The productivity of private and social farms: Multilateral Malmquist indices for Slovene dairying enterprises

Applying programming techniques to farm-level panel data for four cooperative and 12 private dairy farms in the Yugoslav Republic of Slovenia gives estimates of technical efficiency, scale efficiency, and technical progress. These are used to construct multilateral Malmquist indices of total factor productivity (TFP). For the cooperatives, TFP growth has been slow and is attributable to technical progress. For the private farms, technical progress was also slow, but TFP growth was faster due to improved efficiency. Scale inefficiency explains the poorer absolute performance of the private farms, indicating the need for land reform as well as technological change.     

Corporate governance in family-controlled firms in Taiwan

This paper examines the effects of ownership structure and board characteristics on performance in publicly traded Taiwanese firms that are controlled by founding families. Results show that when shares are owned by institutional investors, particularly foreign financial institutions, firms perform better. However, where families are the major shareholders, this is not the case. In addition, boards that are independent of the financial interests of the founding family have a positive impact on performance, whether measured by accounting ratios, operating performance or the stock market. (JEL: P52, G32)     

The importance of being earners: why women in South Africa need well-paid jobs

The ‘children fare better’ viewpoint claims that children tend to be better fed if their mother (as opposed to father) has sufficient income of her own for food. This paper assesses this claim for South Africa, using data from household surveys. It considers the possibility that this issue is related to domestic violence between husband and wife, and finds an apparent link between wife's earnings, child nutrition and domestic violence. Children's well-being seems more assured if mothers have an adequate income; but there is more risk of inadequate nutrition in households where there is domestic violence against wives.     

Islamic finance and market segmentation: Implications for the cost of capital

This paper considers the impact of full Islamic shari’ya compliance on developing stock exchanges in their effective provision of development capital. Evidence from a unique study focussing on the Sudan telecommunications company and its listings on the Khartoum as well as Arabian Gulf stock exchanges reveals that costs of capital are considerably higher in the former than latter markets. While there are firm governance benefits arising from Islamic finance monitoring costs are substantial and the banking system is better placed to administer financing arrangements. Larger firms are better placed to circumvent this segmentation through cross-listing on regional exchanges.     

The Stability and Growth Pact,and Balanced Budget Fiscal Stimulus: Evidence from Germany and Italy

This paper assesses the limitations that the Stability and Growth Pact has imposed on Italy’s economic recovery and its debt reduction. By evaluating Germany’s fiscal policy since 1997, the paper offers recommendations for the Italian authorities. Measures put forward by European Union institutions are hampering Italy’s economic recovery, and evidence indicates that fiscal consolidation is ineffective in reducing the debt-to-GDP ratio. A balanced budget fiscal injection seems the only way for Italy to escape from its economic slump without further violations of the SGP. The paper concludes that the Pact either needs to be reformed or replaced by a central fiscal authority.     

The role of the stock market in the provision of Islamic development finance: Evidence from Sudan

This paper assesses the impact of stock exchange funding in the Shari'ya compliant Islamic economy of Sudan. Evidence suggests that while Islamic financial instruments have considerable potential in facilitating development finance through their emphasis on partnership this is better achieved by the banking system rather than the Khartoum Stock Exchange. A case study of the Sudan Telecommunications company shows that larger firms able to cross-list elsewhere are likely to choose regional markets in preference to their domestic one thus benefiting from lower costs of equity. However, governance preferences are likely to favour block shareholders following the Islamic finance partnership concept.     

Book reviews

Innovation and Industrial Strength in the UK, West Germany, United States and Japan Joan Cox &; Herbert Kriegbaum London, Policy Studies Institute, 1989, 168pp. Industrial Societies After the Stagnation of the 1970s. Taking Stock from an Interdisciplinary Perspective Burkhard Strumpel (ed.) Berlin, de Gruyter, 1989, 313pp.

The Social Basis of the Microelectronics Revolution Alfonso Hernan Molina Edinburgh, Edinburgh University Press, 1989, xxi + 260pp., £25.00 h/b (also avail-able in p/b)

Innovation and Technology Transfer in Japan and Europe: Industry-Academic Relations Glynn 0. Philips (assisted by Michael Hughes) London, Routledge, 1990, 282pp.) £45.00

Banking 1992-A Eurostudy Special Report Ian Gillespie (ed.) I,ondon, Eurostudy Publishing, 1990, 162pp., $£60 ($99)     

The role of corporate governance in FDI decisions: Evidence from Taiwan

There has been a considerable literature on the determinants of why firms undertake foreign direct investment (FDI), but very little on whether firms with different governance characteristics are more or less likely to venture overseas. For example, are family-controlled firms more predisposed to FDI than firms, with similar attributes, but different forms of ownership? Does the presence of institutional shareholders suggest a greater propensity to invest abroad? Does the composition of the Board of Directors have an impact? Most extant studies of corporate governance focus on the impact of governance factors on firm performance. However, these performance outcomes are a function of the strategic decisions made by the firms, which suggests it might be useful to consider the relationship between corporate governance factors and particular strategic decisions. One example is the decision to undertake foreign direct investment. The two main strands of IB literature on the determinants of FDI have little or nothing to say about how corporate governance factors might affect the FDI decision. Both internalisation theory and the resource-based view see FDI primarily as a means by which firms can appropriate rents in overseas markets from the exploitation of their idiosyncratic resources and capabilities. This paper extends this literature by investigating the effects of governance factors on the decision to undertake FDI. In particular, we want to assess the impact upon the FDI decision of (a) the extent of family control, (b) the presence of domestic and foreign institutional shareholders, and (c) the composition of the Board of Directors. We investigate these effects using a sample of 228 publicly listed firms in Taiwan, and our results clearly indicate that family control and share ownership by domestic financial institutions in Taiwanese firms are associated with the decision to undertake FDI. We also find that corporate governance impacts in different ways with regard to Taiwanese FDI in China in comparison to Taiwanese FDI in the rest of the world.     

Consumption norms,trickle-down and the video/microwave syndrome

A new method is presented for investigating empirically the presence or not of consumption norms in the ownership of durables amongst different socioeconomic groups (although the method is more generally applicable to any situation in which a number of characteristics, and not just durables, may be acquired in a specific sequence). In order to illustrate the method, some results are presented for the ownership of durables as sampled by the National Readership Survey for 1985 and 1990. As a further application of the method, particular attention is paid to the changing incidence of ownership of videos and microwaves. Both theoretically and empirically, the trickle-down model of consumer choice is critically assessed and found to be wanting.     

Labour Markets in China: A Study of the Structure and Evolution of Wages

This paper examines the development of labour markets and the evolution of a structure of wages in China, using household surveys for 1988, 1995, 2002 and 2007. It finds evidence of both provincial and sectoral segmentation in labour markets, with eastern regions and the state-controlled sector enjoying high wage premiums in the early reform period. During the reform, China has progressed slowly towards an integrated labour market with convergence in incomes between the rural non-agriculture sector and the urban market-based sector by 1995, when industry flourished in the rural areas. The wage gap between the rural non-agriculture sector and other sectors increased and the urban state-controlled sector remained segmented with respect to all other sectors up to 2002. However, the data from 2007 show there has been increasing sectoral and spatial integration.