The revamp of the National Student Survey (NSS) has led to the elimination of the final ‘overall satisfaction’ question for Higher Education Institutions in England. This paper develops an index approach that can effectively summarise student satisfaction, utilising a ‘fuzzy poverty’ methodology that assigns weights to dissatisfaction outcomes based on their correlation levels. We show how our dissatisfaction index enables a comprehensive sector-level analysis by combining NSS data with sector-wide data and further show the usefulness by presenting a case study. Our approach can be universally and unbiasedly applied to student surveys globally, while alleviating problems related to the removal of the overall satisfaction question in the UK.

Numerous studies have highlighted the significant role of Student Evaluations of Teaching (SETs) as a key metric for assessing teaching quality in Higher Education (HE). Building upon these insights, our study introduces an innovative four-tiered model, derived from diverse research, to examine the reliability of SETs. This model addresses biases associated with SETs, delving into both statistical anomalies and cognitive biases, with particular emphasis on often-overlooked hidden context and timing factors. We reveal that these biases can distort SET scores, leading to potentially inaccurate representations of both individual and comparative academic performances. The implications of our research are significant for those influencing HE policy-making and performance evaluation. We echo previous calls for a more expansive approach to teaching effectiveness, essential for genuine insight into teaching quality. By adopting this perspective, HE can design better-informed strategies, ensuring policies and practices reflect the diverse nature of teaching excellence.

Against the background of a succession of financial mishaps in the banking industry, all deeply rooted in the behavior of individual employees, this paper examines the place of "people risk" in the context of operational risk management in UK banks. Our research is informed by an examination of the literature alongside empirical evidence from 25 semi-structured interviews with operational risk practitioners in UK banks, and we find varying levels of awareness and understanding of people risk. As a result of a regulatory focus on quantitative capital requirements, we also find that management of people risk is subsumed under this regulatory approach, and we find evidence that the "embedded" nature of people risk has hindered the development of a more comprehensive industry-wide approach to people risk management. Nevertheless, some operational risk managers are working more closely with their human resources partners to develop a more cohesive approach to people risk management. In the context of current reforms to the capital requirements for operational risk, it may be an opportune time to examine the regulatory approach to people risk in banks.

Surplus-lag testing has been proposed as a means of undertaking persistence-robust causality analysis irrespective of the integrated nature of economic and/or financial series under examination. The present paper examines whether this suggested robustness holds when considering series experiencing changes in their orders of integration or persistence. Using Monte Carlo simulation, the results of finite-sample analysis demonstrate that while surplus-lag tests outperform Granger causality tests in these circumstances, they can nonetheless exhibit severe size distortion. The empirical relevance of this previously undetected fragility is reinforced by an examination of the relationship between inflation and economic growth in the USA. Recognising recent research documenting the extensive application of causality analysis within corporate finance and the noted occurrence of changes in persistence in financial series, the results obtained provide a cautionary note for practitioners anticipating persistence-robust inference when undertaking surplus-lag causality analysis.

Recent research into the dynamic adjustment of prices within the London housing market is extended via the application of a novel two-step procedure. Combining the non-parametric analysis of the ranking distributions of the levels and changes in house prices with the application of a cross-sectional convergence technique results in the detection of a three-tier system in which highly significant convergence clubs are identified within borough-level data. These findings contrast with both the divergence apparent when considering all boroughs and the failure of previous research to identify convergent groupings. The novelty of the empirical methods is supplemented by a discussion of various theoretical factors such as gentrification, displaced demand, immigration, foreign investment and criminal activity in relation to the findings obtained.

Interest in financial services firms developing and implementing robust systems and structures to manage operational risk has been growing. While there now appears to be some consensus in terms of definitions, quantification and modeling, firms are struggling with the qualitative side of operational risk management (ORM). This is particularly the case for financial institutions’ operational risk governance, where the three lines of defence model has become standardized. At the same time, corporate scandals post-financial crisis continue to indicate deficiencies in operational risk governance. Our paper examines the three lines of defence in the context of ORM in UK financial institutions. It focuses on roles and responsibilities and then analyzes the effectiveness of the traditional three lines of defence model. We find a lack of common understanding of the lines of defence in financial institutions, which leads to the duplication of roles and gaps in coverage. This is concerning for the industry, the economy and regulators.

