). Tradition has taught mankind that religion and science are two competing theories that can never be intermixed. Science and religion put forth competing theories on how the world was created, who is responsible for such creation, and what happens to individuals when they die. Further, science proposes solutions for many of society’s problems that many religions clearly define as wrong, such as abortion, stem cell research, and cloning. Early scientists and philosophers integrated science and religion to explain the course and state of the cosmos. For instance, Galileo, Kepler, Descartes, and Newton all asserted that mathematical relations, the foundation of science, were a product of God. According to the four, it was God who invented mathematics and then imposed mathematical laws on the universe to back them up. More than 100 years ago, William James remarked, â€Å"I do not see why a critical science of religions might not eventually command as general a public adhesion as is commanded by a physical science†. In James view, studying religion by way of science could shed more light on the issue than philosophy alone. James believed that philosophy fell short in that it failed to â€Å"capture the depth, motion, and vitality of religion†. By focusing on religion from a scientific point of view, researchers could better determine the concreteness of the religious experience. So, is science a religion? The answer is it depends on who you ask.  There is no concrete evidence to prove that it is or isn’t. I tend to believe that it could be. People like Richard Dawkins say emphatically no, yet he has blind faith that â€Å"what science cannot explain today, it will be able to explain tomorrow† (McGrath, pg. 148). Some have even gone so far as to compare Dawkins’ â€Å"infatuation† with Darwin with the Christian’s worship of Jesus Christ. I have not read anything that proves this but it could be another example of how science can be viewed as a religion. Either way, it seems that some level of faith is required for both and we can learn a lot from each one.

Helping Children Master the Basic Facts Essay Example for Free

Helping Children Master the Basic Facts Essay The chapter â€Å"Strategies for Multiplication Facts† provides detailed overview of strategies used for mastering and enlarging multiplication facts. It is suggested that basic facts may be improved due to relating existing knowledge to new facts. The author outlines five group strategies stating that the first four are easier and they cover 75% of multiplication facts. Nevertheless, it is noted the offered strategies are simply suggestions, not the rules to follow. Actually, these strategies help students think of various facts easily. The special attention in the chapter is paid to doubles, zeroes and ones, helping facts, division facts and ‘near facts’, etc. It is noted that fact remediation should be used in case when students are unable to master basic facts mentioned above. Such students need new approach to comprehend basic facts. Therefore, fact remediation is of great importance, because it aims at providing hope for students having problems with mathematics. Often students experiencing difficulties with getting facts, start thinking they are unable to learn facts at all. The author recommends to â€Å"let these children know that you will help them and that you will provide some new ideas that will help them as well†. (184) It is admitted in the chapter that students who comprehend the basic multiplication facts doesn’t reason better that student who find it difficult to get the idea of basic facts. The author states that nowadays the goal of mathematics isn’t simply to learn how to count, instead it aims at learning how to reason, how to make the sense of things around. What is more important, mathematics develops the skills of critical thinking and punctuality. Mathematics teaches students to solve problems and, therefore, students experiencing difficulties with mastering basic facts shouldn’t be excluded from mathematical experiences. Summing up, the author claims that all students should be involved in â€Å"exciting and meaningful experiences, they have real motivation to learn facts and real opportunities to develop relationships that can aid in that endeavor†. (185) References Van De Walle, John. (2003). Elementary and Middle School Mathematics: Teaching Developmentally. USA: Allyn Bacon.

An Introduction To Multiculturalism The Concept Sociology Essay

An Introduction To Multiculturalism The Concept Sociology Essay The definition of multiculturalism depends a great deal upon the context in which it is discussed. Concept of multiculturalism is constantly varying as more people make their voices heard to a recurrently increasing audience. Multiculturalism implies the diverse perspectives people develop and maintain through varieties of experience and background stemming from racial, ethnic, gender, sexual orientation and/or class differences in our society. Multiculturalism is the acceptance or promotion of various ethnic cultures. It is diversity valid to the demographic make-up of a specific place, often at the organizational level, e.g. schools, businesses, neighborhoods, cities or nations. In this context, multiculturalists advocate extending equitable status to distinct ethnic and religious groups without promoting any specific ethnic, religious, and/or cultural community values as central. Multiculturalism should preserve the ideals of equality, equity, freedom and respect for individuals and groups as a principle fundamental to the success of a nation. Background of British Public Life Style that embraces Multiculturalism the Evolution Britian is one of Europes most multi-cultural nations. There are a number of policy drivers and historical happening that have led Britian to evolve into multicultural society that it is today. There is no infliction of immigration in the 1914 and 1948 Nationality Acts. Immigration remained low, however until after 1948. In 1953 the total number of immigrants to Britain was 2000 and by the end of the first half of 1962 the number had risen to 94,500. The 1948 British Nationality Act established positive immigration rights to Citizens of Commonwealth countries. Britain experienced an increase in immigration rate in post war era due to deficiency of labor. Initially men alone came to Britain for jobs but in late 1960s and early seventies their families joined them. These included mostly Hindus, Sikhs, Muslims and Buddhists as well as Christians and they settled in London, in the Midlands and the North and in the seaport towns of Liverpool and Cardiff. The immigration load of 1960s and early seventies made UK an ethnically and religiously diverse community. The idea that the immigrant would ultimately merge and become part of the host culture which was given in mid-50s was rejected. These communities develop their own cultural values. Racial tension increased and by the end of 1950s immigrants were subjected to unprovoked racist attacks. This resulted in the notion that immigration and race relations were politically controversial issues and there was a growing campaign to introduce immigration controls. Between 1950 and 1955 certain control measures were adopted to reduce the influx to Uk as the number of West Indian, Indian and Pakistani immigrants increased. But in spite of the strict immigration policy the population of immigrants is still growing Over the last decade most of the immigrants came from the Indian subcontinent or the Caribbean, i.e. from former British colonies. In 2004 the number of people who became British citizens rose to a record 140,795 a rise of 12% on the previous year. This number had risen dramatically since 2000. The huge majority of new citizens come from Africa (32%) and Asia (40%), the largest three groups being people from Pakistan, India and Somalia. This resulted in changes to the British way of life and the UK became known as a multicultural community. However, more recently the term multiculturalism is becoming a contested concept both in sociological discourse and in recent policy making. The term multiculturalism is generally thought to have arisen in Britain in a speech by the then Home Secretary, Roy Jenkins in 1966. While this term is current in the UK there are often instances where local politics can serve to exclude minority cultures while promoting the values of the dominant white culture. Multiculturalism is also a term which describes aspects of social policy. Multiculturalism is used in a number of ways which can serve either to celebrate difference or to act as a cover for what, in any real terms, is another form of enforced assimilation. It also needs to be recognized that diverse ethnic groups now consist of large numbers of people who have been born in Britain. Causes for Reduction in Peoples Moral Value and Multi-cultural Understandings of Harmony in UK 1. Materialistic Lifestyles and Lack of Religious Influences Nowdays people are inclined towards economic advancement rather than social advancement on basis of sticking to the moral values. Simplicity has been taken over by extravagent life styles and extra needs. This brings human cirlce of behavior and brings about significant impact on the entire social fabric. There is lack of religious and spiritual influences on people, and they do not tend to believe in virtues and moralities. In the The Twilight of a Great Civilization, with reference to lack of religious influences on nations and consequent emergence of immoralities, Theologian Carl Henry stated that there is no fixed truth, no final good, no ultimate meaning or purpose, and that the living God is a primitive illusionà ¢Ã¢â€š ¬Ã‚ ¦ it champions mysticism, occult forces and powers, communion with nature and exotic religions. This concept of illusional God is taking up roots in various sections of British society. 2. Fragmented Family Structure A dysfunctional family is detrimental to the development of an individual and usually results in low self-morale. Among the numerous factors for the deterioration of morals among the youth, such as lack of religious education and appreciation and peer pressure, a dysfunctional family were stated as the leading causes. The family is the basic building blocks of society. Abuse whether sexual, physical, emotional, or mental is a very real and crippling problem in families today. Young adults, couples and elderly struggle with anxiety, depression, panic attacks, sex addiction, abuse, incest, sleep disorders, divorce, mid-life illness, death and many more problems. The family has dramatically changed over the last 30 years. This results in the deterioration of morals, values, beliefs, priorities, and life styles. Such disjointed social systems where an individual is so aloof from family would definitely show rejection and lack of trust to other members of the society especially those from alien cultures. Lack of harmony in family structures ultimately lead to lack of harmony in multi-cultural society. 3. Disillusioned Youth Young people are taught in our schools and colleges that ethics, morals, right and wrong depend upon the situation. Some teachers and professors use the concept of Values Clarification to inculcate students that their desires represent valid moral and ethical values. Many of these people have come of age and are among our highest leaders today. Morality is vital in all areas of society. It is the critical education young people obtain that imparts ethical values that endow with lasting benefits. Todays teachings produce mixed results. Name calling and bulling due to racism is prevalent in British schools and educational systems. This causes discomfort to students from other cultures and creates sense of disharmony. 4. Negative Messages by Media Billboards, magazines, TV commercials, music videos all portray messages of sex, violence and extravagant lifestyles. Blood gore horror flicks or action packed ones are all full of images of violence. Even video games have element of adventure by infusing streaks of violence by use of guns, explosives, daggers. These channels of exposure to voilence makes us prone to being emotionally insensitive, and enhance trends of agression, anger and violence in the society. Violent and aggressive trends call up for dis-harmony amongst various segments of multi-cultural society. 5. Racist Behavior Racists do not like foreign people who live in the UK, either as immigrants or as visitors. Racist behavior is more widespread in areas where there are many immigrants or in towns where there are many international students. Racist behavior implies the use of slang expressions. The British Crime Survey reveals that in 2004, 87,000 people from black or minority ethnic communities said they had been a victim of a racially motivated crime. They had suffered 49,000 violent attacks, with 4,000 being wounded. At the same time 92,000 white people said they had also fallen victim of a racially motivated crime. The number of violent attacks against whites reached 77,000, while the number of white people who reported being wounded was five times the number of black and minority ethnic victims at 20,000. Most of the offenders (57%) in the racially motivated crimes identified in the British Crime Survey are not white. White victims said 82% of offenders were not white. 