The efficiency of Mozambique soccer league: the Moçambola

This paper analyses the technical efficiency of the Mozambique football league from 2008 to 2014 using a Bayesian stochastic frontier model with exponential specification. Covariates include contextual characteristics such as location, identification as a Muslim club, and sporting performance. The results uncover that Mozambique sports clubs display varying efficiency, revealing distinct managerial incentives in the Mozambique football league. Policy implications are derived, including efficiency scores deemed to be acceptable to the league and reconsideration of the rationale for national investment in all league’s clubs.     

Industrial Policy and Firm Heterogeneity

Our concern in this paper is with firm-specific industrial policy. When R&D subsidies or taxes are differentiated among firms, the question arises as to which firms in an industry should receive such support. We analyze a situation where firms differ in their R&D technologies in two distinct ways: in the costs of performing R&D activities and in the output obtained from such activities. We find that the optimal firm-specific industrial policy is affected differently by the two sources of firm heterogeneity. Furthermore, a change in a firm's R&D productivity has an ambiguous effect on the optimal policy towards the firm.
JEL classification: O 31; L 52; F 13     

Coffee exports and industrialization in Brazil

We investigate the dynamic relationship between coffee exports and machinery imports in Brazil from 1869 to 1939. Our tests reveal cointegration and bidirectional causality in the temporal sense. This evidence suggests that foreign exchange real revenues from coffee exports were important for the onset of industrialization, as machinery imports proxy for real investment demand. Capital growth, in turn, also helped to boost the country’s exports.     

Analysing technical and allocative efficiency in the French grocery retailing industry

This paper focuses on the innovative two-stage procedure developed by Simar and Wilson to estimate the determinants of French retailing efficiency. During the first stage, the technical and allocative efficiency of French retailers will be assessed using the DEA (Data Envelopment Analysis) methodology to identify the best companies, in order to serve as peers for improving the performance of weaker companies. The companies analysed have therefore been ranked according to their total productivity over the period 2000–2004. During the second stage, the Simar and Wilson model will be used to bootstrap DEA scores via a truncated regression. The economic and managerial implications arising from this study will also be considered.     

Slacks determinants in Brazilian railways: a distance friction minimization approach with fixed factors

This study investigates the drivers for output-increasing/input-saving potentials in the Brazilian railway industry, which has undergone significant transformations since its privatization in the mid-1990s. The main research objective is to determine whether or not different types of cargoes and geographic regions serviced present a significant impact on railway slacks by applying a distance friction minimization (DFM) approach with fixed factors. Based on a balanced panel model, secondary data from the period 2004 to 2012 were collected and analysed. Results support anecdotal evidence regarding a heterogeneous impact of types of cargo and geographic location on input-reducing and output-increasing potentials, besides network length and average speed. Policy implications for railway authorities are also addressed by focusing on the specifics of each railway operator.     

Mergers in the food retailing sector: An empirical investigation

We address the problem of merger evaluation, for competition policy purposes, in the retailing sector. The likely effects of a possible merger are analysed ex ante. The novelty of the paper lies in the inclusion of downstream and upstream market power effects on the retailers. Also, it provides an empirical application to the Portuguese food retailing market. The effects of additional concentration on prices are estimated, as well as the price reduction insiders are likely to obtain via an improved bargaining position. The final effect on prices depends on how these cost reductions are reflected in insiders’ prices, i.e., on the pass-through rate. For realistic values of this rate we find that the merger in question will most likely increase consumer prices and, therefore, should not be allowed on an antitrust legislation basis.     

A performance assessment of the Angolan soccer league

This article analyses the technical efficiency of the Angolan soccer league from 2008 to 2014, using a translog distance stochastic frontier model. The Greene stochastic frontier model, presented in 2005, and Kumbhakar stochastic frontier model, presented in 1990, are adopted, and the covariates used include Luanda location, funding by the oil company Sonangol, club supported by rich fans and club relegated during the period. Policy implications are then derived.     

Managing Underpricing? The Case of Pre‐IPO Discretionary Accruals in China

Previous studies have found that companies use income‐increasing positive discretionary accruals (DAC) prior to initial public offerings (IPOs) to inflate earnings as a signal to anticipate future income and future dividends. This study, directly explores the role of DAC in prospectus information of 691 A‐shares IPOs in China during the period 1995–2002 and its relationship with market‐adjusted returns. The results suggest that in China, pre‐IPO non‐discretionary accruals (NDAC) as well as DAC have informative value in explaining first‐day returns as well as first‐year adjusted returns. However, in yearly cross‐sectional models, I find that firms use income‐decreasing accruals (conservative accounting) in prospectus financial statements. This downward manipulation or income “understatement” creates a regulatory setting that could explain initial underpricing and abnormally high IPO returns for A‐shares. In addition, the results show that as state ownership (SO) increases, cash flow also increases, exacerbating agency costs and adverse selection problems. These findings may suggest that managers might be using more conservative accounting in Prospectus financial data to offset the agency costs related to high cash flow, and high SO, by “banking income” and possibly therefore “smoothing” the effects of possible future suboptimal earnings.