Chinese commercial banks are increasingly using syndicated lending (SL) to develop cross-border business. In this paper, we examine the determinants of cross-border SL by Chinese banks during the period 2006-2014 across 68 countries. The results show that expected credit risk is one of the main drivers of Chinese banks’ overseas syndication but that there are additional drivers, including government ownership, free riding, compensation for limited physical presence in borrower countries, the lowering of information asymmetries and diversification of the lending portfolio. We also find that Chinese banks prefer to group together in a syndicate rather than partner with a foreign-owned bank, and they demonstrate different motivations when extending SLs to advanced and emerging economies.

The explosive issue of banker bonuses refuses to go away – and not just because of the Bank of England’s controversial new “clawback” measures, which will defer bonuses for three to five years. President Obama recently played his part in relighting the fuse when he used a radio interview to claim bonuses still encourage Wall Street traders to “take big risks” that might imperil economic stability. As he put it:

The UK banking industry has steadily moved from the traditional role of financial intermediation and is increasingly relying on non-traditional business activities that generate fee income, dealings profit and other types of noninterest income. Using the dataset of large British Banks for the period 1986-2012, this study investigates the changes in the bank income structure as a result of the 1986 deregulation and tease out the effect that these changes have had in relation to systemic risk. On a micro analysis, larger banks are more able to sustain high levels of noninterest income. Among the banks Lloyds and HSBC stand out as the major players in noninterest income generation. At aggregate level while interest income reflects a stable trend, we find a significant upward but slightly volatile trend in noninterest income for the period 1999-2008 before a sharp downturn induced by the financial crisis. This paper argues that in terms of financial stability, the banks' greater reliance on noninterest income particularly commission income is associated with higher systemic risk. This study has shown that there is a positive correlation between interest income and non-interest income for the five banks.

This paper investigates the effect of macroeconomic changes particularly the cyclical nature of bank performance using the dataset of Large British Banks over the period 2004-2011. Financial ratios are employed to investigate whether loan loss provision, lending rate, income level and return on asset show a cyclical pattern. The study found a cyclical pattern before, during and after financial crisis 2008. The results show falling asset prices, high capital requirement, reduce lending and loss in bank balance sheet in the British banking sector. Therefore, for macro and financial stability, it is important to understand that to what extend banks are affected by the macro-economy.

The paper conducts a critical analysis of internal loss data collection implementation in a UK financial institution. We use elite semi-structured interviews, with a sample of 15 operational risk consultants from a leading international financial institution. Using content analysis, the data covers a wide range of business areas, with particular attention drawn towards the development of internal loss collection and operational risk management. The results suggest that the development of operational risk management as a function stems from external compliance (Basel II) and the internal pressure to add value to the business portfolio. This need for compliance was augmented as a driver of internal loss data collection; however, participants also recognised that the function of loss data collection is a tool of solid internal risk management and enhances managerial decision-making. The research also highlights the problems in cleansing data in order to ensure that all information implemented in the capital allocation model is valid and reliable.

The preponderance of subjective well-being analysis investigates the peripheral impact of objective measures such as income. By shifting the focus towards family satisfaction, this paper offers an alternative perspective. Through the incorporation of both employment and home characteristics, it provides an opportunity to integrate the analysis of work-life balance with the expansive wider literature of job satisfaction. Our estimates generate two key findings. First, as is frequently found in the employment literature, we confirm the existence of significant gender differences in family satisfaction. Second, the belief that home ownership is necessarily a significant source of well-being is rejected. (C) 2011 Elsevier Inc. All rights reserved.