6. Hatered Flared due to Terrorist Attacks According to a report by BBC race-hate crimes increased by almost 600 per cent in London in the month after the July 7 bomb attacks, with 269 more offenses allegedly motivated by religious hatred reported to the Metropolitan Police, compared to the same period last year.  [1]  Muslim community living in Britian becomes subjected to harsh attitudes because they are all believed to be from terrorist groups. Religious leaders of Muslim groups hold the view that government and race bodies for pursuing a policy which, he claims, has alienated Muslims. These views were stated to be absurd by the Commission for Racial Equality. This rift between those representing Muslim community and the Commission for Racial Equality reflect a deep set sense of opposing views. Suggestions to Enhance Understanding and Harmony amongst Various Sections of British Society Media Propagation Media can play a vital role in promoting peace and harmony oriented messages. Role of Educational Systems Children and students should be taught respect and tolerance for other cultural and religious trends prevalent. They must be taught to tolerate and accept rather than to retaliate and reject. Students from different ethnic backgrounds should be encouraged to share knowledge about their cultural heritage, and the teacher can add the element of fun and interactive learning in the whole process, so that the students affiliate positivity with this exercise. At higher educational level, knowledge can be shared on wider platforms through tutorial, or intellectual discussions. Role of Government and Legal Bodies Fair and transparent government mechanisms, policy making, and legal framework. Human rights should be followed rigidly and justice should be available to all regardless of color, race or religion. Role of Peace Organizations Various organizations can come into play to drive peace and harmony campaigns. For example, Peace Boat has been active in the field of education for peace and sustainability through the organization of educational voyages, based o ­n lectures, workshops and study-exchange programmes both o ­nboard the ship and in ports of call. Their Global University and International Student (IS) programmes provide innovative approaches to peace and sustainability-related studies through intensive learning onboard and direct exposure to issues in various countries. Equal Opportunities and Freedom to Express Cultural Values Government should ensure equal opportunities regarding availability of basic necessities, housing, education, health care, employment should be available to all the communities and social stratas of UK. People should not feel awkward to expressing their cultural norms in anyway. Law should be made flexible to allow people to wear hijabs and veils (Muslim women), turbans (Sikhs) etc at work and educational places. Government should ensure that the performance of various religious cultural activities and festivals are not hindered in any way. Changes at Individual Level At the end of the day all these suggestions can add up to be nil if each one of us individually fails to take others as they are. Each one of us must work and evaluate our holistic approach of going about things. No one can compel us to exhibit tolerance or respect towards other communities unless we feel the need to do so within ourselves. The question might be: Why the need to change anyway? The answer: Change for a secure, peaceful and brighter tomorrow! Policy Areas to be covered by Government to Promote a Multi-cultural Society In UK 50 years ago, when for the first time the effect of mass immigration was experienced, the need for policy, political and legal changes was felt. With this the concern of the Government was to integrate and assimilate the incoming groups into host communities. Policy making is very crucial as it can help in formulating policies which helps in determining the representation which various ethnicities receives in television or press. It helps in determining the code of conduct for these communities, the dress code, and content of education, the freedom for observing religious holidays and to celebrate festivals. With the years Multiculturalism has initiated many disputes but the The UK Government has focused less on establishment of multicultural policy and more on issues of inclusion and cohesion. While it was principally ignored under Margaret Thatchers Government the success of New Labor has meant that the term has grow to be a common currency in political debate and in policy making. In 1997 the ODPM was given task for a social exclusion unit which aims to embark on research into a number of different areas. Social inclusion and cohesion are not just used in relation to diverse ethnic groups but are the basis for policy making in a number of other areas such as mental health, early years education and homelessness. Issues of inclusion cover a host of areas and can range from the numbers of ethnic minorities using childcare facilities, to those undertaking further education of some kind to increase their employment prospects. Policy making aimed at reducing inequalities in both the labor and the housing market. In order to be successful anti-racist strategies need to be multi-faceted and aimed at subjective, institutional, and structural racism. Past policies have been deficiently focused because there is no clear consensus in Britain what equal opportunity and multiculturalism mean either in ideological or practical terms. According to a Policy Studies Institute (1982) report found that in the majority of diverse ethnic communities rates of unemployment were twice as elevated among these groups as they were in the governing host group. There is a continuing disparity in terms of wages, exclusionary modes of hiring and higher unemployment rates, certain ethnic groups experience greater success in the labor market than do others. Housing policies also tend to discriminate against asylum seekers/refugees and other diverse ethnic groups. Clearly there are problems in the categorization of diverse ethnic grou ps and in present policy making, which, instead of greater inclusion sometimes tends to further leave out such groups. In the light of above mentioned scenario of policy decisions and proceedings, it is suggested that to sustain and promote a healthy Multi-cultural Society the Government should address the following policy areas: 1. Economic Policy Areas Economic policies should attract intellectual capital, trade, skilled migration, education, tourism, and science/technology. Establish partnerships between government agencies and business, industry, tourism, and education sectors to promote and maximize the economic advantages of cultural diversity and promote the State as a destination to work and live together. Develop supporting strategies for multiculturalism in international relations, tourism, trade and export areas. Develop educational and promotional activities to increase awareness of the economic benefits of multiculturalism. Develop strategies in the public sector to better capture the benefits of a diverse workforce. 2. Policies to Support Communities Policies should be developed for funding and investing in communities to further multiculturalism through research, policy development, advocacy, community awareness, festivals, services, projects and networks. Policies should be formulated in consultation with agencies and stakeholders in the community and across government on multicultural affairs. 3. Policies to Strengthen Multiculturalism in the Public Sector Government agencies should ensure that regardless of cultural and linguistic backgrounds, all communities have equal access to services. 4. Policies to Strengthen Community relations and anti-racism Policies should be designed for strengthening the sense of belonging in their local environment and in the global community. Policies should be taken up to promote positive and cohesive community relations across the whole community through a renewed community relations plan. 5. Policies to Develop Multicultural Education in British Schools Educational systems should be developed keeping in view the requirements and cultural backgrounds of students coming from various backgrounds. Methods of teaching and interaction should promote multi-cultural harmony amongst the students. 6. Policies for Equal Opportunities Policies should be developed to eunsure that people from all communities have equal access to basic necessities, housing, education, health care, and employment Transparency in Government Operations Transparency in government operations will definitely bring in good understanding between different sections of society. In principle, a basic requirement for transparency in the overall structure and functions of government is a clear demarcation of the boundaries between the public and private sectors and, within the former, between different levels of government with respect to the state enterprise sector.  [2]  Transparent government operations would mean sound government policies, administrative frameworks, finances, good governance, and overall fiscal integrity. Transparent government operations would be accountable to all the communities dwelling in the UK. It would clearly distinguish provision of rights, protection by law and facilities by the government to the people. This would cumulate a sense of justice and equality in the society and hence promote greater level of social security and harmony. Role of Public in Promoting Harmony and Understanding Public can play a major role in promoting harmony by abiding by the law and respecting multicultural policies. As discussed earlier each one of use must develop a sense of tolerance and respect for other members of the society. Public can actively participate in other communities cultural activities and not only promote a sense of harmony but also learn about other cultures. At homes parents must teach their children how to respect and deal politely with foreign children at schools. At work place, shopping malls, community centers we must learn to respect and treat all members of the community equally. *********************** REFRENCES: Giddens, A., Sociology, 2001, 4th Edition, Cambridge, Polity Press. Skellington R. and Morris, P., Race in Britain Today, 1992, London, Sage. Braham, P. Rattansi, A. and Skellington, R., Racism and Antiracism, 1982, London, Sage. The Roots of Multiculturalism, Retrieved on 21st March 2010, from : http://www.law-essays-uk.com/free-essays/multi-culturalism-in-social-policy.php Winnail, Douglas S., Moral Decline Ahead, 2002, Volume 4, Issue 4, Retrieved on 19th March 2010 from : http://www.tomorrowsworld.org/cgi-bin/tw/tw-mag.cgi?category=Magazine19item=1104106519 Daniel, Finaz and Begawan, Bandar SeriConcern over decline in moral values, February 21, 2008, The Brunei Times, Retrieved on 20th March 2010, from : http://www.bt.com.bn/en/home_news/2008/02/21/concern_over_decline_in_moral_values Racism, UK Student Life 2002-2009, Retrieved 19th March 2010 from : http://www.ukstudentlife.com/Personal/Safety.htm#Racism Racism in the United Kingdom , Retrieved 19th March 2010 from : http://en.wikipedia.org/wiki/Racism_in_the_United_Kingdom#cite_note-3#cite_note-3 Freeman, Simon, Britain urged to wake up to race crisis, The Times, September 22, 2005, Retrieved on 20th March 2010, from: http://www.timesonline.co.uk/tol/news/uk/article569491.ece Muslims alienated by UK policy, October, 2001, Retrieved on 20th March 2010 from : http://news.bbc.co.uk/2/hi/uk_news/england/1630513.stm Tatsuya, Yoshioka and Mari, Kushibuchi, Education for Peace Sustainability, Peace Boat, Retrieved on 19th March 2010 from: http://www.peacefromharmony.org/?cat=en_ckey=240 Braham, P. Rattansi, A. and Skellington, Racism and Antiracism, 1992, London, Sage. Solomos, J and Back, L., Racism and Society, 1996, London, Macmillan Press. Modood, T. and Berthood R., Ethnic Minorities in Britain Diversities and Disadvantage, 1997, London, PSI. Multicultural Queensland making a world of difference, 2004, Queensland Government Multicultural Policy, Retrieved on 21st March 2010 from http://www.multicultural.qld.gov.au/media/maq_making_world_difference_policy.pdf Transparency in government operations, Retrieved on 20th March 2010, from: http://www.questia.com/googleScholar.qst;jsessionid=LyCV9MlnLPYpsTFdkCRBW0jF039GFrJhRMnS6WNP54VSvCvQ9M1G!144947719!-2000885492?docId=5001407337

