Too dynamic to fail: empirical support for an autocatalytic model of Minsky’s financial instability hypothesis

Solomon and Golo (Account Econ Law 3(3):167–260, 2013) have recently proposed an autocatalytic (self-reinforcing) feedback model which couples a macroscopic system parameter (the interest rate), a microscopic parameter that measures the distribution of the states of the individual agents (the number of firms in financial difficulty) and a peer-to-peer network effect (contagion across supply chain financing). In this model, each financial agent is characterized by its resilience to the interest rate. Above a certain rate the interest due on the firm’s financial costs exceeds its earnings and the firm becomes susceptible to failure (ponzi). For the interest rate levels under a certain threshold level, the firm loans are smaller then its earnings and the firm becomes ‘hedge.’ In this paper, we fit the historical data (2002–2009) on interest rate data into our model, in order to predict the number of the ponzi firms. We compare the prediction with the data taken from a large panel of Italian firms over a period of 9 years. We then use trade credit linkages to discuss the connection between the ponzi density and the network percolation. We find that the ‘top-down’–‘bottom-up’ positive feedback loop accounts for most of the Minsky crisis accelerator dynamics. The peer-to-peer ponzi companies contagion becomes significant only in the last stage of the crisis when the ponzi density is above a critical value. Moreover the ponzi contagion is limited only to the companies that were not dynamic enough to substitute their distressed clients with new ones. In this respect the data support a view in which the success of the economy depends on substituting the static ‘supply-network’ picture with an interacting dynamic agents one.     

Economic impact of contrast-induced acute kidney injury associated with invasive cardiology: role of iso-osmolar contrast media in Germany,Italy, Poland,and Spain

Objective:

Iso-osmolar Iodixanol is associated with a lower rate of contrast-induced acute kidney injury (CI-AKI) in patients at increased risk compared to low-osmolar contrast media (LOCM). The aim of this study was to assess the financial consequences of CI-AKI risk reduction in patients undergoing coronary angiography (CA) with or without percutaneous coronary intervention (PCI) in German, Italian, Polish and Spanish hospitals.

Methods:

This budget impact analysis (BIA) compared a scenario with iodixanol to a scenario without, where only LOCM were used, in patients at increased risk of CI-AKI over a 3-year horizon. A meta-analysis based on a systematic review observed a lower rate of CI-AKI with iodixanol compared to LOCM (Risk Reduction?=?0.46) in patients with underlying impaired renal function (serum creatinine ≥1.6?mg/dl and estimated glomerular filtration rate ≤50?ml/min/1.73 m²). Contrast media and CI-AKI hospitalization costs were included in the analysis and unit costs were obtained from published literature, official sources or, when available, from hospital data. In the absence of country-specific data, resource utilization for a CI-AKI hospitalization was obtained by interviews with local clinicians in each country. The percentage of patients who received iodixanol was assumed to increase over time.

Results:

Based on a percentage of patients at increased risk of CI-AKI equal to 20% in Germany, 24% in Italy, 23% in Poland and 10% in Spain, results showed that the introduction of iodixanol would bring a 3-years cumulative net percentage saving on the total hospital budget of 29%, 34%, 25%, and 33% in the four countries respectively.

Conclusion:

The results of the analysis for the four countries showed that iodixanol use in patients at increased risk of CI-AKI undergoing CA with or without PCI may bring considerable savings on the hospital’s budget, due to the associated reduction in CI-AKI incidence.     

What do we [not] know about technology entrepreneurship research?

This study aims to review what we do (and do not) know about technology entrepreneurship (TE) research to date. Based on a categorized bibliometric analysis resulting from a systematic review of 135 scientific articles published in refereed journals over the past 27 years (1986–2013), we identify the core domains of TE, its intellectual structure, the scientific journals with a major impact in this field of research, and the affiliation and collaboration networks within it. Specifically, through a detailed analysis of article co-citations within the TE area, this study provides co-citation networks of authors, journals, and their respective clusters, revealing their rankings in terms of contributions to the TE literature. This comprehensive analysis can be used to enhance our understanding of TE and support further research in this field.     

Political economy and the ‘modern view’ as reflected in the history of economic thought

This paper focuses on the transition from classical political economy to ‘modern’ economics, a central aspect of which is the ascent of the conception of ‘theory’ as a mere instrument of research. We analyse how this transitional phase was perceived and interpreted in representative, more or less contemporaneous histories of economic thought: those by Luigi Cossa in 1880, by John Kells Ingram in 1915 (originally published in 1888), and by Charles Gide and Charles Rist in 1915. Despite their differences, all authors share the same conception of the structure of scientific laws, as well as the view that economics must be separated from liberalism.     

