Justifying top management pay in a transitional economy

We investigate some aspects of top management pay in China's listed firms. We find positive pay and performance sensitivities and elasticities for top executives. In terms of magnitude, these sensitivities are similar to those reported in U.S. firms during the 1970s. However, the pay and performance relation is slightly weaker for firms located in less developed provinces. We also find that the pay disparities between top managers and employees are positively related to a firm's performance. Thus, it appears that any deviation away from a manager-worker compensation norm has to be justified by superior firm performance. In additional analyses, we find that managers' perquisites are not related to performance.     

Griechenlands Krise: Das währungspolitische Trilemma im Euroraum

Die Eurozone ist vor allem durch die gef?hrdete Kreditwürdigkeit Griechenlands in eine schwere Krise geraten. Jetzt zeigt sich, dass jede W?hrungsunion ein Konstruktionsproblem hat. Die Mitgliedstaaten müssen auf die Autonomie in der Geldpolitik verzichten und ohne die Instrumente der Geld- und Wechselkurspolitik ihre internationale Wettbewerbsf?higkeit bewahren.     

Smart Meter-Angebote: Eine empirische Untersuchung von Kundenpräferenzen

The implementation of smart meters in German households by 2032 is a major step in the transition towards an intelligent and connected energy system. Despite of federal legislation providing a structured plan for the nationwide smart meter rollout including basic product requirements, actors within the energy market have the opportunity to take an active part in shaping the market through appealing product offers and hence to create competitive advantage. This study identifies relevant features of smart meters from literature und business practice, and measures customer’s preferences for these features. Results indicate predominantly positive customer evaluations of smart meter features, amongst which the availability of consumption data, the installation price and rental charges as well as time variable tariffs contribute most to overall utility of smart meters. Finally, findings suggest targeting customers by defining strategies to address privacy concerns, to educate about saving potentials as well as to create differentiated pricing schemes.     

A note on estimating the divisional cost of capital for diversified companies: an empirical evaluation of heuristic-based approaches

This note provides an empirical analysis of the potential for heuristic-based approaches to derive a divisional cost of equity from a firm's total cost of capital. Since an empirical relationship between fundamental information and systematic risk has previously been shown in other studies, idiosyncratic information on risk and performance ought to serve as a good proxy to calculate divisional adjustments. Two practically used, heuristic-based approaches are tested and a significant relationship is found between one of the measures and CAPM beta. This method may offer a plausible and comparatively uncomplicated method for adjusting a firm's total cost of capital for divisional use.     

The rise and fall of a market leader: Frozen foods in the U.K.

This paper explores the nature of competitive assets that are based on control of part of a market's infrastructure using a case study of the U.K. frozen food market. Following an argument due to Stigler, the thesis of the paper is that such assets are inherently transitory, and that positions of market leadership based on them tend to erode. This argument is consistent with the experiences of Birds Eye during the post-War period.     

Bürgerversicherung — Die Wirkung von Kopfprämien auf den Arbeitsmarkt

Capitation fees are considered to be an option for a change in funding principles for statutory health care insurance. This paper discusses several models of capitation fees either to be introduced for a part of the population or for all citizens. It analyses the impact of a change in financing health care on the labour market. Therefore microeconomic theory and a QUERU-model is applied. It also considers the issue of presently co-insured dependents.     

Kommunikationsproblem interaktives Fernsehen?

While other European countries — above all Great Britain — experienced large-scale changes of the television landscape due to the introduction of interactive services, interactive television seems to remain of marginal importance in Germany. Although interactive television has to face specific supply-side problems in Germany, there is an obvious lack of studies that offer information on the knowledge about, attitudes towards and usage of interactive television services. The results of a regional survey and a content analysis of regionally important newspapers show that interactive services are relatively well-known, raise indifferent attitudes and are rarely used. Moreover the results indicate that interactive television faces a communication problem. Theoretically, the mass media should play a decisive role in the process of the adoption of innovations. In contrast the data shows that information from mass media channels has an almost negligable effect on the knowledge about, attitudes towards and the usage of interactive television services.     

Investment planning under uncertainty and flexibility: the case of a purchasable sales contract*

Investment decisions are not only characterised by irreversibility and uncertainty but also by flexibility with regard to the timing of the investment. This paper describes how stochastic simulation can be successfully integrated into a backward recursive programming approach in the context of flexible investment planning. We apply this hybrid approach to a marketing question from primary production which can be viewed as an investment problem: should grain farmers purchase sales contracts which guarantee fixed product prices over the next 10 years? The model results support the conclusion from dynamic investment theory that it is essential to take simultaneously account of uncertainty and flexibility.