The Impact Of Online Communities On Physical Social Relationships Essay

Abstract Nowadays, people spend much time in online communities to network with virtual friends and play role plays. They provide an advantage for people with special needs who cannot leave the house, because they benefit from the accessibility of the internet. Moreover, they help people who often move to stay in touch with their friends. Nevertheless, spending too much time in online communities leads to drawbacks in the development of the user’s personality. More energy is dedicated to the virtual life than to real life and people lose track of their personalities while busy building online ones. Also, frequent users of online communities have difficulties beginning meaningful real life relationships. Virtual friendships are shallow due to the physical distance and the anonymity of the internet and it is common to have more friends than you are able to care for. Therefore, it is more rewarding to invest into physical relationships. Virtual friendships Danger of online communities Anonymity of internet The Effects of Online Communities on Physical Social Relationships Introduction Meeting for an after-work drink at the pub, going to yoga classes twice a week and having coffee with the ladies afterwards, organizing events for your local church community – all of those are only examples of what you can do with friends. At all times, relationships consisted of activities and common experiences which form an unforgettable bond between people. Sharing a memory gives a feeling of belonging and is something that can be laughed and talked about still a long time after the experience. However, times have changed. Nowadays, it seems to be common to solely communicate with people over the internet. First, there were... ...20, 2008, from http://family.jrank.org/pages/660/Friendship-Benefits-Friendship.html Lovenberg, F. von (2007, November 10). Und wann steigen Sie aus? [And when will you drop out?]. Frankfurter Allgemeine Zeitung, 262, Z1. Scribner, R. (2007, June 11). ‘Second Life’ presents societal dangers. Retrieved April 21, 2008, from http://media.www.reflector-online.com/media/ storage/paper938/news/2007/11/06/Opinion/second.Life.Presents. Societal.Dangers-3079650-page2.shtml Second Life. (2008). What is Second Life?. Retrieved April, 8, 2008, from http://secondlife.com/whatis Warford, H. (n.d.). Virtual vs. real communities [Msg 5]. Message posted to http://www.theinstitute.ieee.org/portal/site/tionline/menuitem.130a35585 87d56e8fb2275875bac26c8/index.jsp?&p Name=institute_level1_article& TheCat=1021&article=tionline/legacy/inst2007/may07/marketplaceques.x ml&

The Witches in MacBeth Essay examples -- Macbeth essays

The Witches in MacBeth      Ã‚   Shakespeare utilized many sources of information when writing his plays.   One of his sources for the witches in MacBeth was almost certainly Reginald Scot's The Discoverie of Witchcraft, published in 1584.   In his book, Scot refuted many of the common notions regarding witches and their powers; nevertheless, the book created a basic outline for the typical witch, including physical descriptions and abilities.   The witches in MacBeth are representations of those described in Scot's book.   In the play, Shakespeare describes authentic witches in their physical appearance and behavior and MacBeth's character is made more villainous through his association with these terrifying figures.    Scot describes witches as being "women which be commonly old, lame, blearie-eied, pale, fowle, and full of wrinkles...They are leane and deformed, shewing melancholie in their faces, to the horror of all that see them" (Scot 4).   Basically, witches were thought to be poor old women with hideous appearances.   Shakespeare obviously picks up on this notion, as the witches in the play are described as ugly old hags.   During their first encounter with MacBeth and Banquo, Banquo is clearly appalled by their appearance and questions whether they are human: "What are these, / So withered, and so wild in their attire, / That look not like th' inhabitants o' th' earth" (1.3.40-42).   From Banquo's description, it seems they are poor, as evidenced by their clothing, and old and unattractive because of their vile and wrinkled appearance.   MacBeth later addresses them as "secret, black, and midnight hags" (4.1.48).   This phrase also suggests that they are old and ugl y women.   Thus, these women fit th... ...ers.   MacBeth is the only character to become closely associated with the witches.   He acts on their revelations of the future, whereas Banquo does not.   In allying MacBeth with the witches, Shakespeare makes MacBeth seem even more evil.   After all, the witches are the devil's servants, and by associating with the witches, he is indirectly associated with Satan.   Therefore, it would have been very easy for Shakespeare's audience to find him just as appalling as the witches themselves.   Thus, one of the reasons for writing the witches into the play was to make MacBeth a more despicable villain.    Works Cited Scot, Reginald. The Discoverie of Witchcraft. Montague Summers Ed. Dover Publications: New York,   Ã‚  Ã‚   1972. Shakespeare, William. MacBeth. Barbara Mowat and Paul Werstine Ed. Washington Square Press: New   Ã‚  Ã‚   York, 1992.

A Woman’s Place Is In the Home Essay

The saying â€Å"A Woman’s Place Is In the Home† seems extremely provokative to me. I refuse to accept this idea. I strongly believe that a woman should develop some professional skills and have a job. Anyway, the question ‘to work or not to work’ is quite often raised in many families because the issue is not so clear. In my presentation I’d like to dwell on the advantages and disadvantages of the situation in which a woman has to combine family and career. I will start with the drawbacks the family may suffer from. I’ve singled out 5 of them. 1. It’s very hard sometimes to juggle family and career. A woman experiences lack of free time, lack of sleep which may lead to stress and problems with health. 2. A woman may start paying less attention to her husband and her children. As a consequence, they may get dissapointed, they may even feel that their wife and mother doesn’t love them any more. 3. Because of stress a woman may start pouring all her worries to her spouse thus irritating him. It may result in divorse. 4. A woman may retire into herself and her career thus provoking the possibility of adultery on her husband’s part who may seek endearment elsewhere. 5. In case a woman’s career is more successful than that of her spouse it may put a strain on the marriage. Some men just can’t put up with the fact that their wife earns more than they do. Now I will pass to the benefits which the family may have if a woman works. I’ll mebtion 10 of them. 1. Financial aspect – more income. 2. A woman’s self-esteem and fulfillment are developed.   3. Communication with other people beyond the family circle meets social needs of a human being. 4. Family relationships become more balanced, a husband respects his wife, doesn’t reproach her. Equality. 5. A woman feels more affection and love for her family because she misses them. 6. Children become more independent with an internalized sense of responsibility. 7. A woman becomes better groomed and better dressed thus feels happier. 8. Social benefits (insurance policy, social security). 9. Financial independence. A woman becomes a productive and contributing member of the family. 10. A job generates self-discilpline, sets order in life and makes a woman a perfect time-manager. Summing it all up I’d like to  say that I’m absolutely convinced that the benefits mentioned above prevail all the disadvantages. It worths taking risks and truing at least. In my opinion a woman’s place is not only in the home because a woman is a much more talanted and gifted creature than many men believe.

Summary on Mikhail Bakhtin’s “Problems of Dostoevsky’s Poetics”

FR 511 – Bakhtin (Day one) Summary The subject of our October 29th lecture was Mikhail Bakhtin and his text â€Å"Problems of Dostoevsky’s Poetics. † To start the class, Dr. Wall reminded us that Laura talked about polyphony in her presentation the week before, and that that was where we would start the lecture on Bakhtin. To help the class better understand the concept of polyphony, we were shown a piece of music written by Bach: â€Å"No. 4 of 6 little preludes. † In the piece, the right hand was singing something completely different than the left hand. There were in fact two completely different melodies happening at the same time.We were told that, in Romantic music, there is one central melody, and the other instruments are there solely to accompany it. Their job is to reinforce the melody. But with older music, we see that it is possible to have more than one melody at a time, sometimes even four or five. You can listen to one melody at time or both at once, etc. This example of polyphony in music is basically a metaphor for the way that Bakhtin understood Dostoevsky. In classical literature, the text is dominated mainly by the voice of the narrator, and everything else simply reinforces what the narrator has to say.With Dostoevsky, this is not the case. That is the first important point to remember in understanding Dostoevsky’s poetics. According to Bakhtin (not Amy), Dostoevsky is the author of the first polyphonic novel. At this point Dr. Wall stated that Dostoevsky is really just a foil and that other authors could be substituted (Diderot for example). Again, coming back to the first main point in understanding Dostoevsky’s poetics (or Diderot, etc. ), one has to imagine a type of literature where the narrators voice is no longer all powerful and no longer dominates the entire text.Furthermore, Russian orthodox theology also had an influence on Bakhtin. In the same way that God created man to have free will, the author creates the literary character to have his own free will. In fact, one of the great splits in Christianity is over the doctrine of free will. Some believe that whether or not you will enter heaven after you die is not determined by you, but rather by fate or God, etc. On the other hand, there is the doctrine of free will which basically states that when God created man, he gave him the ability to be â€Å"bad† and to have his own free will, even if it destroys him.This is the same idea as the literary character being free to disobey the author. The underground man is an example of the free will of the literary character. He contradicts everything, he says one and one makes three. From there, we talked about the importance of multiple voices in a novel. These other voices in are just as significant as the narrator, and can even at times contradict what the narrator says. This is what Bakhtin calls the Copernican revolution. Evidently, Copernicus knew that the earth revolves around the sun.So what Bakhtin is saying is that the narrator is no longer the centre of the novel, but that there can be multiple centres. The second important point to know in order to understand Dostoevsky’s poetics is the concept of dialogism. Dialogism refers to the idea that in every utterance, there are other utterances that you may or may not hear, but that you have to learn to listen to. To illustrate this point, Dr. Wall started with the example of European languages such as German where you often use the second person to speak to yourself. An example is when Dr.Wall says, â€Å"Great move Anthony. † Bakhtin says that when we speak, there’s always a â€Å"tu† out there. Whether it is explicit or not, language is always a dialog. From there, we talked about how, for Bakhtin, language does not belong to anyone. The words we use to express ourselves are not our own, we are just one voice amongst the millions that language is. When we learn a language, we learn it from other people. When you express yourself, you are expressing yourself in a language that you borrowed from someone else. Naturally there will be traces of that someone else in what you say.It is crucial to remember that in your own desire to express yourself, there are other voices inhabiting your own voice. Not just the words, but the whole idea of discourse. It is in the flow and use of language. When you hear a single utterance, you can sometimes here the other utterances that are hidden, or the traces that were there before. And when you speak, all of these voices are going on at the same time, like an orchestra. So in a polyphonic novel, underneath the words you read, you have to learn to listen to the other voices that are hidden.So concerning this idea of dialogism, Bakhtin is interested in the interaction between voices, but not in dialog itself. For this reason, he hates theatre and lyrical poetry. He believes that