In this paper, the transmission pattern of inflation in Africa is investigated in several contexts. Specifically, the results of the decomposition of variance are analysed, which are obtained by estimating an error correction model comprising 11 countries: seven major African countries and four industrialized countries, i.e., the USA, UK, France, and Japan. The major empirical findings are as follows. First, a surprisingly large fraction of domestic inflation in Africa is attributable to inflation shocks originating in foreign countries. Second, the USA is found to be the leading producer of inter-continental inflation in Africa. Third, although the Ivory Coast does seem to be the marginal leader, geographical proximity does not seem to play a significant role in intra-continental inflation transmission. Fourth, Friedman (Essays in Positive Economics, University of Chicago, 1953)'s argument for the flexible exchange regime is found to be marginally valid for Sub-Saharan African countries: African countries adopting the independently floating exchange rate system tend to be less influenced by foreign inflation innovations.
This study examines the decision of regulated utilities to raise new financing via common stock, debt, or preferred stock offerings. We develop several logit models to test how a set of relevant variables affects the issuing choice. These variables include the level of insider ownership, regulatory climates, measures of aggregate market conditions, bankruptcy risk, deviations from the long‐and short‐term target ratios, asset composition, etc. In addition, this paper tests whether the cross‐sectional level of debt ratio is related to some of these same factors. Our findings indicate that U.S. electric utilities are not influenced by market timing when making a choice among long‐term financing instruments. However, our results do show that ownership structure variables, such as the number of directors and officers, seem to have a significant negative influence upon the choice of common stock, thus lending support to Friend and Lang's finding. In addition, capital structure seems to matter for utilities.
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