Drivers to firm innovation and their effects on performance: an international comparison

This research aims to analyse the drivers to company innovation and their effects on the financial performance. This study is based upon a sample of companies, located in two neighbouring countries (Portugal and Spain). Linear regression was the methodology deployed to analyse the importance of innovation types (differences between Portugal and Spain). To analyse the extent to which the innovation capacity variables influence financial performance (turnover), we made recourse to Probit Regression models. Our results show significant differences in terms of both the drivers and inhibitors to innovation in these two countries. The introduction of products into new markets only proved significant at Spanish companies whilst innovations in both products and processes are significant in both sets of Iberian companies.     

Gastronomy as a tourism resource: profile of the culinary tourist

The aim of this paper is to explore the characteristics and motivations of culinary tourists whose destination is the city of Córdoba (Spain) while attempting to determine whether gastronomy is an important aspect of the trip or if it is perceived simply as a secondary activity. Fieldwork was carried out among a series of restaurant establishments in the city of Córdoba. A demand survey was conducted in 10 particular establishments that were selected among those offering local dishes and which are regularly visited by tourists and the questionnaire was distributed among clients obtaining 206 valid answers. Our results reveal the strengths and weaknesses of Córdoba's restaurant sector. While 10% state that the cuisine is one of the main reasons for visiting the city, 68% believe that the local cuisine is an important but not an essential aspect of their trip and the rest view it as being secondary. These three types of tourists exhibit different kinds of motivation. This suggests that strategies should be designed and developed to promote gastronomy as one of the city's chief tourist attractions. Good tourism management based on initiatives such as the creation of culinary routes could be an alternative for implementing strategies aimed at the social and economic development and promotion of particular areas, for example turning typical food from rural areas in certain regions into a marketable attraction.     

Leisure-tourism and amenity migration: transformations observed in the semiarid mountain region of Northern Chile

ABSTRACT

In the last years, the mountain regions of Chile have started to be perceived as a destination for leisure-tourism activities and the development of amenity migration processes. Through semi-structured interviews and meetings conducted among key actors, locals and migrants, this work examines how the local community perceives the main consequences that current leisure-tourism and/or amenity migration processes have started to create in four local communes in the semi-arid region from the North of Chile. While local inhabitants acknowledge the development opportunities these processes entail, they are also starting to perceive effects on the identity of their communities as well as disparities, both in terms of territory and local governance. Studying the consequences of these processes may promote mitigation or adaptation measures to reduce the number of new conflicts and strengthen solidarity, both socially and territorially.     

The organization of expertise in the presence of communication

Principal decision-makers are sometimes obliged to rely on multiple sources of information when drawing conclusions about the desirability of given actions in response to decisions they face. They may hire specialized agents to inform their decisions. Principals have authority both to allow communication among agents of information and to prevent information-sharing. I assume that communication facilitates the emergence of some complementarities among agents, but it may also promote collusion. I study the optimal design of contracts focusing on how to sequence communication of expertise. I show that from a principal’s point of view, when the advantages of allowing communication dominate, communication is more effective before effort choices are made rather than after.     

On the appropriate objective function for post-disaster humanitarian logistics models

The paper argues that welfare economic principles must be incorporated in post-disaster humanitarian logistic models to ensure delivery strategies that lead to the greatest good for the greatest number of people. The paper's analyses suggest the use of social costs—the summation of logistic and deprivation costs—as the preferred objective function for post-disaster humanitarian logistic models. The paper defines deprivation cost as the economic valuation of the human suffering associated with a lack of access to a good or service. The use of deprivation costs is evaluated with a review of the philosophy and the economic literature to identify proper foundations for their estimation; a comparison of different proxy approaches to consider human suffering (e.g., minimization of penalties or weight factors, penalties for late deliveries, equity constraints, unmet demands) and their implications; and an analysis of the impacts of errors in estimation. In its final sections, the paper conducts numerical experiments to illustrate the comparative impacts of using the proxy approaches suggested in the literature, and concludes with a discussion of key findings.     

Entrepreneurship and regional dynamics: the case of Chile

ABSTRACT

During the last 20 years, social and political consensus has afforded the successful gradual implementation of entrepreneurship policy in Chile, transforming the country into one of the world’s most productive entrepreneurship ecosystems. However, the excessive political and economic centralization that has characterized Chile raises the question of whether spatial dependence influences entrepreneurship and what factors have led to this condition. By applying spatial econometric tools to data from 320 districts in Chile during the period 2013–2014, we conclude that there is spatial dependence among districts in Chile in relation to the creation of new businesses and that the immigrant population, the presence of different categories of universities and local patenting capacity are the variables with the greatest positive effect on this dependence.