they cover up what is really h appening underneath. Theatre for him is too explicit because the actor is given one specific role or one single voice to play. This takes away the resonance that you have in a polyphonic novel. Another important point is that, for Bakhtin, the coexistence of multiple languages is crucial for the birth of the modern novel.He grew up in Russia where about four languages were spoken in the same community, so he was very much interested in the phenomenon of periods of time where more than one language were spoken in the same community. After the break, we looked at specific examples from Bakhtin’s text. On page 197, he writes about the idea of hidden dialogicality. In other books he gives the example of a telephone conversation where you can only hear one half of what is being said. Even though you can only hear one person speaking, you have a pretty good chance of reconstructing what the other person is saying.There are an incredible amount of words out there, and the actual sou nd prevents you from hearing the invisible sounds. The second necessity for the birth of the modern novel according to Bakhtin is silent reading. The most important characteristic of polyphonic prose is that it is meant to be read silently. For Bakhtin, when you read out loud, you are obliged to choose only one voice. Therefore, the other voices get lost. He encourages you to read a passage multiple times in order to hear all of the voices that are present. Parody is also a prime example for Bakhtin.You think you are hearing a single voice, but there are actually at least two: the original and the parody. He says that that is what a great novel does all of the time, as opposed to theatre that he believes is more of a dialog. Of course, he was not familiar with modern theatre where actors play multiple roles. On page 187, Bakhtin writes about direct referentially oriented discourse. He explains that meaning for him (and Saussure as well) does not come from the referential relationshi ps of what we say, but rather because other people have said it. In other words, everything we try to think about has already been said â€Å"15 times† before.Then on page 195, we discussed the fact that when you hear a sound, it is physically not the same when you hear it alone as when you hear it with other sounds. It is the same thing with coulour. When you take it out of its context, it becomes artificial. Dr. Wall then gave the example of Obama versus Romney, and how they would twist the other person’s words to have a different perspective. The same thing is happening in the literary text and in regular discourse as well. For example, when someone says â€Å"the wall is such a beautiful shade of green† someone else might respond â€Å"beautiful shade of green!? The meaning of the utterance changes because of the question, but you hear the first statement at the same time. We concluded the lecture with this idea of the importance of the notion of the uttera nce. This helps us to understand that repeating utterances either adds or takes away from them. It is possible to repeat a word, but not an utterance. The repetition of madness for example, changes when you repeat it as an utterance (with the time period for example). The last thing mentioned was that, even with a machine meaning changes due to the simple fact that the utterance has been repeated. Joey Pihrag

Cooperative Banks

WP/07/2 Cooperative Banks and Financial Stability Heiko Hesse and Martin Cihak  © 2007 International Monetary Fund WP/07/2 IMF Working Paper Monetary and Capital Markets Department Cooperative Banks and Financial Stability Prepared by Heiko Hesse and Martin Cihak1 Authorized for distribution by Mark W. Swinburne January 2007 Abstract This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy.Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. Cooperative banks are an important, and growing, part of many financial systems. This paper empirically analyzes the role of cooperative banks in financial stability. Contrary to some suggestions in the literature, we find that cooperative banks are more stable than commercial banks. This finding is due to the lower volatil ity of the cooperative banks’ returns, which more than offsets their lower profitability and capitalization.This is most likely due to cooperative banks’ ability to use customer surplus as a cushion in weaker periods. We also find that in systems with a high presence of cooperative banks, weak commercial banks are less stable than they would be otherwise. The overall impact of a higher cooperative presence on bank stability is positive on average but insignificant in some specifications. JEL Classification Numbers: G21, P13 Keywords: financial sector stability, cooperative banks, commercial banks, savings banks Author’s E-Mail Address: [email  protected] org; [email  protected] rg 1 We are indebted to Klaus Schaeck for useful discussions during the early stages of the project. We also thank the following for their comments: Edward Al-Hussainy, Thorsten Beck, Ralf Elsas, Wim Fonteyne, Francois Haas, Patrick Honohan, Plamen Iossifov, Alain Ize, Barry Johnston, Luc Laeven, Eduardo Ley, Andrea Maechler, Paul Mills, John Muellbauer, Miguel Segoviano, Mark Swinburne, Alexander Tieman, and participants in an IMF seminar and a conference entitled â€Å"Public versus Private Ownership of Financial Institutions† in Frankfurt in November 2006. Contents Page I. Motivation and Literature Overview †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 3 II. Data and Methodology †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 6 A. Data †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 6 B. Measuring Bank Stability†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ C. Methodology †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 8 III. Results†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 11 A. Decomposition of Z-Scores and Correlation Analysis †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 11 B. Regression Analysis †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 14 IV.Conclusions and Topics for Further Research†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 18 References†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 35 Tables 1. Summary Statistics of Bank-Specific Variables in the Sample, 1994–2004 †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚ ¬ ¦ 20 2. Decomposition of Z-Scores for the Full Sample, 1994–2004 †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 21 3. Decomposition of Z-Scores for Selected Countries, 1994–2004†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 2 4. Sensitivity of the Z-score Decomposition†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 23 5. Fitch: Long-Term Ratings: Distribution of the Banks in Sample†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 24 6. Correlation Coefficients between the Z-Score and Selected Key Variables, 1994–2004†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 25 7. Regression Results (Full Sample)†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 6 8. OECD Regressions with Governance Variable †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 27 9. Regression Results (Large Banks) †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 28 10. Regression Results (Small Banks) †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 29 11. Robust Regressions†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â ‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 30 12.Quantile Regressions (Full Sample) †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 31 Figure 1. Cooperative Banks: Retail Market Shares in Selected Countries†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 3 Appendix I. Data Issues†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 32 3 I. MOTIVATION AND LITERATURE OVERVIEW Cooperative (mutual ) banks are an important part of many financial systems. 2 In a number of countries, they are among the largest financial institutions when considered as a group.Moreover, the share of cooperative banks has been increasing in recent years; in the sample of banks in advanced economies and emerging markets analyzed in this paper, the market share of cooperative banks in terms of total banking sector assets increased from about 9 percent in the mid-1990s to about 14 percent in 2004. Cooperative banks are particularly numerous and large in Europe. The five largest cooperative banks in the European Union (EU) rank among the EU’s top 25 banking groups in terms of consolidated equity.Reflecting the cooperative banks’ focus on retail banking, their market share in retail business is even more substantial: for example, five EU member countries have more than a 40 percent market share of cooperative banks in terms of branch networks (Figure 1). In non-European advanced economies and emerging markets, the share of cooperative banks is generally lower, but there are several countries where they play a non-negligible role. 3 Figure 1. Cooperative Banks: Retail Market Shares in Selected Countries 70 Percent of all branches 60 50 40 30 20 10 Netherlands Finland Germany Portugal 0 Austria France Spain Greece ItalySource: OECD’s Bank Profitability Report; and authors’ calculations. We use the term â€Å"cooperative bank† to include also credit unions. The main distinctive feature of credit unions is that their customers are identical with members. In other cooperative banks, not all customers are members. For more background on institutional history and structure of cooperative (mutual) banking, see Fonteyne (forthcoming) and Cuevas and Fischer (2006). 3 2 4 The importance of cooperative banks—and in particular the implications of their specific nature for financial stability—has not yet received appropriate attention in the emp irical literature.The literature devotes disproportionately little attention to cooperative banks in comparison with commercial banks, smaller than would correspond, for example, to their market share. For example, only about 0. 1 percent of all banking-related entries in EconLit, a major database of economic research, relates to cooperative banking. 4 This contrasts with the share of cooperative banks, which account on average for about 10 percent of banking system assets in advanced economies and emerging markets, reaching as much as 30 percent in some countries in terms of assets (and even more in terms of branches—see Figure 1).Most of the EconLit entries devoted to cooperative banks deal with specific country cases or with issues relating to efficiency rather than those relating to financial stability. For example, Brunner and others (2004) analyze revenue and cost efficiency of cooperative banks in France, Germany, Italy, and Spain, finding that cooperative banks are no t less effective at managing revenues and costs than commercial banks. The regulatory framework, including the recent amendments, is also generally designed with commercial banks in mind.For example, the third pillar of the New Basel Capital Accord (Basel II)—which relies on extensive disclosure to ensure that banks are subject to market discipline—has significantly reduced effectiveness in the case of cooperative banks (Fonteyne, 2007). Cooperatives’ disclosure practices and requirements are substantially below those of commercial banks, especially listed ones. Even if disclosure were adequate, there are rarely markets that could exert effective disciplining pressure.Shareholder pressure cannot be relied upon and cooperatives do not rely much on interbank markets or debt issuance as sources of funds. Finally, loyal and insured retail depositors are not likely to exert an effective market disciplining effect either at an early enough stage. Macroprudential work on financial systems, such as the IMF’s Financial System Stability Assessment reports (FSSAs), Article IV staff reports, and the Global Financial Stability Report, as well as reports on financial stability published by central banks (for a survey, see Cihak, 2006) pay relatively little attention to cooperative banks.Fonteyne (forthcoming) cites the FSSAs for France and Germany as two reports that devoted some attention to cooperative banks; however, the references to cooperative banks in those reports focused on mutual support and deposit insurance mechanisms, efficiency, and financial sector consolidation issues, rather than on financial stability implications.Several authors have noted in passing the potential of cooperative banks to increase the fragility of financial systems. For example, commenting on a finding by Barth, Caprio, and A search of the EconLit database was carried out on June 15, 2006, looking for all entries that had â€Å"banks† or â€Å"bankingâ⠂¬  among keywords or in the abstract. A search was then run for those that referred to â€Å"cooperative banks,† â€Å"cooperative banking,† or â€Å"mutual financial institution(s). † 4 5Levine (1999) that a higher degree of government ownership of banks tends to be associated with higher fragility of financial systems, Goodhart (2004) interprets this result as perhaps indicating that the presence of any non-profit-maximizing banking entities may make financial systems more fragile. Goodhart does not elaborate on the underlying mechanism of this relationship between the presence of non-profit-maximizing entities and financial stability, but possible mechanisms are not difficult to envision in the case of cooperative banks.Cooperative banks’ stated objective is not to maximize profits, but rather their members’ consumer surplus; this is in some cases complemented by additional objectives that seek to contribute to the well-being of stakeholders o ther than member-consumers, such as employees. 