Private equity benchmarks and portfolio optimization

Portfolio optimization using private equity is typically based on one of three indices: listed private equity, transaction-based private equity, or appraisal value-based private equity indices. However, we show that none of these indices is fully suitable for portfolio optimization. We introduce here a new benchmark index for venture capital and buyouts, which is updated monthly, adjusted for autocorrelation (de-smoothing), and available contemporaneously. We illustrate how our benchmark enables superior quantitative portfolio optimization.     

Technological regimes in m-commerce: Convergence as a barrier to diffusion and entrepreneurship?

During the dotcom-period, a commonly shared belief was that m-commerce and m-payment would become just as successful as GSM and SMS. Although the ICT industry has successfully recovered from the dotcom crisis, m-commerce has still not had much success: why has the diffusion of m-commerce and m-payment been so slow, almost absent in Europe and USA? The article suggests that the obstacles accounting for this are plausibly systemic and related to factors that hinder the establishment of a new technological regime for m-commerce. Diffusion of m-commerce will require convergence of numerous disparate and competing elements and systems that at present belong to, or are controlled by, different sectors. The article presents a case study of a dotcom firm fictitiously entitled PinkFish in order to demonstrate these factors. By embracing a strategy of convergence based on symbiosis and co-operation, m-commerce may enter a rapid diffusion process in the future.     

Strengthening regional innovation through network-based innovation brokering

The primary objective of this paper is to demonstrate how regional innovation system theory may be translated into manageable micro-level methods with the potential for strengthening the productive dynamics of a regional innovation system. The paper meets this objective by presenting network-based innovation brokering (NBIB), a practical method designed using insights from regional innovation system theory and trust theory. Five cases from two Norwegian regional innovation networks show that in addition to knowledge development and diffusion, NBIB strengthened collaborative attitude and trust between members of the regional innovation system. Moreover, it served as an arena for entrepreneurial experimentation, resulting in projects combining two modes of innovation; the Science, Technology and Innovation mode and the Doing, Using and Interaction mode. The method, thus, may be viewed as a useful addition to the inventory of methods used to stimulate innovation in regional innovation systems (RISs). On a more general level, the paper represents a call to the community of innovation researchers and practitioners to give a higher priority to the question of how to better realize the pragmatic potential of RIS-theory.     

The impact of vertical separation on the success of the railways

This paper empirically analyses whether full ownership separation strengthens rail in comparison with other transport modes — a major goal of European and national transport policies. Data from nine European countries in the period 1994–2009 are evaluated, with the end result that the positive effects of full separation cannot be confirmed. On the contrary, full separation significantly reduces the share of rail in passenger transport, while in the freight segment, the regressions yield ambiguous results.     

How German Labor Courts Decide: An Econometric Case Study

Abstract. Courts are an important element in the institutional framework of labor markets, often determining the degree of employment protection. German labor courts provide a vivid example in this regard. However, we know relatively little about court behavior. A unique dataset on German labor court verdicts reveals that social and other criteria like employee characteristics, the type of job, local labor market conditions and court composition influence court decisions. At least as striking is that workers' chances to win depend on where and when their cases are filed. This generates considerable ex ante uncertainty about outcomes.     

„Unisex-Tarife“ — Gleichbehandlung von Männern und Frauen im privatrechtlichen Versicherungswesen

The enactment of a council directive ‘implementing the principle of equal treatment between women and men in the access to and supply of goods and services’ is beyond the EC’s legislative competences as far as it obliges private insurers to charge ‘unisex-rates’. Especially Art. 13 ECT constitutes no corresponding jurisdiction. Furthermore the compatibility of the draft directive and the principle of subsidiarity as laid down in Art. 5 II ECT is very doubtful. German laws implementing the directive needed to be in accordance with the Basic Constitutional Law of the Federal Republic of Germany since a considerable leeway in implementing the directive is left to the national legislator. In this respect such rules of law are open to judicial review by German courts of justice. The Federal legislator would have a so called concurring legislative competence according to Art. 74 I Nr. 11 GG (insurance industry under private law) and Art. 72 II GG. The legal obligation to apply ‘unisex-rates’ would lead to an unequal treatment of the sexes without adequate justification. Thus German implementation laws would infringe Art. 3 II1 and III 1 GG. The ban of gender-related actuarial factors would, after all, be incompatible with the Freedom of Profession of the concerned insurers guaranteed in Art. 12 I GG.     

Interdependence and economic development in North and South

In the past four or five years politicians in the industrialized countries and research workers as well have been making increasing use of the term “interdependence” as quintessential to the economic and political relations between the North and the South. What does this term mean? Can the extent and the effects of this interdependence be quantified?     

How opportunistic are partisan German central bankers: Evidence on the Vaubel hypothesis

Recent research has found inconclusive evidence regarding the presence of opportunistic political business cycles in German data. Inferring from Vaubel, 1993 and Vaubel, 1997one could argue, however, that at least in the case of monetary policy the results are seriously flawed from the onset, because an independent central bank such as the German Bundesbank will support the government only when it shares its partisan views. Vaubel has not presented parametric empirical evidence in support of his hypothesis. We show that the application of time series analysis yields results that clearly run counter to the hypothesis. Evidence on voting behaviour from the central bank council minutes points in the same direction. It appears perhaps paradoxically that an opportunistic government is better off facing an ideologically opposing Bundesbank council majority than a supportive one before elections.     

Forecasting ECB monetary policy: Accuracy is a matter of geography

Monetary policy in the euro area is conducted within a multi-country, multi-cultural, and multi-lingual context. How does this heterogeneity affect the ability of economic agents to understand and to anticipate monetary policy by the European Central Bank (ECB)? Using a database of surveys of professional ECB policy forecasters in 24 countries, we find remarkable differences in forecast accuracy, and show that these have important repercussions on market behaviour. Explaining the differences in forecast accuracy, we provide evidence that they are partly related to geography and clustering around informational hubs, as well as to country-specific economic conditions. In large part this heterogeneity can be traced to differences in forecasting models.