Measurement of the intensity of the reforms in professions and economic activities in Greece via a composite regulation index

The institutional framework regulating professions/ economic activities of the service sector in Greece has been recently liberalised extensively, to promote competition, conform to European Community regulations and fulfil commitments under the Memoranda of Economic and Financial Policies. This paper aims to capture quantitatively this major structural reform, by measuring for the first time the degree of regulation in 90 professions/ activities affected by the relevant reform laws. The degree of regulation is measured both for the regime before and for that after the laws, and the methodology employed is that of composite regulation indices. The index values obtained are used for evaluating the extent of the reforms and estimating correlations and regressions. The results of the analysis point to the existence of significant barriers to competition before the reforms and extensive liberalisation of the regulatory framework after the adoption of the relevant laws. Moreover, the results suggest that professions/activities characterised by more stringent restrictions before the reforms tend to be characterised by a comparatively higher intensity of regulations after the reforms.     

The Timeliness of Income Recognition by European Companies: An Analysis of Institutional and Market Complexity

This study examines international differences in the asymmetric timeliness of accounting earnings by modelling international exposure to different jurisdictions as a firm-specific effect, using an index of regulatory complexity that relates to conditions in each of the capital markets in which the firm's equity is listed. The companies investigated are those with shares cross-listed on European stock exchanges, some of which are also listed in New York. Variation across jurisdictions and markets with respect to earnings timeliness and conservatism can be explained in part as an interaction of market effects and regulatory effects, with some evidence of opposition between the two, and the sensitivity of earnings to stock price changes shows a common, converging trend towards greater accounting conservatism in Europe.     

Irreversible investment and industry equilibrium

We establish the equivalence of competitive industry equilibrium with a central planner's decision problem under uncertainty, when investment is irreversible. The existence of industry equilibrium is derived, and it is shown that myopic behavior on the part of small agents is harmless, in the sense that it leads to the same decisions as full rational expectations do. Our model is set in continuous time and allows for very general forms of randomness. The methods are based on the probabilistic approach to singular stochastic control theory and its connections with optimal stopping problems.     

A survey of factors influencing the cost system design in hotels

This study examines the relationship between cost system functionality and contingent factors in the hospitality industry. An empirical survey via questionnaires was conducted on a sample of 100 leading hotels enterprises in Greece. Data analysis showed that the majority of hotels’ cost systems do not provide qualitative cost data. Results indicate that the level of cost system functionality is significant positively associated with the low cost strategy and the extent of the use of cost data (USD). No association was found between cost system design and size, level of competition, number of services variants and hotels’ management status.     

The numéraire portfolio in semimartingale financial models

We study the existence of the numéraire portfolio under predictable convex constraints in a general semimartingale model of a financial market. The numéraire portfolio generates a wealth process, with respect to which the relative wealth processes of all other portfolios are supermartingales. Necessary and sufficient conditions for the existence of the numéraire portfolio are obtained in terms of the triplet of predictable characteristics of the asset price process. This characterization is then used to obtain further necessary and sufficient conditions, in terms of a no-free-lunch-type notion. In particular, the full strength of the “No Free Lunch with Vanishing Risk” (NFLVR) condition is not needed, only the weaker “No Unbounded Profit with Bounded Risk” (NUPBR) condition that involves the boundedness in probability of the terminal values of wealth processes. We show that this notion is the minimal a-priori assumption required in order to proceed with utility optimization. The fact that it is expressed entirely in terms of predictable characteristics makes it easy to check, something that the stronger NFLVR condition lacks.      

Costs,knowledge and market structure: understanding the puzzle of international competitiveness with Greek export data

This is an analysis of the sources of international competitiveness with Greek export data for the period 1987–2007. The framework used in the study incorporates factors that do not only represent cost competitiveness but also shed light on the determinants of economic complexity. Economic complexity is the amount of knowledge capabilities embodied in exports that indicates – as a source of comparative advantage – the ability for product differentiation and product variety. The empirical analysis shows that industries benefit substantially from their own R&D activity but, owing to weak economic complexity in the country, there are no cross-industry knowledge spillovers (both at national and international level) that can benefit export activity. Greek exports were found to be sensitive to relative unit labour costs (RULC) but the most important export component of this index is relative labour productivity and not labour cost. Not all institutional arrangements have the same impact on exports, for example high trade union density might harm competitiveness but this factor is uncorrelated with R&D investment. In the view of these findings, Greece’s route to international competitiveness should be primarily by improving its economic complexity, making sure that the country specialises in productive activities that enrich its knowledge capabilities as well as increase the potential of knowledge transfer.     

Revisiting Wireless Internet Connectivity: 5G vs Wi-Fi 6

In recent years, significant attention has been directed toward the fifth generation of wireless broadband connectivity known as ‘5G’, currently being deployed by Mobile Network Operators. Surprisingly, there has been considerably less attention paid to ‘Wi-Fi 6’, the new IEEE 802.1ax standard in the family of Wireless Local Area Network technologies with features targeting private, edge-networks. This paper revisits the suitability of cellular and Wi-Fi in delivering high-speed wireless Internet connectivity. Both technologies aspire to deliver significantly enhanced performance, enabling each to deliver much faster wireless broadband connectivity, and provide further support for the Internet of Things and Machine-to-Machine communications, positioning the two technologies as technical substitutes in many usage scenarios. We conclude that both are likely to play important roles in the future, and simultaneously serve as competitors and complements. We anticipate that 5G will remain the preferred technology for wide-area coverage, while Wi-Fi 6 will remain the preferred technology for indoor use, thanks to its much lower deployment costs. However, the traditional boundaries that differentiated earlier generations of cellular and Wi-Fi are blurring. Proponents of one technology may argue for the benefits of their chosen technology displacing the other, requesting regulatory policies that would serve to tilt the marketplace in their favour. We believe such efforts need to be resisted, and that both technologies have important roles to play in the marketplace, based on the needs of heterogeneous use cases. Both technologies should contribute to achieving the goal of providing affordable, reliable, and ubiquitously available high-capacity wireless broadband connectivity.     

Transition to IFRS and compliance with mandatory disclosure requirements: What is the signal?

The present study examines 153 Greek listed companies' compliance with all IFRS mandatory disclosure requirements during 2005 and complements and extends prior literature in the following way. The unique setting i.e., measuring compliance with IFRS mandatory disclosure requirements during the first year of IFRS implementation, allows for examination of the possibility that the changes in the 2004 shareholders' equity and net income, as a result of the adoption of IFRS, constitute explanatory factors for compliance. Thus, this study hypothesises that, in addition to the financial measures and other corporate characteristics that prior literature identifies as proxies for explaining compliance, a significant change in fundamental financial measures, because of the change in the accounting regime, may also explain compliance based on the premises of the relevant disclosure theories. The findings confirm these hypotheses. This study also makes a methodological contribution on measuring compliance with all IFRS mandatory disclosure requirements by using two different disclosure index methods and pointing out the different conclusions may be drawn as a result.