5 If a cooperative bank’s pursuit of objectives other than profit maximization results in very low profitability, its balance sheet risks grow faster than its capital, leading to deteriorating solvency.If cooperative banks accept lower profitability as the price to pay for delivering financial services at below-market prices to retail clients, they may pull down the profitability of the banking system, with negative repercussions for other banks’ soundness. The literature’s verdict on cooperative banks’ role in financial stability is less than clear. Several papers suggest that cooperative banks may have more difficulties adjusting to adverse circumstances and changing risks.For example, Brunner and others (2004) note that the Swedish cooperative banking sector did not survive the crisis of the early 1990s in a cooperative form, as it faced high marginal costs of capital—the need to restore capital was a major factor in the decision to demutualize. Fonteyne (forthcoming) suggests that cooperative banks may be more vulnerable to shocks in credit quality and interest rates, because they are more focused on traditional financial intermediation than other institutions, and therefore have higher exposures to credit and interest rate risk.At the same time, several studies suggest that cooperative banks have generally lower incentives to take on risks. For example, Hansmann (1996) and Chaddad and Cook (2004) find that mutual financial institutions in the United States tend to adopt less risky strategies than demutualized ones. Whether cooperative banks have a positive or negative impact on financial stability therefore remains an empirical question. We address this question by analyzing individual bank data for major advanced economies and emerging markets. We examine two related issues:In addition, some authors have suggested that due to relatively less oversight by members, as opposed to owners in a commercial bank, managers in cooperative banks may be more likely to pursue their own goals (e. g. , â€Å"empire building†) rather than members’ interests, potentially hurting their stability. Fonteyne (forthcoming) discusses cooperative banks’ objective functions in more details and summarizes the relevant literature. 5 6 †¢ Cooperative banks’ soundness and resilience to stress. We test the hypothesis that cooperative banks are relatively weaker in responding to stress because of the features of their business model.Cooperative banks’ impact on other banks. We test the hypothesis that the presence of cooperative banks reduces the stability of other banks. As explained, this may be, for example, because the cooperative banks use their lower average cost of capital to pursue aggressive expansion plans that may weaken other financial institutions. †¢ The remainder of the paper is structured as follows. Section II introduces the data and variables used in the paper (characterized in more detail in Appendix I), and presents the estimation methodology. Section III presents the empirical results.Section IV sums up the conclusions, and suggests topics for further research. II. DATA AND METHODOLOGY A. Data Our calculations are based on individual bank data drawn from the BankScope database, provided by Bureau van Dijk. We use data on all commercial, cooperative, and savings banks in the database from 29 major advanced economies and emerging markets that are members of the Organization for Economic Cooperation and Development (OECD). 6 In total, we have data on 16,577 banks from 1994 to 2004, comprising 11,090 commercial banks, 3,072 cooperative banks, and 2,415 savings banks.Several general issues relating to the BankScope data need to be mentioned. First, the database, while being the most comprehensive commercially available database of banking sector data, is not exhaustive. Coverage varies from country to country; for most countries in our sample, the BankScope data cover 80 to 90 percent of the total banking system assets, and the coverage of cooperative banks is lower than for commercial banks (in particular, only a small number of cooperative banks is included in the United States). However, the coverage of our paper is still higher than in most banking studies (and in particular studies that focus on banks with particular features, such as large banks or banks that are listed on stock market), and even for cooperative banks our sample captures a majority in terms of total assets. We therefore believe the sample is comprehensive enough to make reliable inferences. 6 7 See Appendix I for a list of the OECD member countries.Also, our sample does not cover some specialized types of banking institutions, such as development banks or specialized investment companies (even though our analysis covers, for example, investment banking activities carried out by commercial banks on their balance sheet). 7 Second, BankScope gives the specialization (status) of a bank in the sample (commercial, cooperative, and savings) in the current year. Therefore, it is for instance likely that the commercial bank subset contains some banks that have been cooperative or savings banks in earlier periods.Where information was available, we adjusted the status of a bank accordingly. For example, France was subject to a banking reform in June 1999 in which all savings banks were converted into cooperative banks. The Alliance & Leicester (United Kingdom) as well as First National (Ireland) Building Societies were demutualized and were stock market listed in 1997 and 1998, respectively. Given the large number of banks in the sample, it was not possible to individually check potential changes in specialization over time. However, we do not think that this limitation of the BankScope dataset biases the results.Third, our analysis is based on unconsolidated bank statements. Ideally, we wou ld have opted for consolidated statements whereby the parent company integrates the statements of its subsidiaries. However, given that about 90 percent of BankScope observations for the selected countries and periods are based on unconsolidated data, we focus on results based on unconsolidated data. Nonetheless, we have also performed the same calculations with consolidated data, and obtained very similar results (available upon request). In addition to the bank-by-bank data, we also use a number of macroeconomic and other system-wide indicators.Those are described in more detail in Appendix I. B. Measuring Bank Stability Our primary dependent variable is the z-score as a measure of individual bank risk. The zscore has become a popular measure of bank soundness (see Boyd and Runkle, 1993; Maechler, Mitra, and Worrell, 2005; Beck and Laeven, 2006; Laeven and Levine, 2006; and Mercieca, Schaeck, and Wolfe, forthcoming). Its popularity stems from the fact that it is directly related t o the probability of a bank’s insolvency, i. e. , the probability that the value of its assets becomes lower than the value of the debt.The z-score can be summarized as z? (k+ µ)/? , where k is equity capital as percent of assets,  µ is average after-tax return as percent on assets, and ? is standard deviation of the after-tax return on assets, as a proxy for return volatility. The z-score measures the number of standard deviations a return realization has to fall in order to deplete equity, under the assumption of normality of banks’ returns. A higher z-score corresponds to a lower upper bound of insolvency risk—a higher z-score therefore implies a lower probability of insolvency risk. For banks listed in liquid equity markets, a popular version of the z-score is distance-to-default, which uses stock price data to estimate the volatility in the economic capital of the bank (Denmark National Bank, 2004). 8 (continued†¦) 8 One issue relating to the use o f z-scores for analyzing cooperative banks is whether the zscores are a fair measure of soundness across different groups of institutions, in particular given that cooperative banks are much less focused on returns and profitability than commercial banks.We think that the z-score is an objective measure, as all banks (cooperative, commercial, and savings), face the same risk of insolvency in case they run out of capital. This is exactly the risk captured by the z-score, which has the same methodology for any type of bank. If an institution â€Å"chooses† to have lower risk-adjusted returns, it can still have the same or higher z-score if it has a higher capitalization. C.Methodology We start by two preliminary steps: a decomposition of observed differences in z-scores into the underlying factors (capitalization, returns, and volatility of returns), and a calculation of correlation coefficients between z-scores and other variables of interest. The main part of our approach is to test the two hypotheses outlined in the introduction (Section I) using regressions of z-scores on a number of explanatory variables. We estimate a general class of panel models of the form z i , j ,t = ? + ? Bi , j ,t ? 1 + ? I j ,t ? 1 + ? ? s Ts + ? ? s Ts I j ,t ? 1 + ? ? s Ts Bi , j ,t ? 1 + ?M j ,t ? 1 + ? ? j C j + ? ? t Dt + ? i , j ,t where the dependent variable is the z-score z i , j ,t for bank i in country j and at time t; Bi , j ,t ? 1 is a vector of bank-specific variables; I jt ? 1 are time-varying banking industry-specific variables in country j; Ts , Ts I j ,t ? 1 and Ts Bi , j ,t ? 1 are the type of banks and the interaction between the type and some of the industry-specific variables as well as bank-specific variables, respectively; M j ,t , C j , and Dt are vectors of macroeconomic variables, country, and yearly dummy variables, respectively; and ? i , j ,t is the residual.To distinguish the impact of bank type on the z-score, we include two dummy variables. T he first dummy variable takes the value of 1 if the bank in question is a commercial bank, and 0 otherwise; the second one takes the value of 1 for savings banks, and 0 otherwise. If cooperative banks are relatively weaker than commercial (or savings) banks, the first (second) dummy variable would have a positive sign in the regression explaining z-scores. For most cooperative banks, however, market price data are not available. This paper therefore relies on the specification of the z-score that relies only on accounting data. At the systemic (country) level, we want to examine cooperative banks’ impact on other banks and the hypothesis that the presence of cooperative banks lowers systemic stability. For this reason, we have calculated the market share of cooperative banks by assets for each year and country and interacted it with the commercial bank dummy. For example, a negative sign of the sum of the coefficients of the cooperative banks’ market share and its inte raction with the commercial bank dummy would indicate a decrease in commercial banks’ stability (in their z-scores).In addition to these key variables of interest, the regression includes a number of other control variables, both on individual bank level and on country level. Appendix I provides a description of the variables. To control for bank-level differences in bank size, asset composition, and cost efficiency, we include the bank’s asset size in billions of U. S. dollars, loans over assets, and the cost-income ratio. Also, to control for differences in structure of banks’ income, we calculate a measure of income diversity that follows Laeven and Levine (forthcoming). The variable measures the degree to which banks diversify from traditional lending activities (those generating net interest income) to other activities. To further capture differences of cooperative banks in their business orientation, we interact the income diversity variable with the coope rative bank dummy. Controlling for these variables is important because there are differences in these variables between cooperative banks and the other groups. For example, commercial banks are on average larger than cooperative banks throughout the sample period.Similarly, the asset size of cooperatives is less volatile than for commercial banks but significantly more volatile than for savings banks. We want to adjust for the differences in these variables to ensure that we capture the â€Å"pure† impact of the bank’s legal form (commercial, cooperative, or savings) on stability. 