PurposeThis paper aims to investigate the effect of UK building society demutualisation on levels of efficiency at the largest five commercial banks in the UK.Design/methodology/approachThis research utilises data envelopment analysis (DEA) within a rarely adopted windows framework to analyse efficiency. The study also incorporates a novel risk proxy in the profit‐orientated approach to determine DEA input/output which proves a useful innovation to the methodology.FindingsThe overall aggregate results suggest that converting building societies outperformed their bank counterparts in all areas of efficiency and that scale efficiency dominates pure technical efficiency. Interestingly, the results also indicate that the level at which institutions continue to find economies of scale had increased when compared to previous research.Originality/valueThe period of building society demutualisation offers an empirical opportunity to examine deregulation upon market participants. It is felt that this study offers academics, regulators and participants within the financial services environment an insight into the efficiency impact of deregulation.

The paper investigates the notion that homeownership affects poverty perception. This is investigated by utilising a logit model to analyse various characteristics of homeowners in 11 different European nations. Overall, the analysis fails to reject the notion that homeowners throughout Europe are less likely to perceive themselves as living in poverty, but no evidence is found that homeownership is more valued in nations with high owner-occupancy rates. However, support is found for the notion that homeownership is used as a form of security in countries that experience greater income inequality.

Although expenditure on wages represents a major element of costs in financial services firms, there is a dearth of studies analysing wage levels in the sector. This paper examines reservation wage levels in the sector by utilising maximum likelihood selection and stochastic frontier methodologies in two leading European economies: UK and Germany. Our results show that wage achievement is higher in the UK than Germany. At first glance, this seems counter-intuitive, given that actual wage costs and the overall cost-income ratio is higher in Germany than the UK.

Past research on labour-market skills shortages indicates that employers report skills shortages or hard-to-fill vacancies for a variety of different reasons. Nevertheless, there is some consensus that skills-shortages analysis needs to examine such shortages within the context of the local labour market in order to understand the labour-market dynamics and structural factors that affect the propensity for unemployed people to fill ‘skills shortage’ vacancies. The traditional approach has been to utilise qualitative analysis and case studies. In contrast, in this paper we undertake a multivariate probit analysis of employer perceptions of skills shortages utilising a subregional dataset from a survey of Dorset employers undertaken in 1998. On a general level, we demonstrate the complexity involved in attempting to measure skills problems using the responses of employers to standard surveys. The key findings of the probit analysis are that: firm size is a significant determinant in skills-deficiency perception, growing firms have a higher skills-shortage perception, and reported perceptions of skills deficiencies vary significantly according to the position of the respondent in the organisation. This reinforces the message that great care needs to be taken when analysing measures of skills deficiencies that are derived solely from employer surveys at national or subregional level.

The paper focuses on an employee’s perception of his or her own labour market outcome. It proposes that the basic earnings function, by adopting an approach that ignores perception effects, is likely to result in biased results that will fail to understand the complexities of the wage distribution. The paper uses an orthodox job search framework to illustrate the nature of this problem and then adapts the model to take onboard the theory of cognitive dissonance. The search model indicates how workers may adopt a coping strategy in order to reduce the disutility associated with the wage underpayment that develops. Then, by modelling cognitive dissonance, the paper highlights the weaknesses of using purely human capital proxies to understand labour market outcome. The analysis goes some way to explaining why individuals with equivalent human capital investment can have disparate earnings profiles.

This article utilizes DEA window analysis in order to investigate the relative efficiency levels of large UK retail banks during the period of transition 1982–1995. It finds that for the entire sample, the mean inefficiency levels are low in comparison to past studies, that the overall long run average efficiency trend is falling and that all banks in the study show reducing levels of efficiency over the entire time period. It then goes on to disaggregate efficiency into scale and pure technical efficiency and finds that: (1) scale inefficiencies dominate pure technical inefficiencies; (2) less big banks are more likely to report technical inefficiency and (3) during the 1990s banks with asset levels over £105bn suffer decreasing returns to scale