Supply function equilibria: Step functions and continuous representations

In most electricity markets generators must submit step-function offers to a uniform price auction. These markets are often modelled as simpler pure-strategy Supply Function Equilibria (SFE) with continuous supply functions. Critics argue that the discreteness and discontinuity of the required steps drastically change Nash equilibria, invalidating predictions of the SFE model. We prove that there are sufficient conditions, offered quantities can be continuously varied, offered prices are selected from a finite set, and the density of the additive demand shock is not too steep, where the resulting stepped SFE converges to the continuous SFE as the number of steps increases, reconciling the apparently very disparate approaches to modelling electricity markets.     

Assessing the profitability of intraday opening range breakout strategies

Is it possible to beat the market by mechanical trading rules based on historical and publicly known information? Such rules have long been used by investors and in this paper, we test the success rate of trades and profitability of the Open Range Breakout (ORB) strategy. An investor that trades on the ORB strategy seeks to identify large intraday price movements and trades only when the price moves beyond some predetermined threshold. We present an ORB strategy based on normally distributed returns to identify such days and find that our ORB trading strategy result in significantly higher returns than zero as well as an increased success rate in relation to a fair game. The characteristics of such an approach over conventional statistical tests is that it involves the joint distribution of low, high, open and close over a given time horizon.     

Entrepreneurial global franchise ventures: US and European franchisee failure strategic and empirical perspectives

Rapid United States and European franchise growth offers potential benefits for stakeholders and host counties, as well as the potential for failure. Franchisee failure research is a complex area confounded by varying failure definitions, approaches, an event-focus, and single-year data. This paper includes a strategic franchisee failure perspective that views franchisee failure as a multi-stage process rather than an event; new longitudinal data from the United States for over 780 franchise systems and 292,000 franchise units and United Kingdom franchisee failure data for over 700 franchise systems and 31,000 franchisee units; and estimates of current European business-format franchise market size, including selected Central and Eastern European countries. Understanding and mitigating franchisee failure provide potential lessons for franchisors and franchisees. Franchisee failure and the strategic implications for franchise entrepreneurial ventures is a significant research area that merits further study and analysis.     

Discussion on assessing quality of administrative data

The paper discusses the role, challenges and methods available to National statistical organisations to document and assess the quality of their administrative data.     

Modelling leadership—Implicit leadership theories in Sweden

This paper investigates Swedish data on implicit leadership theories in comparison with data from 61 other nationalities, testing the identification of a Swedish leadership style in light of globalization and possible converging value-formation processes. Global questionnaire data from 17,310 (900 Swedish) middle-managers constitute the basis for our analyses, using both a within-country perspective and a between-country perspective. While acknowledging the presence of almost universally endorsed leadership attributes, such as being inspirational and visionary, “typical” Swedish leadership attributes are possible to identify. Thus we challenge the simplified version of global convergence regarding leadership ideals and management ideology. On a basis of this study, we conclude that the notion of a Swedish leadership style is still meaningful and valid as a device for a better understanding of leadership efforts and cross-cultural interaction.     

Employee stock option plans and stock market reaction: evidence from Finland

This paper examines whether the adoption of stock option plans results in changes in shareholders’ wealth, and whether the stock market reactions to ESOP announcements could be explained by the target group of ESOP and the dilution effect. Short-horizon test methods are applied for this purpose. The sample consists of ESOP announcements of Finnish publicly quoted companies on the Helsinki Stock Exchange during the time period 1988–1998. The event study results show a slightly positive market reaction to announcements of ESOPs targeted to management and a negative market reaction in the case of ESOPs targeted to all employees. The results of regression analysis show that the ESOPs with limited dilution convey positive information to the stock market and the dilution effect has a negative impact on stock returns, especially in the case of ESOPs targeted to all employees.     

Equality and the swedish work environment

The tension betweenneed andeffort is at the core of differing interpretations of social equality and inequality. Need-based thinking entails social and economic justice for all within the state regardless of abilities and effort. Effort-based thinking embodies distribution of material resources according to energy expended, abilities, and achievement. The Swedish model for the past five decades has sided with need-based egalitarian mindedness and increasingly has applied that criterion to the quality of working life. Accommodations were made for wealth, a managerial elite, and strong unions. Recently, the country’s overheated economy and pressures for austerity have caused a reassessment of the welfare state.     

Mixed strategies in discriminatory divisible‐good auctions

We introduce the concept of an offer distribution function to analyze randomized offer curves in multiunit procurement auctions. We characterize mixed‐strategy Nash equilibria for pay‐as‐bid auctions where demand is uncertain and costs are common knowledge, a setting for which pure‐strategy supply function equilibria typically do not exist. We generalize previous results on mixtures over horizontal offers as in Bertrand‐Edgeworth games and also characterize novel mixtures over partly increasing supply functions. We show that the randomization can cause considerable production inefficiencies.