10 Table 1 shows the summary statistics of the bank-specific variables by type of bank. On the country level, we also adjust for the impact of the macroeconomic cycle by including a number of macroeconomic variables (GDP growth rate, inflation, the real long-term interest rate, and exchange rate appreciation).To account for cross-country variation in z-scores caused by differences in market concentration, we include the Herfindahl index, defined as the sum of squared market shares (in terms of total assets) of all banks in the country. 11 9 The income diversity measure is defined as 1 ? (Net interest income ? Other operating income ) . Higher values of Total operating income the variable correspond to a higher degree of diversification. 10For completeness, we have also tested whether the impact of bank-specific variables such as asset size is different for the different types of banks (by multiplying the asset size with the relevant dummy variables), but this has not led to any significantly robust results. We do not have a strong prior on the impact of the Herfindahl index, because the existing literature contains two contrasting views on the relationship between concentration and stability. For example, Allen and Gale (2004) put forth theoretical arguments why more concentrated markets are likely to be more stable, and Beck, 11 (continued†¦) 0 In separate regres sions, we account for the quality of corporate governance in a country, using a popular indicator by Kaufmann, Kraay, and Mastruzzi (2005). The authors provide six governance measures (voice and accountability, political stability, government effectiveness, regulatory quality, rule of law, and control of corruption). We average the six measures across the available years (2004, 2002, 2000, 1998, and 1996) into one single index per country. The governance indicator should capture cross-country differences in institutional developments that might have an effect on banking risk.All bank-specific and macroeconomic variables, the Herfindahl index, and the cooperatives’ market share and its interaction with the commercial bank dummy are lagged to capture possible past effects of these variables on the banks’ risk. We also test for the robustness of the lagged effects by restricting the explanatory variables to contemporaneous effects. Across the whole sample, most observatio ns of the z-score are found in the 20–80 range; however, there are some extreme observations, resulting in the sample range being from -81 to 14,811 with an average of 57.This leads to the question whether to eliminate observations at the extreme end of the z-score distribution. On one hand, we are interested in situations of instability, and therefore would like to include extreme observations; on the other hand, some of the extreme observations may be due to very specific, one-off events, or sometimes data errors. To assess the robustness of our results with respect to the outliers, we have done all the calculations both for the full sample and for a sample that excludes the most extreme outliers.To keep the presentation succinct, this paper presents results for a sample that eliminates the 1st and 99th percentile from the distribution of the z-score. The results for the full sample including those extreme outliers are available from the authors; the main conclusions are th e same for both approaches. To further assess the robustness of the results with respect to the selected sample, we estimate the same regression for different country samples, and different bank size samples. We start with the widest sample that includes all OECD countries (except Slovakia, for which the BankScope contains no data on cooperative banks).We then estimate the same regression for the Euro area (EU12),12 and for countries where the cooperatives’ market share Demirguc-Kunt, and Levine (2005) provide empirical results consistent with the view that more concentration is associated with more financial stability. Contrary to these findings, for example, Boyd and de Nicolo (forthcoming) and Mishkin (1999) suggest that too concentrated systems can be characterized by increased risktaking behavior by banks. 12 We have also carried out all the estimates for EU15 countries (EU12, Denmark, Sweden, and the United Kingdom).The results have not been substantially different from those for EU12 and are therefore not reported here. Nonetheless, they are available from authors upon request. 11 exceeds 5 percent in our sample (Coop5). 13 As regards the robustness with respect to bank size, we estimate the regressions separately for large and small banks. We also test the robustness of our results with respect to the estimation methods. We start by pooled ordinary least squares (OLS) and fixed effects estimates, followed by a robust estimation technique, and a quantile regression.The robust estimation technique assigns, through an iterative process, lower weights to observations with large residuals, thereby making the estimation less sensitive to outliers. The quantile regression allows to address the question whether the factors that cause high fragility are systematically different from the factors that cause medium or low fragility. We would like to stress that our analysis is based on individual banks’ z-scores. The impacts calculated from the estim ated regressions are average impacts per bank.This approach provides a baseline assessment of stability and is frequent in the literature. However, to arrive at a more complete assessment of systemic stability, one needs to look also at correlation of losses across defaults and losses given default—a topic for further research. III. RESULTS A. Decomposition of Z-Scores and Correlation Analysis A preliminary analysis shows that the cooperative banks’ z-scores are on average significantly higher than for commercial banks (and slightly, but insignificantly, higher than for savings banks), suggesting that cooperative banks are more stable than commercial banks.Interestingly, this is not because of capitalization or profitability—those two are on average weaker for cooperative banks than for commercial banks. The result is driven by the fact that the cooperative banks’ standard deviation of returns is much lower, resulting in the high zscore (Tables 2 and 3). Why do we find the low volatility of returns over time in cooperative banks? A plausible explanation is that the cooperative banks use the customer surplus as a first line of defense in weaker times.Cooperative banks pass on an important part of their returns to customers in the form of surplus. Indeed, their stated objective is not maximization of profits, but rather maximization of the consumer surplus. This leaves the cooperative banks with relatively low average return ratios in normal years. However, in weaker years, they are able to extract some of the consumer surplus, thereby mitigating the negative impact of stress on returns. 13 The Coop 5 countries are Austria, France, Germany, Italy, Japan, Netherlands and the United Kingdom. 12We are therefore observing a lower variability of returns in cooperative banks than in commercial banks (and about the same as in savings banks). 14 In other words, our calculations suggest that the consumer surplus can be viewed as the first line of defense for cooperative banks, in a similar way as profits are the first line of defense for commercial banks. However, there are some important differences. First, consumer surplus is a very complex concept to measure. We are not able to observe consumers’ surplus on a consistent basis; even though we can make inferences about it from the pattern of returns.Second, while undistributed profits can be relatively easily used to replenish capital, extracting consumer surplus is one more step removed from capital and requires time. To address the idea that cooperative banks are less able to raise capital in situations of stress, we have also examined volatility in cooperative banks’ capitalization compared with commercial banks’ capitalization (even though volatility in capitalization is not a part of the z-score calculation). The results only onfirm our findings about z-scores, because cooperative banks also have a significantly lower volatility of capitalizati on. The finding that cooperative banks have higher z-scores is novel, but not inconsistent with the existing literature. The empirical papers on the subject note that cooperative banks have lower reported returns, but they find no compelling evidence that the lower returns would be due to a less effective management of revenues and costs than in commercial banks (e. g. , Brunner and others, 2004; and Altunbas, Evans, and Molyneux, 2001). 5 If the lower returns were due to inefficiencies in cooperative banks’ operation, then it would be difficult to argue that there are cushions that can be used in weak times. However, the finding that cooperative banks have lower returns with the same efficiency suggest that there are cushions that can be used in situation of stress, an idea that is consistent with our finding. 16 We also find no evidence for our sample that cooperative banks are less efficient than commercial banks in terms of the cost-income ratio (Table 1).To assess the ro bustness of our findings, we have also tried some alternatives to the standard definition of the z-score (Table 4). The underlying idea behind these alternative approaches (which have to our knowledge not yet been discussed in the literature) is that the standard An additional explanation of the lower volatility of returns can be the networks that cooperative banks form to provide a safety net. However, these support mechanisms are typically triggered only in extreme stress, and are therefore likely to explain only a small part of the observed difference in the volatility of returns. 5 14 The finding about lower returns is in contrast with previous observation by Valnek (1999), who finds that mutual building societies in the United Kingdom have higher returns and risk-adjusted returns on assets than commercial banks. In a recent paper, Mercieca, Schaeck, and Wolfe (forthcoming) estimate an equation for z-scores in a sample of small European banks, including small cooperative banks, but their estimated slope coefficient for a cooperative bank dummy is insignificant. 16 13 deviation underlying the z-score gives only a part of the information about the behavior of zscores.In particular, when assessing stability, we are much more interested in the downward spikes in returns on assets (ROAs) and z-scores than in the upticks. Table 3 has four panels, corresponding to four alternative variables that we have investigated, in particular: †¢ We have defined downward (upward) volatility of ROA as the sample average of the difference between the bank-specific ROA per year and its mean of ROA if the ROA is below (above) the bank-specific mean. Table 4 indicates that both downward and upward volatility of ROA are higher for commercial banks than for cooperative and savings banks.Comparing the absolute values within each bank type shows that the commercial banks' downward volatility of ROA is higher than its upward volatility. This finding does not hold for cooperative and savings banks. Similarly, we have defined the downward (upward) volatility of the z-scores as the sample average of the difference between the bank-specific z-score per year and its mean of the z-score if the z-score is below (above) the bank-specific mean. We cannot observe any statistical difference in the downward (upward) volatility of the z-scores.Furthermore, the downward (upward) volatility of the capitalization is defined as the sample average of the difference between the bank-specific equity-to-assets ratio per year and its mean of the capitalization if the equity-to-assets ratio is below (above) the bankspecific mean. The downward (upward) volatility of capitalization is lower for cooperatives than for commercial and savings banks. Commercial banks’ z-scores have a higher frequency in the lower distribution of the zscores than cooperative and savings banks.This supports the previous results of lower average z-scores for commercial banks during the sample period . †¢ †¢ †¢ Overall, the above robustness checks support the findings for the simple z-scores. 