Lock‐In Effects in Relationship Lending: Evidence from DIP Loans

Do prior lending relationships result in pass‐through savings (lower interest rates) for borrowers, or do they lock in higher costs for borrowers? Theoretical models suggest that when borrowers experience greater information asymmetry, higher switching costs, and limited access to capital markets, they become locked into higher costs from their existing lenders. Firms in Chapter 11 seeking debtor‐in‐possession (DIP) financing often fit this profile. We investigate the presence of lock‐in effects using a sample of 348 DIP loans. We account for endogeneity using the instrument variable (IV) approach and the Heckman selection model and find consistent evidence that prior lending relationship is associated with higher interest costs and the effect is more severe for stronger existing relationships. Our study provides direct evidence that prior lending relationships do create a lock‐in effect under certain circumstances, such as DIP financing.     

Exploring how innovation strategies at time of crisis influence performance: a cluster analysis perspective

This paper analyzes the connection between innovation activities of companies – implemented before crisis – and their performance – measured at time of crisis. The companies listed in the STAR Market Segment of the Italian Stock Exchange are analyzed. Innovation is measured through the level of investments in total tangible and intangible fixed assets in 2006–2007, while performance is captured through growth – expressed by variations of sales, total assets and employees – profitability – through ROI or ROS – and productivity – through asset turnover or sales per employee in the period 2008–2010. The variables of interest are analyzed and compared through statistical techniques and by adopting cluster analysis. In particular, a Voronoi tessellation is also implemented in a varying centroids framework. In accord with a large part of the literature, we find that the behaviour of the performance of the companies is not univocal when they innovate.     

Tourism,tourist learning and sustainability: an exploratory discussion of complexities,problems and opportunities

Learning is often a central element of tourism. Tourists can learn actively, i.e. with a specific purpose, as well as passively through the comparison of values, norms and customs. It has been argued that travel supports active learning that has positive outcomes for sustainability, for instance, in the context of conservation. Yet, the complexity of active and passive learning processes and their outcomes for environmental sustainability and sustainable lifestyles remain insufficiently understood. Against this background, the paper discusses selected learning outcomes for transportation (air travel), accommodation (hotels) and activities (theme park visits). Findings suggest that “desirable” learning (defined as pro-sustainable development learning) in tourism may be very limited, while in particular, passive learning processes which redefine social norms frequently have outcomes that are largely detrimental to sustainable lifestyles. They include forms of moral licensing, the diffusion of responsibilities as well as the attenuation of the negative consequences of travel. Given the economic, social and cultural importance of tourism vís-a-vís its global implications for environmental sustainability, learning outcomes in tourism deserve to be studied in greater detail, while strategies need to be devised to enhance sustainable learning effects.     

Demographic Transition and Economic Development in Karnataka

The universal process of population change has significant attainment of social and economic implications at global level. Demographic transition is not only consisting of population growth tendency but much more along with economic consequences Karnataka is in the third stage of demographic transition and this scenario is marked with opportunities and challenges. This paper examines the demographic trends of Karnataka by using different Census data collected from Census reports and time series data over the time period of 1991–2014 collected from SRS. The fertility and mortality levels in the state have declined considerably. The districts in the Karnataka state have shown considerable increment in HDI from decade to decade. The study used the bound testing approach to co-integration; Autoregressive Distributed Lag (ARDL) model was also applied for analyzing the long run relationship whereas Error Correction Mechanism (ECM) was applied for analyzing the short run link of the demographic variables with economic growth. The study exhibited that the demographic transition positively affected the economic growth in the long run and negatively in the short run.

     

The moderating role of nationality on destination experience

ABSTRACT

Differences in tourists’ cultural values are significant factors in their product and service choices, yet they have generally been neglected in the literature. Therefore, this study examined how tourists’ nationalities influence their perceptions of service quality, affective image perceptions, and revisiting intentions. Activities were found to be more determinant on a destination’s affective image for Russian tourists, whereas accommodation, hospitality, and language communication services had a larger effect on German tourists.     

Outward foreign direct investment by Polish state-owned multinational enterprises: is ‘stateness’ an asset or a burden?

State-owned enterprises (SOEs) are commonly associated with undue advantages due to preferential treatment by the state. Simultaneously they are often quoted as handicapped given the notorious state interference, management problems and agency tensions. They used to be regarded as a mainly domestic issue but in the context of globalisation and the fact that states enter treaties with new obligations, SOEs’ performance ceased to be solely a domestic problem, increasingly so as state-owned multinational enterprises (SOMNEs) emerge. This article presents the results of research on Polish SOEs’ outward foreign direct investment (OFDI). It offers an overview of overseas activities of nine major Polish firms with a state stake and aims to contribute to the conceptual literature on foreign investments conducted by SOMNEs. We distinguish between FDI by SOMNEs as specific – privileged (facilitated) or discriminated (hampered) – investments subject to the home country’s state power and the host country’s state perception.     

Environmental Policy,Sustainable Development,Governance Mechanisms and Environmental Performance

We investigate the effects of environmental policy (Climate Change Act – CCA), sustainable development frameworks (Global Reporting Initiative – GRI; UN Global Compact – UNGC) and corporate governance (CG) mechanisms on environmental performance (carbon reduction initiatives – CRIs; actual carbon performance – GHG emissions) of UK listed firms. We use the generalized method of moments (GMM) estimation technique to analyse data consisting of 2245 UK firm‐year observations over the 2002–2014 period. First, we find that the CCA has a positive effect on CRIs, and this effect is stronger in better‐governed firms. Second, we find that the GRI‐based framework is positively associated with CRIs. Third, we find that firms with poor CG structures have lower actual carbon performance compared with their better‐governed counterparts. Overall, our evidence suggests that firms can symbolically conform to environmental policy (CCA) and sustainable development frameworks (GRI, UNGC) by engaging in CRIs without necessarily improving actual environmental performance (GHG emissions) substantively. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment