Leveraged Acquisitions and the Market for Corporate Control

What is the function of the market for corporate control? Mike Wright and two colleagues outline the advantages of an active market in corporate control and review the consequences of leveraged buyouts.     

Federal Reserve System Rising: The Expansion of Board Veto Authority on the Eve of the Great Depression

Most scholars agree that restrictive Federal Reserve System (FRS) policies contributed to the depression’s duration and severity. FRS policy mistakes are attributed to faulty ideas, poor leadership, and decentralised institutions. Extant scholarship treats ideas as constraints which systematically led policy-makers astray. This paper instead focuses on the dual roles ideas play in shaping institutions and uniting coalitions behind institutional projects. It traces the rise and fall of New York FRS Governor Benjamin Strong’s ‘great idea’ that the FRS should promote international monetary stability. Declining support for New York’s internationalism enabled a rural Board faction to expand its veto power from 1928 to 1930. In the critical year following the 1929 stock market crash, Board obstruction of New York FRS attempts to lower its discount and bill rates caused its investments to fall faster than the system’s bond portfolio expanded, forcing outstanding system credit to contract. Beyond showing that the Board’s pre-depression rise mattered, the paper speaks to broader debates about how ideas become empowered to shape policies and inform interests.     

Culture,entrepreneurship and uneven development: a spatial analysis

Interest in the proposed connection between culture and entrepreneurship has grown significantly in recent years. However, less attention has been given to the nature of the overall impact of this proposed association on development outcomes, particularly at the local level. In response, this paper analyses the relationship between the nature of the culture, entrepreneurship and development experienced across localities, proposing that the link between culture and development is mediated by entrepreneurship. It focuses upon the concept of community culture, as well as embracing a notion of development incorporating both economic and social well-being outcomes. Drawing upon a multivariate spatial analysis of data from localities in Great Britain, the findings indicate that differences in rates of entrepreneurship are strongly influenced by the community culture present in these localities. Furthermore, a bidirectional relationship is found to exist between entrepreneurship and economic and social development outcomes. It is concluded that the embeddedness of local community culture presents a significant challenge for those places seeking to promote entrepreneurially driven development.     

Simulating A Multifactor General Equilibrium Model Of Production And Trade

This study builds and simulates a high dimensional general equilibrium model of production and trade with inputs of capital and eight separate skilled groups of labor. Constant returns to scale cannot be rejected in any sector as a null hypothesis. International capital flows and labor migration are found to have very small effects on income redistribution, a result which is called near factor price equalization. Protectionism, on the other hand, has more substantial effects. Elasticities describing the income redistribution due to protection in manufacturing, agriculture, and services follow a pattern suggested by factor intensities. [410]     

Cost of operating room time for endovascular transcatheter aortic valve replacement

Abstract

Background: Procedural efficiencies can contribute to cost reductions in transcatheter aortic valve replacement procedures (TAVR). The objective of this study is to determine operating room (OR) variable cost per minute in endovascular TAVR procedures, in a real-world hospital setting.

Methods: Using Premier data from January 2015–June 2016 for patients undergoing a primary endovascular TAVR (primary ICD-9 code of 35.05, ICD-10 code of 02RF37Z, 02RF38Z, 02RF3JZ, or 02RF3KZ) procedure, the OR cost per minute was calculated for each patient by dividing the total hospital OR variable cost by the OR time (minutes).

Results: Of the 4,573 patients in the cohort, the average age was 80 years, 77% were admitted electively, and the vast majority were discharged home with (30%) or without (45%) home care. Median OR time for endovascular TAVR procedures was 180?min. The trimmed mean OR cost per minute was $43.59 (SD = $28.68). When stratified by Elixhauser Risk score and Charlson comorbidity index, OR cost per minute increased with higher risk and comorbidity (p?<?0.0001 and p?<?0.041, respectively).

Conclusions: This contemporary estimate of the real-world variable OR cost per minute provides researchers with a critical parameter to refine economic models of TAVR and aid clinical program directors in resource planning according to a priori risk and comorbidity.     

The real rate of protection: the income and insurance effects of agricultural policy

Agricultural price policies in developed countries aim at protecting farmers against both low and volatile world market prices. However, traditional indicators of protection only refer to the income (level) effect of policy. Following other research, it is argued that public policy can also yield an insurance (stabilizing) effect. In this paper a way to measure these dual effects is proposed. The method is illustrated with wheat market data for the USA and the European Union. Strong evidence is found that the insurance effect is an important component of protection, albeit a small one relative to the income effect. Policy support provided higher income and lower insurance effects in the EU than in the USA. For both markets, policy reforms in the 1990s led to significantly reduced income effects and smaller insurance effects. Without accounting for the influence of policy on income variability, traditional measures of protection will understate the real rate of protection.     

Mentoring as a mechanism for improvement in local government

This article reports on a scheme to secure improvement in local government using a peer mentoring network. Mentoring promoted learning, and hence improvement, in many of the participating authorities. Mentoring schemes must be carefully designed to achieve positive outcomes—it is essential to have a clear understanding of what mentoring is and how it should be administered, and to involve members and relevant partners of the mentored organization.     

The determinants of corporate divestment in the UK

It has been widely suggested that since the early 1980s many diversified firms narrowed the scope of their activities by refocusing on their core businesses, primarily through divestment activity. This study examines the extent and determinants of divestment across a large sample of UK firms over the period 1985–1989. Divestment is analysed using both a proportions and count data (Poisson and negative binomial regressions) approach. The results confirm that corporate divestment is not merely a reflection of managerial idiosyncrasies or mean reversion behaviour in the activities undertaken, but is a purposeful response to exogenous change in a manner broadly consistent with both the agency theoretic and strategic views of the firm.     

Micro Convergence and Macro Convergence: Factor Price Equalization and Per Capita Income

Factor price equalization implies the equality of prices of the same productive factors across countries owing to free trade. The present paper examines the relationship between factor price equalization and the equality of per capita (per worker) incomes in the contexts of the static Heckscher–Ohlin trade model and the dynamic two-sector neoclassical growth model. Factor price equalization is shown to be neither necessary nor sufficient for equality of per capita incomes across trading countries.