17 To further assess the robustness of our findings, we can also look at measures of financial soundness that are alternative to the z-scores. An obvious alternative are ratings by rating agencies. Table 5 presents a distribution of long-term credit ratings by the Fitch Ratings for cooperative banks and commercial banks in the 29 advanced economies and emerging markets.The overall conclusion is that at least on the first look there does not seem to be a major difference between the ratings for cooperative banks and commercial banks. For both groups, for example, about 90 percent of institutions have investment grade long-term credit 17 We have also calculated a modified z-score, defined as capitalization plus the ROA over the absolute value of the downward volatility of ROA. Results for this modified z-score confirm that on average, cooperative banks are more stable than comm ercial banks, reinforcing the findings from the above robustness tests.The results do not change qualitatively whether we use the absolute value of downward/upward deviation from the mean for the volatilities of the ROA, z-score and capitalization measures, or whether we use the squared downward/upward deviation from the mean. 14 rating (defined as BBB- or higher). It should be noted, however, that the distribution of ratings for cooperative banks is highly influenced by the ratings for German cooperative banks, all of which were given the same (A+) rating. This limits the usefulness of ratings for further, econometric analysis.In the next section, we will therefore focus on the z-scores. Before discussing the regression results, we provide correlation coefficients between the zscore and selected key variables in Table 6. Here, we differentiate between all the banks in the sample and large (small) banks that have assets larger (smaller) than US$1 billion. Similar to the findings fro m the decomposition of the z-score in Table 1, commercial banks tend to have lower z-scores than cooperative and savings banks in all model specifications.Also, both the cooperative bank dummy and the z-score are positively correlated across the different samples. While there is no evidence that the cooperative market share per country and year is negatively correlated with the z-scores of all commercial, cooperative and savings banks, we do find a significantly negative correlation between the z-scores and the interaction term of the share of cooperatives and commercial bank dummy in all models as hypothesized previously.A stronger cooperative sector is associated with higher commercial banks’ risk. Since correlation findings do not necessarily reflect causal relationships and do not account for other control factors, we now turn to the panel regressions. B. Regression Analysis Table 7 presents pooled OLS and fixed effects estimates for the z-scores in the full sample of ban ks in OECD countries, in the Euro zone (EU12), and the countries where the cooperatives’ market share exceeds 5 percent (Coop5). 8 All panel regressions include clustered standard errors (by bank), year and country dummy variables. Our main focus in discussing the results is on the two hypotheses outlined in the introduction, namely that cooperative banks are weaker and that their presence reduces the stability of other banks. All the pooled OLS regressions provide strong evidence that cooperative banks have higher z-scores than commercial and savings banks.The estimated signs of the commercial bank dummy and savings bank dummy are negative in all the pooled OLS and fixed effects regressions (and significant at the 10 percent level in all but one the regressions). That is, cooperative banks appear less likely to become insolvent than the other two bank types. This 18 In general, it is not possible to identify the commercial and savings bank dummies in the fixed effects regres sions since they are not time-varying. Since we have changed the status of a few banks as discussed before, we could in principle identify the bank dummies.But we do omit the commercial and savings bank dummies in the fixed effects estimations, as only a few dummies are time-varying, and therefore the coefficients and p-values might not be very meaningful. 15 is in line with the findings from the decomposition of the z-score in the previous section. It strengthens the previous findings, because the conclusion about higher z-scores in cooperative banks holds even if we adjust for other explanatory factors, such as the fact that cooperative banks are typically more retail-oriented than commercial banks.As regard the impact of a higher presence of cooperative banks on banking stability, the first approximation is provided by the estimated slope coefficient of the â€Å"share of cooperatives† variable, which is positive and significant in all but one specification. Based on this estimated slope coefficient, we can say that a higher share of cooperative banks increases stability (measured by z-score) of an average bank in the same banking system. It is important to stress, however, that this is only an average effect based on all the commercial, cooperative, and savings banks in the sample. 9 To analyze in more detail the cooperative banks’ impact on other (e. g. , commercial) banks, one needs to analyze the sum of the coefficients of (i) the share of cooperative banks and (ii) the interaction of the share of cooperative banks with the other bank (e. g. , commercial bank) dummy. Looking again at the estimates in Table 7, and focusing on commercial banks, we find that a higher market share of cooperative banks has a significantly negative effect on commercial banks’ risk in the pooled OLS model for OECD countries.This would be consistent with the hypothesis that a higher presence of not-profit-maximizing cooperative banks could pull down the sou ndness of commercial banks. This could be because cooperative banks â€Å"over-pay† for deposits or â€Å"under-charge† for assets, or because the commercial banks get crowded out of the retail market and have to turn to markets that are more volatile. 20 However, this finding does not hold for the other model specifications. There is thus some, but limited, evidence in support of Goodhart’s (2004) hypothesis in the full sample. 1 The other explanatory variables have the expected signs. In particular, we find that larger banks tend to have lower z-scores, perhaps because they engage in riskier activities than smaller banks (and reflecting a relatively higher risk aversion of small banks). Also, banks with higher loan-to-asset ratios tend to be riskier (even though this result is valid only for the 19 If we measured a â€Å"portfolio z-score† of the banking system, it would increase even more than the average zscore, due to the simple fact that a higher ma rket share of cooperative banks means a higher share of banks with higher -scores. However, our approach in this analysis is derived from individual bank z-scores. To examine the hypothesis that cooperative banks over-pay for deposits or under-charge for loans, we have calculated the implicit deposit and lending rates for the commercial and cooperative banks, defining the implicit deposit rate as total interest rate expenses over deposits and the lending rate as interest rate income over loans. Based on this calculation, there is no significant difference for deposit rates, but there is some evidence that cooperative banks charge lower lending rates than commercial banks (9. percent compared with 13. 2 percent). 21 20 For savings banks, the impact of a higher cooperative bank share is insignificant and not reported in Table 7. 16 OECD sample as a whole, but not necessarily in the EU12 and Coop5 sub-samples). Banks with higher loan portfolios on their balance sheets relative to their total assets might be more likely to experience problems with non-performing loans and thus be riskier. Finally, inefficient banks in terms of their cost-to-income ratio are less likely to cover their costs when hit by adverse shocks, so they tend to be riskier.The evidence on the effect of bank concentration on individual bank risk is mixed and unclear in the pooled OLS and fixed effects regressions. The results from the income diversity variable and its interaction with the cooperative bank dummy support the above hypothesis. Overall, an increase in diversity (which could be interpreted as less focus on the traditional lending business) tends to increase banks’ risk; however, cooperative banks tend to become more stable if they diversify their activities (sum of the coefficients of the income diversity variable and its interaction with the cooperative bank dummy).This result can be explained by the fact that commercial banks are about 30– 40 percent more diversified than cooperative banks (both in the whole OECD sample and the EU12 and Coop5 sub-samples—see Table 1). Because of their stronger focus on the lending (retail) business, cooperative banks’ stability improves from an increase in diversification of their activities; in contrast, a further move away from retail business in commercial banks, which have already a relatively higher share of other (wholesale) activities, results in decreasing stability (z-scores).Table 8 presents the OECD pooled regressions with the governance indicator constructed by Kaufmann, Kraay, and Mastruzzi (2005). As expected, banks in countries with a higher level of institutional development are on average less risky than banks in countries which lack the same governance quality. From a comparison of Tables 7 and 8, the governance indicator does not have a significant impact on the estimated slope coefficients for the commercial and savings bank dummies, suggesting that cooperative banks are not mo re or less sensitive to governance problems than the other types of banks.However, this finding has to be taken with a grain of salt, because we use the overall quality of governance in the country as a proxy for corporate governance in the individual banks, on which there are unfortunately no direct cross-country data. To assess the robustness of our results, we have also estimated models for large and small banks, n addition to the full sample regressions. 22 Table 9 replicates the previous regressions on the OECD, EU12, and Coop5 countries only with large banks, defined as those that have assets larger than US$1 billion.The commercial bank dummy is significantly negative in the In addition, to account for systemic importance, we have also estimated a weighted regression, weighting the different observations by total assets. The results, which were not substantially different from those for large banks in Table 8, are available from the authors upon request. 22 17 pooled OLS estim ations (except the OECD sample). The previous result that a strong cooperative banking sector on average does not weaken the commercial banking sector is strongly supported in the regressions with large banks for all model specifications except the OLS OECD model.Table 10 gives the model findings for small banks (those with assets below US$1 billion). Small commercial banks tend to be riskier than small cooperative banks but there is no substantial evidence that an increase in the cooperative market share has a consistently and significantly negative effect on the smaller commercial banks’ individual risk. As a further sensitivity test, we estimated the models with the robust estimation technique, which assigns lower weights to observations with large residuals, to avoid the impact of outliers (Beck, Cull, and Jerome, 2005).The results in Table 11 support the main conclusion from the previous discussion. Finally, to address the question whether the factors that cause high fra gility are systematically different from the factors that cause medium or low fragility, we adopt quantile regression techniques. Table 12 gives the regression results at the 25th, 50th, and 75th percentiles of the OECD, EU12, and Coop5 countries. 23 The model setup is the same as for the full sample with the same variables included and the same outliers excluded (1st and 99th percentile of the distribution of the z-score).Based on the coefficients of the commercial bank dummy, the gap between the z-scores of commercial and cooperative banks tends to widen with the quantiles in the OECD, EU12, and Coop5 models, which suggests that the distribution of z-scores in cooperatives is much more skewed to the right: if one compares strong cooperative banks and strong commercial banks, the difference in z-scores is much bigger than for weak cooperative banks and weak commercial banks. A similar conclusion is valid also for the comparison of cooperative banks and savings banks, even though th e differences in their z-scores are generally smaller.Upon inspecting the sum of the coefficients of the cooperative share and its interaction with the commercial bank dummy, it appears that an increased presence of cooperative banks per country and year has a negative effect on the weakest commercial banks. In other words, commercial banks that already have low z-scores suffer more from a stronger cooperative sector than commercial banks with higher z-scores. Whereas the previous estimations did not provide any substantial evidence for a negative effect of a higher presence of cooperative 23The 50th percentile gives the median least square estimator which minimizes the median square of residuals rather than the average. In the generalized quantile regression, we estimate an equation describing a quantile other than the median. Specifically, we estimate the first quartile (25th percentile) as well as the 75th percentile. 