Financing technology transfer: assessment of university-oriented proof-of-concept programmes

This study analyses the characteristics of the proof-of-concept (POC) programmes initiated by university and public research organisations in Europe, as a mechanism to address funding gaps and improve the transfer of research-based inventions to markets. We contribute to the literature on investment readiness of new ventures and on financing technology transfer by assessing the structure of such funding instruments and identifying critical success factors for their design and implementation. The analyses rely on seven in-depth case studies of university-oriented POCs in Europe.     

Locational strategies of international hotel chains

An empirical study was undertaken into the expansion strategies of international hotel operators in five countries in Eastern Central Europe. A questionnaire survey was conducted of the leading chains, framed around an eclectic paradigm. The analysis was complemented with multivariate analysis of competitive and locational strengths, thereby permitting additional insights into the relative positions of the major companies. The major ownership advantages were knowledge of guest requirements, strategic planning, and reservation systems. Locational advantages identified consisted of the size and nature of the city in which the hotel was to be located, the infrastructure within the region, and the perception of the region as an attractive business destination.     

Endogenous uncertainty and the non-neutrality of money

Summary. We study some implications of the Theory of Rational Beliefs to monetary policy. We show that monetary policy in a Rational Beliefs environment can have an important effect on the characteristics of economic fluctuations. In Rational Beliefs Equilibria money is generically non-neutral unlike Rational Expectations Equilibria in which money is neutral and monetary policy is ineffective. Under Rational Beliefs Equilibria nominal prices and real output change not only in response to changes in the exogenous growth rate of money but also in response to changes in the state of beliefs. In Rational Beliefs Equilibria monetary shocks have real effects even when they are observed but are not fully anticipated. Furthermore, the non-neutrality of money results in a short run Phillips curve. When money “flutters, real output sputters” [8]. We show that Endogenous Uncertainty and the distribution of market beliefs are the major explanatory variables of such fluctuations. Under Rational Expectations monetary policy is ineffective because agents neutralize it by predicting correctly the effect of the policy. Under Rational Beliefs it is shown instead that inflation and recessions can be substantially aggravated by the distribution of market beliefs. Received: January 14, 2002; revised version: April 5, 2002 RID="*" ID="*" I would like to thank Mordecai Kurz for his constant help and support. Most of the ideas developed hereby have been inspired by innumerable and fruitful discussions with him. I have also greatly benefited from helpful comments by Stanley Black, Luigi Campiglio, Carsten Nielsen and Ho-Mou Wu. I also received valuable remarks from participants at the V meeting of “The Society for the Advancement of Economic Theory” held in Ischia, Italy, on July 2-8, 2001, where an initial draft of the present work was presented.     

Long-term investment sensitivity to cash flow and financial crisis

This study examined investment–cash flow sensitivity in unconstrained and constrained firms from 1980 to 2010 in a sample of Italian manufacturing firms. Investment sensitivity to cash flow decreased over time, and financially constrained firms showed little difference in the decline compared with unconstrained firms. Last, investment sensitivity to cash flow increased during the financial crisis of 2008.     

Innovation,growth and financial markets

We review some of the literature at the intersection of innovation, financial markets, and economic growth. We explore two key questions: (i) How financial markets interact with innovation; (ii) what type of quality transformations are brought about by innovation. A special emphasis is given to questions that stem from the 2008 economic and financial crisis, and to subjects further developed in the articles collected in this issue.     

Does antidumping use contribute to trade liberalization in developing countries?

Abstract .  Some supporters of antidumping have argued that this procedure serves as a kind of 'safety valve' for protectionist pressure. In this paper, we investigate whether there is empirical evidence that the use of antidumping actions has contributed to ongoing tariff reductions over the period 1988 to 2004 in a sample of 23 developing countries, some of which have become aggressive users of antidumping in recent years. The evidence is not supportive of the safety valve argument for these countries. Instead, evidence suggests that past use of antidumping may have led to less rather than more trade liberalization.     

Money non-neutrality in a Rational Belief Equilibrium with financial assets

Summary. In Rational Beliefs Equilibria money is generically non-neutral. Given the expectational perspective proposed by the Theory of Rational Belief Equilibrium, we show that one of the most important factors in the emergence of money non-neutrality is played by Endogenous Uncertainty. This, in contrast to the Rational Expectations results of money neutrality and policy ineffectiveness, leads to a scenario in which monetary policy has an impact on the real economy and price volatility. The heterogeneity of beliefs together with the distribution and intensity of agents' states of optimism/pessimism can amplify the real effect of monetary policy and/or generate endogenous fluctuations in the economy which are not explained by any exogenous shock. We claim that money non-neutrality is mostly an expectations driven phenomenon. Indeed, additional assumptions of asymmetry of information and/or unanticipated monetary policy are not needed to explain the real effect of monetary policy as it is customary in the New Classical Theory. Received: May 30, 2000; revised version: December 28, 2000     

Endogenous uncertainty and market volatility

We advance the theory that the distribution of beliefs in the market is the most important propagation mechanism of economic volatility. Our model is based on the theory of Rational Beliefs (RB) and Rational Belief Equilibrium (RBE) developed by Kurz (1994, 1997). We argue that the diverse market puzzles which are examined, such as the equity premium puzzle, are all driven by the structure of market expectations. In support of our view, we present an RBE model with which we study financial markets. The model is able to simulate the correct order of magnitude of: (i) the long term mean and standard deviation of the price\dividend ratio; (ii) the long term mean and standard deviation of the risky rate of return on equities; (iii) the long term mean and standard deviation of the riskless rate; (iv) the long term mean equity premium. In addition, the model predicts (v) the GARCH property of risky asset returns; (vi) the observed pattern of the predictability of long returns on assets, and (vii) the Forward Discount Bias in foreign exchange markets. The common economic explanation for these phenomena is the existence of heterogenous agents with diverse but correlated beliefs such that some agents are optimistic and some pessimistic about future capital gains. The model has a unique parameterization under which the model makes all the above predictions simultaneously. The parameterization requires the optimists to be in the majority but the rationality of belief conditions of the RBE require the pessimists to have a higher intensity level. In simple terms, the large equity premium and the low equilibrium riskless rate are the result of the fact that at any moment of time there are agents who hold extreme pessimistic beliefs and they have a relatively stronger impact on the market. The paper also studies the effect of correlation of beliefs among investors. It shows that the main effect of such correlation is on the dynamic patterns of asset prices and returns and is hence important for studying such phenomena as stochastic volatility. Received: May 16, 2000; revised version: November 15, 2000     

The Manager’s Notepad: Working Memory,Exploration, and Performance

This study builds upon March and Simon’s proposition that individual‐level differences must be considered when explaining decision‐making performance. We extend their discussion on the importance of decision‐makers’ attention to explain heterogeneous patterns of exploration and exploitation within the same uncertain environment. We develop a model of decision‐making under uncertainty in which ‘working memory’ – i.e., the ability to hold multiple elements in mind to actively process them – explains the emergence of heterogeneity in exploration‐exploitation choice patterns. We validated the model in a laboratory study and two replications involving 171 individuals. Our findings show that differences in working memory allow us to identify individuals who are more likely to choose exploration over exploitation appropriately, and thus achieve higher performance. We discuss the implications for management theories, and re‐propose the work of March and Simon as a unifying framework that still can be used to generate and test managerially relevant hypotheses.