18 banks on the average commercial bank’s stability, in stead there appears to be some (negative) effect on the weaker commercial banks. In all the regressions, restricting the explanatory variables to only contemporaneous effects does not change the main findings (tables available upon request).We also defined alternative z-scores as ln(1+(z/100)), but this did not affect the main conclusions. IV. CONCLUSIONS AND TOPICS FOR FURTHER RESEARCH The findings in this paper indicate that cooperative banks in advanced economies and emerging markets have higher z-scores than commercial banks and (to a smaller extent) savings banks, suggesting that cooperative banks are more stable. This finding, perhaps somewhat surprising at first, is due to much lower volatility of the cooperative banks’ returns, which more than offsets their relatively lower profitability and capitalization.We suggest that this observed lower variability of returns, and therefore the higher z-scores, may be caused by the fact that cooperative banks in normal times pass on most of their returns to customers, but are able to recoup that surplus in weaker periods. To some extent, this result can also reflect the mutual support mechanisms that many cooperative banks have created. The finding about the higher z-scores in cooperative banks is quite robust with respect to modifications in the measurement of volatility and z-scores.It also remains valid if one distills the â€Å"pure† impact of the cooperative nature of a bank, by using regression analysis and adjusting for differences in bank size, loan to asset ratios, income diversity, and other factors with potential impact on individual bank’s stability. Using the regression analysis, we also find that a higher share of cooperative banks increases stability (measured by z-score) of an average bank in the same banking system. The impacts differ by the groups of banks, however.High presence of cooperative banks appears to weaken commercial banks, in particular those commercial banks that are already weak to start with. This finding is consistent with Goodhart’s (2004) hypothesis that the presence of non-profit-maximizing entities can pull down stability of other financial institutions. This empirical result can be explained by the fact that a higher cooperative bank presence means less space for weak commercial banks in the retail market and therefore their greater reliance on less stable revenue sources such as corporate banking or investment banking.When interpreting the results, one needs to bear in mind some caveats relating to the z-score, such as its reliance on accounting data and its focus on capital and profits rather than, say, liquidity or asset quality. As a robustness test, we have therefore tried to include some possible alternatives to the z-scores, such as ratings. The available data suggest that the ratings of cooperative banks are not substantially worse than those for commercial banks; 19 however, the dominance of observations from one cou ntry (Germany) in the ratings database does not allow for a full-fledged cross-country analysis.Several issues not addressed in this paper could be analyzed in future research. One of them is corporate governance issues. As discussed in Fonteyne (forthcoming) or Cuevas and Fischer (2006), corporate governance issues in cooperatives are often more prominent than in commercial banks. Among these issues is the presence of an owner-less endowment, since members of cooperatives are only invested with the notional value of their shares and have no right to the accumulated capital. Furthermore, there is a collective action problem that might lead to empire-building by management.BankScope and similar databases do not contain institution-specific data on the quality of the corporate governance, but with a more detailed database, perhaps on a smaller sample, it may be possible to analyze this issue. Another issue for further research is the impact of networks on cooperative banks’ sta bility. Cooperative banks can realize important benefits by forming networks, as it allows the pursuit of economies of scale and scope, and the provision of a safety net or mutual support mechanism. However, a more complex structure can also create new challenges for stability.For example, Desrochers and Fischer (2005), in a cross-country survey on the level of integration of cooperatives, note that lateral contracts between cooperatives involve risks that counterparts will behave opportunistically to appropriate the rent generated by the alliance. The analysis based on individual banks’ z-scores, presented in this paper, provides a baseline assessment of systemic stability. To arrive at a more complex assessment, one should look also at losses given default and correlation of losses across defaults (Cihak, 2007).This issue goes beyond the scope of this paper, and is an important topic for further research. Finally, we have treated the share of cooperative banks as an exogeno us variable that impacts the z-scores. When longer time series become available, it might be possible and useful to test whether the share of cooperative banks is in fact endogenous with respect to the z-scores, i. e. , whether this measure of stability affects the share of cooperatives in a system. 20 Table 1. Summary Statistics of Bank-Specific Variables in the Sample, 1994–2004 (In percent, unless indicated otherwise) Assets (Billion USD) Mean Std. Dev.OECD Commercial Cooperative Savings EU12 Commercial Cooperative Savings Coop5 Commercial Cooperative Savings Loans to Assets Cost-Income Ratio Mean Std. Dev. Mean Std. Dev. Income Diversity Mean Std. Dev. 3. 78 1. 90 1. 90 32. 52 14. 41 6. 93 0. 57 0. 59 0. 63 0. 21 0. 14 0. 18 70. 27 72. 26 70. 03 44. 47 16. 91 32. 86 0. 33 0. 24 0. 24 0. 25 0. 19 0. 20 8. 94 1. 22 2. 65 43. 06 8. 14 6. 64 0. 43 0. 59 0. 58 0. 28 0. 14 0. 13 70. 10 71. 99 67. 09 42. 23 14. 30 13. 22 0. 39 0. 28 0. 23 0. 49 0. 19 0. 12 18. 06 1. 87 2. 02 79. 75 14. 47 4. 11 0. 50 0. 59 0. 58 0. 28 0. 14 0. 13 71. 79 72. 52 67. 55 43. 43 16. 87 10. 07 0. 34 0. 25 0. 24 0. 4 0. 18 0. 08 Source: Authors' calculation based on BankScope Data. Note: The 1st and 99th percentile of the distribution of the z-score variable is excluded. 21 Table 2. Decomposition of Z-Scores for the Full Sample 1994–2004 Z-score Equity to Assets (percent) ROA (percent) Standard deviation of ROA (% points) All banks Commercial Cooperative Savings Large banks Commercial Cooperative Savings Small banks Commercial Cooperative Savings 50. 0 60. 8 60. 1 12. 13 7. 19 9. 29 0. 94 0. 39 0. 55 0. 59 0. 28 0. 35 29. 6 46. 6 47. 3 7. 06 5. 62 5. 91 0. 69 0. 28 0. 48 0. 71 0. 37 0. 35 46. 5 56. 9 55. 4 11. 21 6. 84 7. 99 0. 90 0. 37 0. 53 0. 65 0. 1 0. 35 Source: Authors’ calculations based on BankScope data. Note: To avoid possible outliers in this sample, the 1st and 99th percentile of the distribution of each variable is excluded. Large (Small) banks are defi ned as having assets larger (smaller) than 1 billion USD. 22 Table 3. Decomposition of Z-Scores for Selected Countries, 1994–2004 Z-score Equity to Assets (percent) ROA (percent) Standard deviation of ROA (percent) Austria Commercial Cooperative France Commercial Cooperative Germany Commercial Cooperative Italy Commercial Cooperative Japan Commercial Cooperative Netherlands Commercial Cooperative UK Commercial Cooperative 28. 70. 9 15. 95 6. 83 1. 01 0. 45 1. 708 0. 122 44. 4 82. 2 13. 31 5. 44 1. 07 0. 29 0. 471 0. 067 25. 8 33. 5 4. 47 5. 43 -0. 16 -0. 04 0. 949 1. 001 30. 7 40. 3 11. 44 12. 89 0. 43 0. 88 1. 246 0. 465 37. 3 78. 8 12. 05 5. 08 0. 48 0. 28 1. 197 0. 124 17. 8 42. 1 10. 69 6. 64 0. 39 0. 58 2. 088 0. 223 33. 8 34. 3 11. 20 6. 02 0. 70 0. 39 0. 846 0. 407 Source: Authors’ calculations based on BankScope data. Note: To avoid possible outliers in this sample, the 1st and 99th percentile of the distribution of each variable is excluded. All selected count ries have a market share of cooperative banks higher than 5%. 23Table 4. Sensitivity of the Z-score Decomposition Bank type Commercial Cooperative Savings Return on assets Downward volatility (percentage points) Upward volatility (percentage points) Z-scores Downward volatility (percentage points) Upward volatility (percentage points) Equity to assets Downward volatility (percentage points) Upward volatility (percentage points) -0. 46 0. 38 -0. 19 0. 20 -0. 21 0. 21 -3. 79 3. 99 -3. 47 3. 85 -3. 78 4. 12 -1. 53 1. 69 -0. 53 0. 58 -0. 78 0. 81 Distribution of Z-scores (% of observations in banks of the same type) Less than 0 0. 37 0 to 10 13. 65 10 to 20 14. 74 20 to 30 13. 2 More than 30 57. 52 0. 62 9. 20 10. 72 13. 04 66. 42 0. 13 6. 38 9. 85 14. 80 68. 84 Source: Authors' calculation based on BankScope data. Note: To eliminate outliers, the 1st and and 99th percentiles of the distribution of the downward (upward) volatility variables were excluded. 24 Table 5. Fitch's Long-Term R atings of the Banks in Sample All Banks No. Percent 2 0. 17 16 1. 36 26 2. 21 72 6. 11 781 66. 30 77 6. 54 64 5. 43 40 3. 40 35 2. 97 29 2. 46 10 0. 85 2 0. 17 15 1. 27 4 0. 34 3 0. 25 2 0. 17 1,178 100. 00 Commercial No. Percent 2 0. 54 14 3. 75 23 6. 17 66 17. 69 53 14. 21 54 14. 48 39 10. 46 38 10. 9 28 7. 51 24 6. 43 7 1. 88 2 0. 54 14 3. 75 4 1. 07 3 0. 80 2 0. 54 373 100 Cooperative No. Percent 0 0. 00 1 0. 15 2 0. 29 2 0. 29 664 96. 37 9 1. 31 7 1. 02 0 0. 00 2 0. 29 1 0. 15 0 0. 00 0 0. 00 1 0. 15 0 0. 00 0 0. 00 0 0. 00 689 100. 00 AAA AA+ AA AAA+ A ABBB+ BBB BBBBB+ BB BBB+ B BTotal Note: All 637 cooperative banks in Germany have a Fitch rating of A+. 25 Table 6. Correlation Coefficients between the Z-Score and Selected Key Variables, 1994–2004 Commercial Bank Dummy Cooperative Bank Dummy Savings Bank Dummy Share Coop Share Coop* Commercial Full Sample OECD -0. 060*** 0. 026*** 0. 051*** -0. 041*** -0. 38*** Large Banks OECD -0. 225*** 0. 115*** 0. 147*** 0. 100*** - 0. 168*** Small Banks OECD -0. 047*** 0. 013*** 0. 050*** -0. 034*** -0. 105*** EU12 -0. 244*** 0. 178*** 0. 041*** 0. 128*** -0. 184*** Coop5 -0. 221*** 0. 137*** 0. 066*** 0. 068*** -0. 195*** Commercial Bank Dummy Cooperative Bank Dummy Savings Bank Dummy Share Coop Share Coop* Commercial EU12 -0. 340*** 0. 115*** 0. 236*** 0. 130*** -0. 241*** Coop5 -0. 288*** 0. 091*** 0. 208*** 0. 085*** -0. 245*** Commercial Bank Dummy Cooperative Bank Dummy Savings Bank Dummy Share Coop Share Coop* Commercial EU12 -0. 179*** 0. 160*** -0. 008*** 0. 098*** -0. 144***Coop5 -0. 155*** 0. 119*** 0. 001 0. 052*** -0. 141*** Note: * significant at 10%; ** significant at 5%; *** significant at 1%. 26 Table 7. Regression Results (Full Sample) OECD (1) Assets (-1) Loans/ Assets (-1) Cost-Income Ratio (-1) Income Diversity (-1) Income Diversity* Cooperative Bank Dummy (-1) Herfindahl Index (-1) Commercial Bank Dummy Savings Bank Dummy Share of Cooperatives (-1) Share of Cooperatives * Commercial Bank Dummy (-1) GDP Growth (-1) Inflation (-1) Exchange Rate Appreciation (-1) Real Long-Term Interest Rate (-1) Constant Observations R-squared Clustered by Banks Type -0. 026 (0. 000)*** -13. 123 (0. 00)*** -0. 185 (0. 000)*** -19. 299 (0. 000)*** 23. 107 (0. 000)*** -0. 005 (0. 000)*** -4. 79 (0. 029)** -2. 547 (0. 196) -0. 094 (0. 324) -0. 386 (0. 000)*** -0. 246 (0. 037)** 0. 44 (0. 006)*** 0. 043 (0. 009)*** -0. 398 (0. 004)*** 39. 898 (0. 000)*** 78,298 0. 103 14,025 OLS (2) -0. 013 (0. 023)** -3. 225 (0. 000)*** -0. 001 (0. 572) -1. 132 (0. 004)*** 3. 67 (0. 000)*** 0. 001 (0. 002)*** (3) -0. 027 (0. 073)* 3. 802 (0. 318) -0. 044 (0. 038)** -3. 4 (0. 155) 6. 877 (0. 184) -0. 005 (0. 005)*** -22. 685 (0. 000)*** -7. 437 (0. 003)*** 0. 278 (0. 033)** -0. 027 (0. 866) -0. 081 (0. 786) -1. 901 (0. 000)*** 0. 34 (0. 096)* 0. 597 (0. 145) 55. 966 (0. 000)*** 22,665 0. 112 3,239 OLS EU12 (4) -0. 043 (0. 000)*** -1. 996 (0. 347) -0. 009 (0. 076)* -0. 742 (0. 184) 4. 534 (0. 000)*** -0. 0 004 (0. 537) (5) -0. 019 (0. 001)*** 3. 461 (0. 349) -0. 078 (0. 000)*** -4. 12 (0. 107) 13. 418 (0. 004)*** 0. 001 (0. 643) -17. 143 (0. 000)*** -4. 314 (0. 080)* 0. 086 (0. 557) -0. 003 (0. 989) 1. 002 (0. 000)*** 0. 091 (0. 789) 0. 061 (0. 015)** -0. 006 (0. 987) 22. 558 (0. 000)*** 25,241 0. 106 3,723 OLS Coop5 (6) -0. 015 (0. 028)** 0. 882 (0. 705) -0. 008 (0. 032)** -0. 858 (0. 077)* 2. 585 (0. 001)*** 0. 005 (0. 000)*** 0. 114 (0. 01)*** 0. 019 (0. 699) -0. 14 (0. 001)*** 0. 133 (0. 009)*** 0. 068 (0. 000)*** 0. 184 (0. 000)*** 46. 652 (0. 000)*** 78,298 0. 058 14,025 FE 0. 127 (0. 007)*** -0. 101 (0. 093)* 0. 012 (0. 924) -0. 427 (